← SaaS Go-to-Market
Day 2 of 14
Pricing Strategy — The Lever Most Founders Pull Last
Pricing Frameworks for SaaS and Apps
Most founders underprice. This is almost universal. The reason is psychological — we know how much the product cost to build and anchor to that, or we're afraid to charge 'too much' for something we built ourselves. But customers don't care what it cost you to build. They care about the value they receive.
Value-based pricing starts with the outcome your product creates. If BathCheck saves an OT 2 hours per assessment and they bill at $150/hour, that's $300 in value per assessment. If they do 10 assessments per month, the monthly value is $3,000. Charging $99/month captures 3.3% of the value created — that's not greedy, that's reasonable SaaS economics.
For App Store apps with monthly subscriptions, consider the competitive set. But don't let the $4.99/month competitor anchor your price if your app delivers materially more value or targets a different buyer (e.g., professionals vs consumers). A $29.99/month professional tier for OTs is entirely appropriate if the value is there. The NDIS/aged care segment is notably price-insensitive relative to consumer apps — professional tools for a regulated industry command professional pricing.
Tiering, Freemium, and the Free Trial Decision
Tiering creates anchoring and upsell pathways. A three-tier structure (Starter / Professional / Enterprise or Team) works well because the middle tier is where most revenue lands — the Starter tier makes the Professional feel affordable, the Enterprise tier makes the Professional feel like great value.
Freemium vs free trial is a strategic choice. Freemium (limited features forever free) works when: (a) your product has a viral or network component, (b) the free tier provides genuine value that converts to paid over time, and (c) you can afford to serve free users. For accessibility apps with meaningful per-user infrastructure costs, freemium is often wrong. A 14-day free trial with full features is typically better — it converts at higher rates because users experience the full product value before committing.
For apps sold to institutions (aged care, NDIS providers), seat-based or organisation-based pricing scales better than individual subscriptions. An aged care facility with 20 OTs on staff will pay more per month on a per-seat model, but the per-seat price can be lower than individual consumer pricing because the purchasing decision is a business decision, not a personal one.
⚡ Today's Action
Write down your current pricing for one product. Now double it in your head. What objections come up immediately? Write those down. Each objection is either a value communication failure (you haven't explained the ROI clearly enough) or a genuine price ceiling. Identify which.
💡 Pro Tip
Run a simple price sensitivity survey using the Van Westendorp model — four questions about 'too cheap,' 'cheap but acceptable,' 'expensive but acceptable,' and 'too expensive' — before launching. Free tool at priceably.com.