Many companies say that a discount is an investment, but they don’t really treat it that way. There is no analysis of the scale of the investment and the expected return, and when there is, there is seldom any follow-up to see if the return on the discount was realized. In this article, the author outlines several common types of discounting as well as common pitfalls of these approaches and best practices for implementation. Although the examples are B2B and Software-as-a-Service (SaaS) specific, the pricing insights in this article are applicable for pricers across industries.
It is time to shift from “growth at all cost” to “sustainable profitable growth,” or as we like to call it: “better growth.” To fight increasing sales cycles, lower win rates and decreasing NRR, packaging and pricing should be the first point on the agenda of your next board meeting, as the authors explain.
Streaming services have begun coming around to the revelation that they cannot spend endless piles of cash on content creation indefinitely. They have to innovate to grow their subscriber base. Some innovations – such as alternative pricing models - have been successfully launched, some are still in progress, and some companies are having to change their game plans, leadership, or sometimes even both, as the author explains.
There has long been an assumption that Software as a Service (SaaS) companies will become profitable as they scale, so that as long as you are on track for rapid growth, the profits will come. This belief is now being called into question. SaaS companies have real costs and how those costs change with scale has become an open question for many companies. To be successful in today’s changing economic climate, SaaS companies need to understand the relationship between value, price, and costs and how these change with scale, as the author explains.