Technology Lifecycle Pricing (Part 2): Using Segmentation to identify Customer Needs (and Willingness-to-Pay)
It is helpful to view segmentation and packaging as tools to express the true value you're providing to the highest percentage of potential customers.
After choosing their revenue model and expanding their customer base, companies will eventually begin to find themselves with one of several telling issues. More often than not, as a result of a product offering that has become much more robust that Version 1.0, the company has opened up an addressable market that is much larger and more diverse than what they were originally targeting. Eventually this diversity manifests itself with several distinct cohorts of customers with slightly different WTP curves.
Key takeaways from this webinar:
- Segmentation and packaging are not something that needs to be done off the bat, companies often hold off on differentiation until credibility in the market has been gained, additional features, functionality, and support are developed, and it is clear that a simple selling motion is outweighing monetization opportunities.
- Most companies think of segmentation as differences based on demographics, but it is more actionable to think about it in terms of needs and willingness-to-pay.
- You can use product packaging and positioning to align with segment needs and simultaneously drive both adoption and revenue growth
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