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"My hunch is that most companies could increase revenue by simply adding a very high-end offering, even if they never sell a single one of those expensive units
by bmelton 17y ago
"My hunch is that most companies could increase revenue by simply adding a very high-end offering, even if they never sell a single one of those expensive units."
This strikes a parallel to something 37Signals once said, many moons ago, though I believe I had misinterpreted their point. When they said it (or when I read it,) I assumed it meant that you should definitely throw a premium option out there because there are some people who always buy the premium option... even those who wouldn't consider buying a less-than-premium option.
It honestly never occurred to me that its primary purpose is to make the other prices look smaller by comparison.
- callmeed 17y agoI think there is an aspect beyond simply a perceived savings–especially if your web app is B2B. In our two main products we sell more of the mid and higher priced options. My theory is that business owners (especially sole proprietors) like to think of their company and needs as bigger than they actually are ... "I can't get just the start/basic/hobbyist/limited plan. I need the veteran/professional/unlimited/premium plan." So, in our experience, customers may not always buy the highest offering, but they will rarely buy the lowest offering.
- lamby 17y ago> business owners (especially sole proprietors) like to think of their company and needs as bigger than they actually are Do you think that's an aspirational viewpoint, or that they are actually poor at judging their needs?