Looking for resources/articles/books re: pricing your ( software ) product

[leahstig]

How do you arrive at the price of your product? I have the beta I just want to have a starting price ( or price range ) before I send it to users. Obvs this can change later, I just want to do the YC test of "are users willing to pay for it"? I downloaded some books such as Monetizing Innovation: How Smart Companies Design the Product Around the Price

But I wanted to see if YC reddit has any tips or resources they recommend. Thanks!

UPDATE: thank you for the suggestions. The book I listed above is AMAZING, exactly what I was looking for, btw.

 

[jraycaen]

@leahstig There are three things to consider 1) competitors (customers reference point), 2) what customers have paid before (to solve or almost solve the problem, and 3) your costs.

Your costs + a margin is your absolute floor and ideally nothing like what you will actually charge. You should be looking to test the upper elasticity (how much can you stretch them) based on competitors or what they paid to solve.

If you haven’t spoken to anyone find your competitors top price add 10-15% on top and go from there.

 

[leahstig]

@jraycaen Thank you so much! There is nothing exactly like what I am working on in the market but I have some pricing comparables. The book I mentioned on the post has turned out to be very helpful in helping me frame research using the "WTP" paradigm ( Willingness to Pay ).

The book has also confirmed something I had been thinking of doing which is creating different products for different markets using the same product architecture and slightly different features and seeing how elastic the pricing is depending on the market.

I created the product first for one market but as it came into life, I realized it would be useful for other markets/user problems as well. So I will test them all. I really want to avoid wasting time on non-paying users so this is super helpful. Thank you!

 

[jraycaen]

@leahstig Your welcome. Good luck

 

[leesajohnson]

@leahstig Agree with tojo on the 3 factors to look at, mostly i'd start with competitor's pricing and how you can be competitive (lower, to grab more people's attention in early stages?)

If there is nothing exactly like what you're working on the market, scale back and ask: how have people been solving the issue so far? What do they use / how much do they pay for it?

Kudos on building something different! But having competitors do help prove demand in the market / show you ways you can do it better. In this case just see what people have been doing so far without your solution yet

 

[dbhedden]

@leahstig @leahstig, Hey OP, We at PriceOps have a tool, to help figure out the price for your SaaS or software product.

We are in beta phase right now, and will launch in a few weeks, but our tool is ready to use. If you would like to explore it and see how it can help figure out your pricing happy to help.

I am also working on an online course, but it is a month or so away from being done.

Here is a link to my website https://www.priceops.net/

 

[dbhedden]

Feel free to DM if you would like to discuss offline.