Fired Up and Focused Bootcamp: Day 16

Founder of Bidsketch, Ruben Gamez
Shows You How to Be Smarter About SaaS Plan Names

This video is brought to you by Bidsketch proposal software

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TRANSCRIPT

Hi. My name is Ruben. I’m the founder of Bidsketch. Today, we’re going to look at how do you rename your pricing plans so that you end up with more customers and more revenue per customer.

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It may not sound like you can just rename your pricing plans and get that sort of an impact but you really can. Think about this scenario for a moment. Imagine that you run an agency and you’re looking for an invoicing tool. Say, that you’re on the marketing site or this invoicing tool. Everything that looks good; you’re impressed and you want to see how much it cost. You end up on the pricing page and you notice that since it’s a SAAS product like most SAAS products, it has multiple pricing plans.

These pricing plans, there are only three of them. They are called, Basic, Plus and Premium. Now as somebody who runs an agency, do you know which plan to pick? Think about that, basic, plus and premium. Probably not. The only thing that you know from those plan names is that basic is the cheapest plan. Plus, is a little bit more expensive. Premium, is the most expensive plan.

What you’ll end up doing next is that you’ll probably look at the pricing. You’ll look at the features and you’ll pick the cheapest plan that will do the job for your company. That’s the way that pricing works or these pricing decisions work a lot of the times for more SAAS products. We can actually change that behavior. We can take that higher value customer, that the person who runs an agency and making more likely that they’ll pick the higher end plan, the premium plan. The only thing is you need to rename the pricing for that to happen or to make it more likely that it will happen.

Take that same scenario. This time when you hit the pricing plan or the pricing page, you notice that three plans are called Freelancer, Studio and Agency. Just because you run an agency, you’re more likely going to look at and evaluate that agency plan. You’ll probably end up picking it. That or maybe the studio plan. It’s likely that you’ll look at the freelancer plan and think, “This is for freelancers. Just one person company. It’s not right for my company.” It’s like the agency plan, just by changing the name, is tailor-made for your company or people like you. It’s almost a recommendation that you’re giving that customer. That’s basically the impact that we’re looking for. That’s what we want to happen.

After today’s assignment, that’s what you’ll be able to do. You’ll be able to pick out the important customer segments that you want to focus and then create [finding 00:03:13] that are right for them. Let’s get to it.

We’re going to walk through a few examples here just to better illustrate what I was talking about. The first one is going to be 37 signals. It’s a product they call, Highrise and it’s a CRM. Thirty-seven signals has made a lot of money and they’re super successful and all that, but they could have done a better job when it came to naming their plans. You could see here that they’re using the very generic Basic, Plus and Premium which I pulled out of the pricing page for the example that I’d mentioned before.
If you come here, you look for this pricing page. These words don’t do anything to help you decide on which plan to pick. You’re likely going to be looking at the pricing instead and the plan features. Let’s move on to the next example.

The next one is for my product. This is the pricing page for it. It’s a web application use to create client proposals and it’s used by freelancers, studios and agencies. If you look at the pricing plan names, Freelancer, Studio and Agency, exactly for that reason. Freelancer accounts are just single user accounts. Studio, a very small teams that use this sales tool. Agency, slightly larger teams that are using this sales tool.

Next example, Freckle. Freckle is a time tracking tool. This example is a little bit different, but what I like about their pricing page is that they’re focused entirely on teams. If you look at these plan names, you’ll see that it’s Small team, Medium team and Large team. If you’re a team of any sort, and you land on this pricing page, basically you know you’re in the right spot and you’ll evaluate one of these plans and really not look elsewhere.

If you’re a freelancer or an enterprise and you land on this page and all you see is Team Plans. You might dig around a little bit more and find these very small links down here for a consultant in Freelancer plan and then Enterprise plan.

I think it works really well because they really decided just to focus on one customer segment here and make their pricing grid all about that. Pretty interesting approach.

The next example here is Unbounce. Unbounce is a landing page tool. The really interesting thing about the way Unbounce is doing has named their pricing tiers is that they’re actually going after two customer segments per pricing tier.

You see here, the lowest end one is New Businesses and Entrepreneurs. The middle here is Consultants and Small business. The most expensive plan is Marketing Teams and Agencies. I do like this approach for their business but mainly because they have a very horizontal product and they have a ton of customer segments. Plus they’re very smart. They do a lot of testing. They talk to customers a lot. They probably are pretty confident about these customer segments.

If you’re just getting starting out or haven’t done a lot of work in identifying your customer segments, I would probably start off with fewer customer segments and go with something a little bit more simple. I wouldn’t recommend this approach to most people unless you have a very horizontal product and you’re very confident basically having correctly identified your customer segments.

In any case, I just thought this was a good example to show just because it’s creative and it might give you some ideas as well. How do you do this? Basically, I would start off and this is the way that I approached it. Instead of looking at my current plans, I actually started off by looking at my customer segments. Basically I just listed out all the words that my customers used to identify themselves and their business.

There are a few words that can apply to the same plan. If you look here, the Freelancer and Consultant words are basically can be used in the place of the basic plan and that’s okay. What you want to do is just basically list them all out and then go and verify by talking to customers or surveying them or maybe even just checking a few marketing websites or bios or whatever and see what words they are using the most and go with those.

In my case, I renamed or tested basic against freelancer plus against studio, premium against agency. If you have enough traffic, at least a couple of thousand visits then I would recommend split testing this. You just create two versions of the same page. Here, we have Premium, Plus, Basic. Agency, Studio, Freelancer and just test them against each other. Look at what happens. Pay attention to whether or not—even if you have the same amount of clicks. Whether or not you get more people clicking on the more expensive plans. That’s the goal here.

That should be everything that you need to get started. Good luck.

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