How many price points and packages should I offer customers?

There's no hard and fast rule here (ugh the "it depends" answer). In truth it's a function of your product maturity, your buyer's sophistication, and use case differentiation.  When in doubt, keep. it. simple.  The research is pretty clear that good-better-best works, well, best.  It focuses a buyer's mind.  The most common mistake I see are packages that are invented to solve a use case for a handful of customers.  That's how you get SKU-creep.  The order I like to start with is: When in doubt ...Read More

While there’s no perfect answer here, there can be too much of a good thing. Behavioral economics research has shown that we tend to have a hard time deciding from a large array of options. This phenomenon is known as choice overload. It’s also often referred to as the paradox of choice, being paradoxical, of course, because you’d think that more options would be better. In fact, not only is it harder to make a decision when there’s too much choice available, if we do end up making a decision, i ...Read More

If you have a relatively simple product, you don't have to offer a lot of packages. But if you have the ability to do different packages because you have enough features to merit them, then I would recommend going with three packages. Most customers will look at the three options and say, well I certainly don't want to take the lowest level because I'm not just starting out (unless they actually are!) and I don't want the highest option because I'm not gigantic so I'm going to go with the one in ...Read More

There is no one correct answer to this, unfortunately. There isn't a perfect number of pricing tiers that will unlock growth, but some research has been done that you can use as a starting point. Many people reference the power of three, and the popular good, better, best pricing strategy. This school of thought proposes that having any more than three options overwhelms the buyer and introduces increased cognitive load.  While Good, Better, Best is a common package structure, it’s not the only ...Read More