4 ms·

Quickest way to lose a sale is to provide pricing to non-expert buyers who are not likely to understand key parts of your product just from reading about it on

by zaidf 13y ago

Quickest way to lose a sale is to provide pricing to non-expert buyers who are not likely to understand key parts of your product just from reading about it on the site. We have customers who are used to paying $5 bucks/mo for a shitty website; it takes some convincing for us to get them to pay us 10-20x more(for a much better product). If we simply put up the pricing on the site, we'd scare them away and never even get to speak with them.

pccampbell 13y ago
Agreed that some products (a lot in enterprise software or consulting) require a more buttoned up pricing strategy, but if you serve the mid-market at all you should at least provide them some sort of signpost. "Here's what a project sort of looks and here's where the price starts" With good design you can make it happen. You'll actually help the sales process 10x, because you'll get rid of the tire kickers and people who are just sort of interested.
thrush 13y ago
This seems to be a softspoken opinion on this thread, but I definitely agree. Would love to see data on different products and the results of their pricing strategy. I think the major differentiator is SaaS that is sold in bulk (the entire company will start using the service after the buying decision is made) versus single license from a user that is making a buying decision only for themselves. The data could help to show how SaaS relates to a long tail distribution, where the tail is made up of the sort of single license purchases I mentioned. Also, what the article doesn't talk about is Free Trial options. This might not really be related to pricing pages in general, but are definitely important to how buying decisions are made.
notahacker 13y ago
This. And even when you're the only game in town, a ten minute conversation can do a much better job of helping the genuine prospect choose the $700/month plan over the $250/month plan than a couple of bullet points on a feature list. And a clients that wouldn't quibble at a quote of $2000/month for the version that does everything they think they need are a lot more likely to do so when a brightly coloured matrix points out they could get away with paying $200 if they didn't want the Excel export... Frankly, if customers are choosing their plan from a price/feature list rather than receiving a quote based on an assessment of the level of service they need to maximise their returns on using your product, the service isn't really priced on the basis of value.
- mnordhoff 13y ago
  The two examples you gave were about maximizing your returns by tricking your customers into buying things they don't need, not "maximis[ing] their returns on using your product" or "pric[ing] on the basis of value". edit: typo
- abruzzi 13y ago
  This may work for some customers but on the flip side this is what I encounter: - I am given a fixed budget to implement something. (I work for the government so I spend millions of dollars a year, but budgeting is done once a year so I go into a project knowing I have $100k to spend.) - Find that all the prospective vendors in a field are hidden pricing. - I end up filling out the "contact us for pricing" forms on a dozen websites. - I field calls from a dozen salespeople, who don't want to give even approximate pricing until they've done at least a demo and a second conference call. - When I get to pricing 8 of those 12 are prima facia more than we can afford (see fixed budget above) - I've just wasted 20-30 hours of my time and 2-3 hours of each vendors time learning about and examining products that I now know I can't afford. Plus there are always several salespeople that don't give up. (I've had salespeople continue to prospect me even after an RFP with published results and purchase from another vendor.) I remember doing ID Management. We ended up doing Novell at about $60k. But I remember when we got to the pricing stage with another vendor and got a price on the order of $750k. That's 1/3 of the entire departmental budget including salaries and benefits. If I know some amount of pricing going in, I wouldn't have wasted their time.
  - zaidf 13y ago
    I think the problem here is as much poorly-trained sales people than the practice of not disclosing pricing on the website. Smart sales people should be trained to recognize different types of buyers. From the sound of it, you are a buyer who knows exactly what he wants and just needs the price. Sales at our company would recognize this very early on and get you the info that you need minus the typical sales pitch. We specifically train our reps spot out buyers like you and handle them differently. For example, if a buyer sounds highly technical from the beginning(or if they use certain buzz words), the sales reps will transfer to me so I can have a more nuanced conversation.
pyre 13y ago
Well, you know that a company is trying to take you for all that they can when the first line of questioning from them is focused on how big your budget is / how much money you're willing to spend on them. This is par for the course for many companies that are on a sales-rep model.
- zaidf 13y ago
  This is par for the course for many companies that are on a sales-rep model. The best inside sales ops do not allow this because when you do this at scale, you find out that customers will realize the true value of your product over time and if you significantly overcharged them at the time of signing up, you will lose trust, have trouble renewing and getting referrals. So grossly overcharging just because they are willing to pay is generally a poor business decision. The fly-by-night operations are more likely to do what you are saying but fly-by-night ops aren't limited to sales-rep model.

by zaidf 13y ago

pccampbell 13y ago

Agreed that some products (a lot in enterprise software or consulting) require a more buttoned up pricing strategy, but if you serve the mid-market at all you should at least provide them some sort of signpost. "Here's what a project sort of looks and here's where the price starts" With good design you can make it happen. You'll actually help the sales process 10x, because you'll get rid of the tire kickers and people who are just sort of interested.

thrush 13y ago

This seems to be a softspoken opinion on this thread, but I definitely agree. Would love to see data on different products and the results of their pricing strategy. I think the major differentiator is SaaS that is sold in bulk (the entire company will start using the service after the buying decision is made) versus single license from a user that is making a buying decision only for themselves. The data could help to show how SaaS relates to a long tail distribution, where the tail is made up of the sort of single license purchases I mentioned. Also, what the article doesn't talk about is Free Trial options. This might not really be related to pricing pages in general, but are definitely important to how buying decisions are made.

notahacker 13y ago

This. And even when you're the only game in town, a ten minute conversation can do a much better job of helping the genuine prospect choose the $700/month plan over the $250/month plan than a couple of bullet points on a feature list. And a clients that wouldn't quibble at a quote of $2000/month for the version that does everything they think they need are a lot more likely to do so when a brightly coloured matrix points out they could get away with paying $200 if they didn't want the Excel export... Frankly, if customers are choosing their plan from a price/feature list rather than receiving a quote based on an assessment of the level of service they need to maximise their returns on using your product, the service isn't really priced on the basis of value.

mnordhoff 13y ago
The two examples you gave were about maximizing your returns by tricking your customers into buying things they don't need, not "maximis[ing] their returns on using your product" or "pric[ing] on the basis of value". edit: typo
abruzzi 13y ago
This may work for some customers but on the flip side this is what I encounter: - I am given a fixed budget to implement something. (I work for the government so I spend millions of dollars a year, but budgeting is done once a year so I go into a project knowing I have $100k to spend.) - Find that all the prospective vendors in a field are hidden pricing. - I end up filling out the "contact us for pricing" forms on a dozen websites. - I field calls from a dozen salespeople, who don't want to give even approximate pricing until they've done at least a demo and a second conference call. - When I get to pricing 8 of those 12 are prima facia more than we can afford (see fixed budget above) - I've just wasted 20-30 hours of my time and 2-3 hours of each vendors time learning about and examining products that I now know I can't afford. Plus there are always several salespeople that don't give up. (I've had salespeople continue to prospect me even after an RFP with published results and purchase from another vendor.) I remember doing ID Management. We ended up doing Novell at about $60k. But I remember when we got to the pricing stage with another vendor and got a price on the order of $750k. That's 1/3 of the entire departmental budget including salaries and benefits. If I know some amount of pricing going in, I wouldn't have wasted their time.
- zaidf 13y ago
  I think the problem here is as much poorly-trained sales people than the practice of not disclosing pricing on the website. Smart sales people should be trained to recognize different types of buyers. From the sound of it, you are a buyer who knows exactly what he wants and just needs the price. Sales at our company would recognize this very early on and get you the info that you need minus the typical sales pitch. We specifically train our reps spot out buyers like you and handle them differently. For example, if a buyer sounds highly technical from the beginning(or if they use certain buzz words), the sales reps will transfer to me so I can have a more nuanced conversation.

pyre 13y ago

Well, you know that a company is trying to take you for all that they can when the first line of questioning from them is focused on how big your budget is / how much money you're willing to spend on them. This is par for the course for many companies that are on a sales-rep model.

zaidf 13y ago
This is par for the course for many companies that are on a sales-rep model. The best inside sales ops do not allow this because when you do this at scale, you find out that customers will realize the true value of your product over time and if you significantly overcharged them at the time of signing up, you will lose trust, have trouble renewing and getting referrals. So grossly overcharging just because they are willing to pay is generally a poor business decision. The fly-by-night operations are more likely to do what you are saying but fly-by-night ops aren't limited to sales-rep model.