The fastest way to profitability (besides layoffs)
Status matters (especially in B2B)
You can pay $50 for a watch or you can pay $50,000. They both tell time, but one sends a message.
People spend money on products, but they throw money at status. So, if you want high margins, sell status.
And status matters even more in B2B.
After all, “Nobody ever got fired for buying Microsoft Teams.” (in a corporate, anyways 😏)
A perfect example
My friends run Leadsie, a SaaS that gives digital agencies one-click access to their clients' paid social accounts. Agencies aren’t paying for “easier client onboarding,” they’re paying to make a great first impression. They want to look established, worried new clients will think they're n00b freelancers.
Simple next step
To unlock your full pricing, figure out how your product affects your customers' status. The four questions below can help you understand your prospects' social hopes and worries around the purchase.
Interview new customers about the conversations that led up to the purchase, and have them think back to when they were first considering it:
What were you hoping this product would enable you to do?
Why was that important?
Who else cared about the outcome of this project?
How is this project viewed within your team?
As they answer, watch for emotion. When you sense some, point it out gently (e.g. "Wow, that sounds stressful" or "Oh, that would be exciting"). And then be quiet and leave space for them to elaborate on these emotions. Once you understand your customer’s social goals, reflect that in your messaging before they get to the pricing page.
Before you talk price, sell status.
I have tons of ideas about pricing, and I shared them all here in the Chartmogul SaaS Roundup podcast, including:
How to find your optimal price, even in a new category
The 2 big pricing mistakes most startups make
How to unpack your prospect’s mental math
Why lowering your price is almost never a good idea
I hope this helps! Speak soon.