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Pricing Strategy: What are the best practices when converting an annual membership model to a per use transactional model?
LJ
LJ
Loic Jeanjean, Vp Growth at Canadian FinTech SaaS answered:

Hi,

interesting problem for sure. As Jon eluded to in his response, you probably want to ask yourself the following question: "How well do I really know our customers". I would recommend that you think about your ideal customers and answer the following questions:
- what value they're looking to gain
- what features they think are most important
- what they're most willing to pay

Without knowing what your ideal buyer needs and wants, it is difficult to set the right pricing strategy or understand their willingness to pay for your product. You may find different buyer segment by doing this research, and that's ok. This data will help you create a tiered approach to your pricing where you package the features that are the most important to our buyer personas (and that they would be willing to pay for)

Once you know this, one thing you may consider is doing a small user testing experiment on your new packaging, then A/B test it on your website.

This whole process is called 'value-based pricing' and this how you get to increase your average ARR per client.

Happy to talk to you more about this.
- Loic

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