Three-tier pricing strategy for SaaS Is It Effective? Ideal? -
What is the best number of subscription levels for a SaaS company?
Research studies have shown that 3 is the most common number, but do you think it is the best?
This isn't what we discovered when we looked at the price plans of top-of-the-line SaaS businesses in our pricing pages for 2022 report.
We took a look at the pricing webpages of 50 businesses which had been rated among the top by G2 and discovered that the number of plans offered either annually or monthly that were offered ranged from no plans from zero to 23 plans.
From zero to 23 Plans The Most Popular SaaS Companies Customize Their Subscription Plans
Packaging of their goods varied as much.
"Keep everything simple" is the standard advice offered to SaaS enterprises in regards to pricing and plans. But the offerings of subscriptions to top businesses aren't simple.
In this piece we'll examine how the top SaaS businesses market and bundle their subscriptions and offer a variety of instances of tiered pricing.
Three Tiers don't mean Simple Strategies
Three-tier pricing strategies are common. The most common examples are:
- The cheapest option for small individuals, groups of singles, or for new users trying the program.
- The middle-tier can be used for offer upsells. The middle-tier is usually referred to as the "most wanted" or "most cost-effective" choice.
- Plans with premium prices for those who require more.
This is true for the top companies that use a three-tiered pricing model but the way they price their products might not be as simple.
Pricing Changes Based on Number of Users
In this instance, Canva uses three tiers however, the price of each one is based on the number of users.
Three Main Plans as an Activation Point
Airbase advertises three primary tiers, but their standalone bill payments option takes customers to a completely different set of plans altogether. Customers can select from value-based pricing and volume pricing. It's a possibility to allow potential customers to decide what price they'd like to pay for.
We think that SaaS firms may initially start out with a simple three-tier approach However, the pricing and pricing is likely to get more complicated as their users require changes.
Three is now the new Four (But Five has also become popular)
According to of our findings, the median number of plans available is in fact four. However, there are several common strategies for companies that have the option of five or four pricing options.
Three Primary Plans plus an Enterprise Plan
The reason this is effective: It is possible to create the middle option that offers small and medium-sized customers (i.e. clients who aren't enterprise clients) an ideal target to aim for.
Three Primary Plans as well as Two Enterprise Plans
Some companies, such as Box have moved to five plans that include two enterprise plans. Why shouldn't business customers have alternatives as well?
Free Plan with three paid options
If you are using an unpaid service, then the four pricing options be an excellent idea. Paid customers require room for growth to higher tiers.
Free Plan and Four Paid Options
It is also vital to be aware that adding a fifth option gives your clients more flexibility to increase their prices. In addition, when adding additional levels, it needs to be very clear on what the benefits are of moving to a costlier. In this instance, TalentLMS differs on account of the amount of customers.
Examine the concepts of the Plan
When we looked at the pricing page for the book, it wasn't necessarily clear what needs to be defined as an monthly or annual plan.
One example is that OneTrust Pro uses an A-la-carte approach to creating monthly plans.
Like that, Datadog offers a wide number of plans, based upon the many services they offer.
Instead of promoting tiers with set prices Instead of promoting tiers with set prices, it is Rippling that is the only business who creates customized plans.
A sign that it's the moment to look at the structure of your tiered system is when you're getting feedback from potential customers, or clients that are paying for functions or features that they don't utilize. Another indication is when you've got different products which the current customers purchase independently.
The top of the line SaaS firms think beyond the box with regards to pricing and their packaging. If you're looking to enhance the structure of your pricing and tiered pricing, maybe it's moment to allow your to look outside the box, too.
Create Plans (and/or Pages) in the event that You Target New Markets
A company such as ButterCMS provides market coverage that ranges with small-sized businesses and growing to huge corporations. Each persona's primary is a different persona with the specific strategy they have. If you're trying to market to a different market be sure that you've included them in your pricing pages before you reach out to them or start your marketing campaign.
Consider Different Pages or Tabs that are geared towards specific Markets
36% of the companies we studied utilize multiple pricing pages or tabs that cover multiple markets or offer separate plans to cover different types of products.
Tabs, which are similar to ones Mailchimp employs, makes it easier to look at all pricing on one page even when they're promoting three distinct product lines. Tabs provide clear distinction between the three offerings.
HubSpot is taking this one step further by offering two different tabs with tabs that offer a variety of plans and products, as well as one for bundles. It's sometimes not all regarding moving to the next stage. If you're selling several items, should you be able to combine these products?
How Else Are Best-in-Class Companies Explaining Their Plans?
Top-of-the-line companies might use different pricing structures, but we found a variety of common methods that describe how their pricing works.
The most popular price page features include:
- An FAQ section (72 percent)
- Mentioning plan add-ons (42 percent)
- It is this plan that is most popular (36 percent)
What are you looking for in an Subscription Management Solution?
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