Pricing Discussions for software deals

Picture this: You have a few different packages of your software. Each of the three scales up in terms of functionality and pricing. Most of the time, your prospects are best fit for the larger of the three, but always want to start small and scale up to the added functionality/more expensive packages.


What are some strategies you'd typically employ to get them in at the higher level right out of the gate?

๐Ÿ‘‘ Sales Strategy
๐Ÿ“ˆ Closing
๐Ÿ˜Ž Sales Skills
8
mitts2
Politicker
10
Account Executive
I like this question. My suggestion is if you are presenting 3 options, make option 2 the one you think best fits the clients need / size. Option 1 is still a solid win but maybe takes out some functionality. Option 3 is an extra win. Human psychology will push your client to take the middle option.

My general rule of thumb is to always change 2 pieces of the proposal for each option. For example, Option 1 has X volumes and X functionality. Option 2 = higher volumes + more functionality. Option 3 = higher volume, same functionality, longer term contract.ย 

Last thing, if the client wants to "start small" or do a "crawl, walk, run" approach, I say "fine happy to do that, just know that the unit economics of each project will be more expensive if you add stuff one at a time rather than as a package right now". That leaves you in a position where they can either take everything now and you get what you want or you get a smaller chunk up front but more over the long term.
dialnational
Member
1
Account Executive
love this answer thank you

barney2021
Tycoon
1
Account Executive
I have something very similar. I always go for number 3 and recommend this. They can always go down but mentally itโ€™s hard to go up.
SaaSguy
Tycoon
0
Account Executive
This is exactly how our pricing page on our website works! There is a "most popular" tagline on the middle tier.
Flippinghubs
Opinionated
0
Account Executive
^ย 
FormerStartupJobHopper
Tycoon
2
AE
If you can upcharge, upcharge the shit out of the smaller options and start closer to list on the larger. If you're discounting, make the larger package to good to refuse
mitts2
Politicker
3
Account Executive
I like where your head is at but I might push back a little here and suggest that price should not be the main focal point of each option. SaaS offerings included a lot of factors (usage permissions, tool sets, support tiers, onboarding costs, event limits, licenses). These are levers that can be manipulated to create different package options. Changing more than just price makes it a conversation of "what does the client actually care about" cuz often times (arguably most of the time) it is not about price / discounts.
Sunbunny31
Politicker
2
Sr Sales Executive ๐Ÿฐ
+1 to this.ย  Part of the process is to uncover what is of value to the customer.ย  Once you've done that, you can present the appropriate package to them and express how what you've done is the result of responding to the requirements they have.ย  ย  You can also carve out some things that don't matter to them, or things they want to do "later" to justify a lower price, rather than just discounting.
dialnational
Member
0
Account Executive
another challenge is 2/3 options are on the website. the largest & 3rd is "request more info"
mitts2
Politicker
1
Account Executive
"request more info" = more flexibility in my book. Goes back to understanding what the client wants. If website options 1 and 2 don't satisfy what they want. Option 3 is where you get to lead the dance.
Diablo
Politicker
1
Sr. AE
For me: I create price vs value sheet that I share with my customers e.g. plan1 might be good for them but lacks X feature that might become thei requirement, plan 2 is the best match with the features they need and if they sign up for an annual deal, they save x% + we will give dedicated support, plan 3 has way more features and if they decide to upgrade + I would give ex 2 free license if they upgrade by next qtr, they can do anytime.

This is a generic example but I try to customize it depending upon the pain points I discovered during meetings.
SaaSguy
Tycoon
0
Account Executive
You can paint a picture of it being cumbersome to upgrade and it it being easier on your team and theirs to start at a higher tier off the boat - position some incentives on a multi year/multi prod to make it more palatable.ย 
CharmingSalesGal
Politicker
0
Account Executive
Why do you want to start small? I ask because I personally find it hard to work uphill than downhill... Also selling software.
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