Getting Pricing “Just Right”
We were recently called to task for the pricing of several of our products. It was suggested that the prices were unreasonably high. Naturally, no one would ever point out that our prices were too low, right?
Pricing is not a simple thing. For us, when we price our software, we take into account some or all of the following:
– the number of units of the product we’d like to sell in a year
We recognize that pricing, by its very nature, is exclusionary. Pricing is a component of our strategic plan for each product. The way we price a product absolutely limits the market for it. The only way to not limit the market is to make the product free. And, even then, some people won’t want the product for other reasons. If we price the software too high, too few people will purchase it. If we price it too low, we may sell a lot of them but be overrun with support calls and issues. Consequently, we attempt pricing that is “just right”, understanding that “just right” doesn’t mean “just right” for everyone.
With each of our products that we’ve had in the market for multiple years, we’ve adjusted the pricing several times. This has been a result of our own internal analysis as well as getting input from key partners and clients. In some cases, we’ve put out different versions to give consumers the choice of low cost fewer features versus higher cost more features. In other cases, we’ve kept the version the same but just tweaked the pricing up or down in a case of trying to get it “just right”.
Unlike a number of other companies in the market, we’re always open to input about our products in terms of features and pricing. We consider feedback like this to be the life blood of our business and encourage it as often as possible. It doesn’t mean we’re always going to change because of feedback we receive. However, change is definitely much more likely with the feedback than without it.
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