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Best Practices in Product Pricing
     by mark (at) agilician (dot) com
  Pricing Models
  Mendix - From enterprise to volume

  Setting Prices
  Wakoopa - Pricing the new tracking service

  Price Lists and Tables
  Usabilla - How to present the service plans?
Image/Prestige Pricing
Premium Pricing
Discount Pricing
Penetration Pricing
Complementary Pricing
Skim Pricing
com
      x.
    di
 en
m
Parameter of pricing models
                                          for software products



Formation of      Structure of    Assessment                Price             Price         Dynamic pricing
   price         payment flow        base              discrimination       bundling           strategies



    Price       Single payment      Number of            1st Degree          Offer            Penetration
determination                        pricing                                                    pricing
                                   components                             Pure bundling
 Cost-based                                                               Mixed bundling
 Value-based                                                              Unbundling
 Competition-                           Usage-
 oriented                                                2nd Degree        Product          Follow-the-free
                  Recurring            dependent
                                                                                                strategy
  Degree of       payments                               Quantity         Software
 interaction                      Transaction
                                                         Time             Maintenance
                 Frequency        Memory
 Unilateral                       requirements           Versioning       Service/Support
                 Duration         Time
 Interactive                      ...                    3rd Degree        Degree of          Skimming
                 Combination                                              integration          strategy
                                   Usage-                Person-related
                                 independent                              Complementary
                                                        Region-related
                                                                          Substitutive
                                 Named user
                                                                          Independent
                                 Concurrent user
                                                           Multi-         Price Level
                                 Machine, Server         dimensoinal
                                 CPU                                      Additive
                                 Key performance
                                 indicators                               Superadditive
                                 ...                                      Subadditive
Best Practices in Product Pricing

  Pricing Models
  Mendix - From enterprise to volume

  Setting Prices
  Wakoopa - Pricing the new tracking service

  Price Lists and Tables
  Usabilla - How to present the service plans?
Find Signposts
Align with Customers’ Business
Consider The Channel

$10 = credit card
$50 = credit card and expense claim
$500 = company credit card
$1500 = purchase order and bill
$10000 = call for tender
Psychology: Perceived Value
Test and Iterate


Make an informed guess.
Try it out.
Change the price and try again.
m
               co
          g.
       in
     ck
  tra
qd
QD Pricing

Low yearly fee
Avoids unusual upfront investment
Aligns with existing panel member incentives

Most costs project based
Only paid when customer makes revenue
Aligns with existing analyst daily rate
Best Practices in Product Pricing

  Pricing Models
  Mendix - From enterprise to volume

  Setting Prices
  Wakoopa - Pricing the new tracking service

  Price Lists and Tables
  Usabilla - How to present the service plans?
m
          co
        a.
     ill
  ab
us
f   t
 ra
D
f   t
 ra
D
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  na
Fi
Don’t Just Roll The Dice
http://downloads.businessofsoftware.org/dontjustrollthedice.pdf

The Changing Labyrinth of Software Pricing
http://delivery.acm.org/10.1145/1280000/1272531/p19-cusumano.pdf?
key1=1272531&key2=2761884811&coll=GUIDE&dl=&CFID=15151515&CFTO
KEN=6184618

Pricing Strategies of Software Vendors
http://www.springerlink.com/content/x83v32xt12qw7171/

40 Fantastic Pricing Tables for Your Inspiration
http://www.1stwebdesigner.com/inspiration/fantastic-pricing-tables-inspiration/
mark (at) agilician (dot) com

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Pricing Session PCampB

  • 1. Best Practices in Product Pricing by mark (at) agilician (dot) com Pricing Models Mendix - From enterprise to volume Setting Prices Wakoopa - Pricing the new tracking service Price Lists and Tables Usabilla - How to present the service plans?
  • 8. com x. di en m
  • 9.
  • 10. Parameter of pricing models for software products Formation of Structure of Assessment Price Price Dynamic pricing price payment flow base discrimination bundling strategies Price Single payment Number of 1st Degree Offer Penetration determination pricing pricing components Pure bundling Cost-based Mixed bundling Value-based Unbundling Competition- Usage- oriented 2nd Degree Product Follow-the-free Recurring dependent strategy Degree of payments Quantity Software interaction Transaction Time Maintenance Frequency Memory Unilateral requirements Versioning Service/Support Duration Time Interactive ... 3rd Degree Degree of Skimming Combination integration strategy Usage- Person-related independent Complementary Region-related Substitutive Named user Independent Concurrent user Multi- Price Level Machine, Server dimensoinal CPU Additive Key performance indicators Superadditive ... Subadditive
  • 11. Best Practices in Product Pricing Pricing Models Mendix - From enterprise to volume Setting Prices Wakoopa - Pricing the new tracking service Price Lists and Tables Usabilla - How to present the service plans?
  • 14. Consider The Channel $10 = credit card $50 = credit card and expense claim $500 = company credit card $1500 = purchase order and bill $10000 = call for tender
  • 16. Test and Iterate Make an informed guess. Try it out. Change the price and try again.
  • 17. m co g. in ck tra qd
  • 18. QD Pricing Low yearly fee Avoids unusual upfront investment Aligns with existing panel member incentives Most costs project based Only paid when customer makes revenue Aligns with existing analyst daily rate
  • 19. Best Practices in Product Pricing Pricing Models Mendix - From enterprise to volume Setting Prices Wakoopa - Pricing the new tracking service Price Lists and Tables Usabilla - How to present the service plans?
  • 20. m co a. ill ab us
  • 21. f t ra D
  • 22. f t ra D
  • 24.
  • 25.
  • 26. Don’t Just Roll The Dice http://downloads.businessofsoftware.org/dontjustrollthedice.pdf The Changing Labyrinth of Software Pricing http://delivery.acm.org/10.1145/1280000/1272531/p19-cusumano.pdf? key1=1272531&key2=2761884811&coll=GUIDE&dl=&CFID=15151515&CFTO KEN=6184618 Pricing Strategies of Software Vendors http://www.springerlink.com/content/x83v32xt12qw7171/ 40 Fantastic Pricing Tables for Your Inspiration http://www.1stwebdesigner.com/inspiration/fantastic-pricing-tables-inspiration/
  • 27. mark (at) agilician (dot) com