SaaS Founders on Deciding Product Pricing

Preeti Karna Preeti Karna
Mar 10, 2022 3 min read
SaaS Founders on Deciding Product Pricing

Pricing plays a vital role in building relationships between the startups and customers. The business' goal is to get a greater profit, while customers want to get value for money services. The pricing needs to be optimized in a way that business and customers both get benefitted.

Here are the strategies shared by entrepreneurs of SaaS startups on pricing their Saas Products. Read to learn their SaaS pricing strategies.

Shayak Mazumder, Co-founder, Eunimart

Most subscription products need to be priced at a point that it doesn't make it difficult for the users to continue using the platform. This means that SaaS pricing shouldn't be more than 10% of the value that the user generates from the platform. So, if a user generates $1mn in GMV, their actual margins or revenues will be $150K approximately. As such, SaaS pricing cannot exceed $10K.

Robin Das, CEO of Brandintelle

Robin Das - CEO of Brandintelle
Robin Das - CEO of Brandintelle

Here are certain things you could look at when it comes to pricing of your SaaS product-

  • Analyze your products value addition in terms of efficiency increases for your customer. This is one of the main metrics via which you can demand a certain price.
  • Your pricing should not only be a function of your costs, but also a function of your value contribution. A good mix of these two is what you should target for.
  • Study your competitors. This can be a great benchmark. Note that your competitor's need not be other SaaS tools. They could also just be more manual ways of doing the same thing your product does in a better way.

Pramod Gummaraj, CEO, Aprecomm

We considered 3 main factors during Product pricing:

ROI (return on investment) the product generates - This comes from the market study and talking to customers and understanding how much a product like ours can save time & money and propel business expansion.

Competitive pricing - Our product was innovative in the industry and hence competition comparison was not available

Need - Whether our product is Good to Have or Must Have. We found the customers and markets where Aprecomm’s product is a must have and hence we could draw premium pricing.

Arjun Gupta, Founder, Courseplay

This is tough and it’s still very hard. For us it ultimately came down to value. We asked ourselves what customers would be willing to pay for our product and tweaked it every quarter based on customer feedback. We still revise Courseplay’s pricing each quarter for new customers and once a client is closed at a certain price point, that pricing is locked in for them.

SaaS Pricing Guide: How to Decide the Right Price for your SaaS Product
Deciding the right price for your SaaS product is not easy, a lot of research goes into it. So, here’s a strategy to help you decide the right price for your SaaS product.

Shreyan Gandhi - Director and Co-founder, Comket Solutions

Shreyan Gandhi - Director and Co-founder, Comket Solutions
Shreyan Gandhi - Director and Co-founder, Comket Solutions

We want tap1ce not to be a lifestyle product, not something only a niche audience can use. We’ve priced our product solely on the basis of the cost it takes to keep your links safe and encrypted. We’re only charging our consumers for the service we provide.

Sarvagya Mishra - Co-founder & Director, SuperBot (PinnacleWorks)

Sarvagya Mishra - Co-founder & Director, SuperBot (PinnacleWorks)
Sarvagya Mishra - Co-founder & Director, SuperBot (PinnacleWorks)

The SaaS products are requirement based products. However, the price bracket is curated encompassing several factors like the features, the quality of the technology, thorough market research, services required by the client, and lastly the RoI that the product offers in the end.

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