On a scale from of one to ten, how important is price for customers and prospects in your target market?

Assume about a 5 on a scale of 1 to 10.

Customers want a good deal, and in bigger deals, most customers want a significant “discount” to feel like they got a good deal.

But really in the end, customers need context. They are generally comfortable paying a similar amount for product X that they pay for another product that provides similar value.

Furthermore, brands are highly valued and are a proxy for quality. You can also test out a new app just so much. Most business customers will not be swayed by a non-brand just because it is a bit cheaper. Maybe if it is much cheaper, and the product feels close to a commodity. But sometimes not even then, if the leading brand is priced fairly.

Dropbox is no longer cheap, see above. It’s fairly priced though. That’s enough.

Salesforce’s price per seat is top-of-market, and 10x what is was before it had the leading brand and provided true enterprise-grade solutions. They are also doing just fine.

But if you price so high that the pricing doesn’t seem intuitively fair compared to other apps your customer buys, that can still work. But best case, it will add a lot of friction to the sales process. Is it worth it? Maybe only at the very high end.

We had a great discussion on enterprise pricing in this session at Heavybit with three B2B leaders:

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Published on August 28, 2018

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