Tami Bronner, February 2023

<aside> 📎 Creating your first pricing is difficult, yet it is important to start charging for your products early on. Here is a quick guide book to help you develop your first pricing:

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Process

• [ ] Good enough - This is a beginning, don't strive for perfection, start with good enough and improve as you go based on feedback.
• [ ] Listen - Pricing needs to be seen as part of #PMF, it is a process that the most important thing in it is... to listen ( and it never ends :) )
• [ ] Simple - keep it as simple as possible, simple create, simple to explain, simple to enforce, simple to understand and simple to change.
• [ ] Undercharge \ Overcharge - one of them will probably apply… make sure to adjust and don't be afraid to challenge your assumptions.
• [ ] Design partnership? Pricing should be discussed with them, they do not have to pay right away, but it should be part of your legal agreement with relevant adjustments.
• [ ] Procurement - Understand how budget approval works at your customers' companies, and what changes can be made to make the approval easier.
• [ ] Competition ecosystem - learn your competitors pricing models, as well as whether or not customers are comfortable with them.

Value

• [ ] Value - Make sure that your product's pricing reflects its value, and that you clearly communicate this value.
• [ ] Explainable Value - double down on that, you must have a clear understanding when and why customers pay more, and it must be aligned with the product core value.
• [ ] You are the salesperson - try to tell the pricing story as part of the whole product demo, make sure it is easy for you to explain.
• [ ] “Basic” Value - Customers will probably choose the “basic” plan at the beginning. Ensure that the basic plan won't negatively affect their first experience.
• [ ] Don't separate products early on - While cross-selling is a good expansion opportunity, you should ensure the customer experience is complete.

Implementation

• [ ] Enforcement - Pricing will probably change frequently, so consider something simple (very simple) at the beginning (human in the loop works great)
• [ ] Product impact - Pricing plans can drastically impact product maintenance complexity (feature toggles, etc.). Keep it to a minimum.
• [ ] Predictable - It goes without saying, especially at an early stage, customers want to know what their payment will be and to be able to control it. Getting notified and understanding how the price will change should be easy.