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We want you to look at pricing the same way you look at other business functions, because at the end of the day pricing is the greatest leverage that you have on your bottom line.  Empower your organization to be in tune with your customers and always be optimizing for profits. If you remember nothing else from this post – remember these few points.

  • Pricing is a constant process that is fueled by tons of customer data

  • A pricing committee is the strong grip of a hand that cranks your pricing lever

  • You should be evaluating every quarter and making sure that your personas are quantified

  • You should be making minor changes every three months, and major changes every six

  • Improve your product so that you can improve your pricing. 1% increases in price yield 11% increases in profit.

PriceIntelligently

More SaaS + Software Stats

The fastest growing SAAS companies averaged $250k in MRR and were only losing around 3.2% of that revenue each month to churn

Moving from $1.5 million with an eye towards $10 million in ARR is a tough a task and will take an excellent VP of sales to get you there

Unlike many other industries, if a software company grows at only 20%, it has a 92% chance of ceasing to exist within a few years

The median cost for a SaaS company to acquire a dollar of new customer revenue is $1.18

As companies scale their growth engines, a slightly-above-average churn rate becomes harder and harder to offset with net new revenue growth, especially when the goal is to outpace it by 4x

If your Net Revenue Churn is high (above 2% per month) it is an indicator that there is something wrong in your business

Customer Acquisition Cost (CAC) = sum of all sales & marketing expenses/ number of new customers added

The median SaaS business generates 16% of its new Annual Contract Value (ACV) from upselling to existing customers

86% of SaaS businesses treat “New Customer Acquisition” as their highest growth priority, both in terms of executive support and funding available

Internet sales strategies are the only sales method to see a decline in CAC, dropping from $0.54 to $0.42 between 2014 and 2015

More Growth Strategy Stats

Getting paid in advance is really smart idea if you can do it without impacting bookings, as it can provide the cash flow that you need to cover your cash problem

SAAS companies need to track the number of visitors, trials and closed deals; And also track the conversion rates, with the goal of improving those over time

In 2017, the global adoption rate for biotech soybean amounted to 77 percent.

High-growth companies are 8X more likely to reach $1 billion in revenues than those growing less than 20%.

The average Quick Ratio of fastest growing SaaS companies (those with a CAGR of over 50%) is 3.9: generating $3.9 in revenue for every $1 lost to revenue churn

To establish a revenue or lead-commitment based on your funnel metrics and revenue-growth goals, work backward from the gross revenue amount that marketing is responsible for generating (generally around 40%)

Software and online services are in a period of dizzying growth

A 1% increase in pricing strategy yields an average 11% increase in profit

If a software company grows at 20% annually, it has a 92% chance of ceasing to exist within a few years

The average SaaS company spends just 6 hours determining their pricing strategy