What's your approach to pricing your startup's product or service?

Question

André J · Accepted Answer

@lavanya_snigdha Simplicity is often overlooked. I wanted to use intercom the other day. Their price: Free for startups for 12months, but trail ends at 3 months. I tried to ask customer support how that works. But they didn't know 😅

Kexin Liu · Answer

consider your cost and also the pricing strategy of competitors lol

Rishabh R · Answer

Calculate the cost associated to it

Then increase the price by atleast 5x the cost of the product

The increase the perceived value of the product by providing add ons and other features.

Create a brand around it and provide exceptional service and support for it.

Reason:

- If I get pennies, my quality of work will be low, and the service that I provide will be bad, and at the end I will have to shut down my business.

- People love business who value them and provides them exceptional support, so they will retain you

Lavanya Snigdha · Answer

Hey Vlad! Speaking from recent experience here,

Some of the things that have helped me come to a pricing plan are as follows:

- Speaking with my engineers and devops teams to ensure I have a very clear view on infrastructure costs (Get those COGS in order!)

- I wanted to keep my pricing simple. So simple that it doesn't take more than five minutes to walk my sales team through the plan. (This helps keep things simple when we're pitching to accounts, you don't want to come off as convoluted and the worst place to do that is when you're talking 💸)

- Make sure you understand how competition that you feel is undercutting their price points are actually able to justify their services (Most companies that offer 'Unlimited' whatever usually have limitations on their product usage and that lack of clarity in their pricing structure is something to leverage on calls)

I hope this helps. ✌️

André J · Answer

Depends on the market. If it's saturated (red ocean) then you have to provide a competitive price. If it's a blue ocean market then you have more flexibility.

Clau Marin · Answer

I might say first calculating your own costs, what makes sense to you to get paid for your product, what will be the worst/best price you can get, and then from that range I would actually ask people if it would make sense for them to pay such price, and come to an average.

Then, analysing how your product goes, what's working and what not and constantly adjusting the offer. I remember a quote by Alex Hormozi, saying "you don't need to adjust the price, you just need to come up with a better offer"

What's your approach to pricing your startup's product or service?

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