Pricing is an issue that is often ignored and under-analyzed for companies. The best companies review their monetization every quarter going beyond the actual price and focusing on value created by the company’s product. Monetization strategy is shaped by the segment and vertical that is being targeted, the product itself, customer perception and the price of the product.
The following are two of the most important elements of determining a monetization strategy.
Monetization never stops. It is the continual matching of value to target customer segments. Other issues like the actual price point, packaging and finally smaller optimizations like add-on strategies and contract term decisions can be focused on. Something is better than nothing and fitting your monetization strategy to your customers through research will allow for more informed decisions when pricing and targeting market segments. Knowing your customer quantitatively is essential to any SaaS pricing strategy.