Dear SaaStr: How Can I Increase Pricing without Upsetting Customers?
One simple idea: earn it.
Firstly, consider raising prices yearly for new customers, but make sure you have added enough value to justify the increase. Focus on new customers, not existing ones. The amount of the increase should reflect the growth and improvements your company has made over the last year, as well as your standing against competition and brand strength. Earn the right to increase prices annually for new customers by proving your worth.
Secondly, be mindful not to overcharge your customers. Only increase prices based on the value you have delivered. It may be challenging to measure, but as a CEO, it is your responsibility to strike a balance.
Thirdly, concentrate on increasing deal size in addition to pricing. Often, closing deals with larger volumes can be more lucrative than adjusting per-user pricing. Learn more about deal size here.
Fourthly, consider starting with a higher price point. If your biggest customer is satisfied paying $25k annually, try asking for $35k from similar leads. Gradually increase the price for your largest deals to build confidence.
While spreadsheets are useful, pricing is a complex subject that involves various factors such as brand reputation, competition, and sales strategies. The tips mentioned above can help navigate this complexity.
