AMA: PayFit Former Global Director, Product Marketing, Yannick Kpodar on Pricing for Growth and Profitability

Step 1: Get access to biz ops data to understand business performance (clients per pricing plan, discounting per pricing plan, size of the company per pricing plan) Step 2: Analyze the business opportunity to build a business case for a new product or pricing launch. Step 3: Speak to sales to understand why we win or lose deals. Speak to Customer Success to understand what customers are requesting and why. Step 4: Align with Product on what to build based on business and customer goals. Step 5: ...Read More

You'll see different scenarios in different companies based on industry, size, skills, or company history. At PayFit, Product Marketing owns the topic, but we work very closely with product and biz ops. Product Marketing owns the project, but it's typically a cross-functional decision in the end. Finance, Product, Biz Ops, and Sales generally are substantial stakeholders in the process. Product marketing will review current sales performance, customer repartition by pricing plans, discount, etc. ...Read More

Pre-launch:You won't always know if you have the right pricing from the beginning. You're always going to have some elements that need to be validated. Your best bet is to always speak to sales, speak to customer success, and speak to customers before making a call. You should also have a look at the competitive landscape to see what's working.  Post-launch:You'll have to pay close attention to conversion rates from traffic to demo, demo to a customer, customer to upsell. Are we converting more ...Read More

A few key learnings: Involve your cross-functional partners as early as possible. The worst thing you can do is come up with a new strategy, but Sales or Account Managers don't believe it. They will usually end up not selling it or using it as a discounting lever. Make sure you can make the changes in the product. If you are thinking of adding or changing new features into different plans but your product team can't technically move things from one plan to another or create add-ons. You're in tr ...Read More

This is a tough one. Each market will need to have a tailored approach but don't make it more complicated than it needs to be. At PayFit, we have similar pricing and packaging structure across all our countries, but the actual numbers will differ based on local dynamics. We also include some service add-ons specific to each market when needed. However, the overall target market (SMB) and product (payroll + talent management) will be the same.  It's also easier for monitoring business performance ...Read More

Customer willingness to pay is crucial. You can create a product, but if it's not seen as a must-have for your customer, they won't purchase. Focus on building a product that meets a real need, which is core to a business' toolbox. An easy way of prioritizing new feature development is to ask your customers. We have a customer/user community where we ask them to prioritize certain features and ask them why before we develop them.  If you build a product and your customer doesn't purchase, you kn ...Read More

There are multiple turning points when you should think about reviewing or changing pricing; You're losing too many deals to the competition Constant feedback from your Sales team that pricing and packaging needs a revamp You're expanding your product portfolio You're entering a new market You recently got acquired Too many customers are churning (although it could be for other reasons) Reached an MRR or Customer acquisition milestone In sum, lots of different events could create an excellent op ...Read More

In-house will usually be a great learning experience. You can run this project if you operate as a unit and work with your cross-functional partners. Consultants can add a ton of value, but they come at a steep cost. We decided that we could do it on our own, and we were right :) But I recommend talking to as many pricing folks in your industry or other industries to learn from them. Some mistakes are avoidable. The only consulting firm we spoke with was Simon Kucher. Have a look at these slides ...Read More

Get them involved as quickly as possible. I run a monthly win/loss meeting with my Sales team to understand why we win and why we lose. Based on this information, there's usually tons of info to guide you in improving your pricing and packaging. Are you seeing more deals won from a specific vertical, buyer persona, or package? It might be an excellent time to be optimizing for that pricing, feature, or vertical.  Opinions get you in trouble but data tells the story. Focus on the data. Look at MR ...Read More

The most challenging piece here is that you're flying with little internal data. You're operating based on assumptions. You can create pretty business plans with ideas of traffic, lead, and demo conversions but you're only in the game once you get your first sale. From there you can learn more intimately of why they bought, how they made their decision, who was part of it, and what needs they are looking to meet. My advice here is to always build an MVP, test, validate your hypothesis before you ...Read More