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Apr 21, 2021

Understanding your customers' decisions is fundamental to value based pricing, especially in subscriptions.  

When we think about our customers' decisions, especially in subscriptions, we want to break it up into those three different revenue buckets we talk about - Win, Keep, and Grow.

When we're trying to win a customer, a customer's making those "Will I and which one" decisions, you've probably heard me talk about those two topics or those two decisions on ad nauseum. And if you haven't, you'll find tons of content, and one of these days I'll do a memecast on those as well.  

But keeping, if we want to keep customers, what's the decision they're making? Most often, they're actually not making a decision at all. They're just using our product, they're just writing us checks or letting the credit card go through. 


“Understanding your customers' decisions is fundamental to value-based pricing, especially in subscriptions. ” - Mark Stiving  

The last bucket, grow, has a ton of different decisions that we need to focus on. Because maybe we want to raise prices on them, that's drawing attention and making them rethink. But, have we provided enough value that we're pretty confident they're not going to turn out?  

What about usage, maybe we can get them to use more? As they use more, they're willing to pay us more, and they say, "Hey, that seems fair." That's a decision that they have to make. Maybe we want them to buy more from us. Maybe we want them to upgrade into a new product or buy a different product from us. This is us thinking about the decisions our buyers are making.  

Value-based pricing is always putting yourself in the mind of your buyer. In subscriptions, there are several different decisions your customers have to make in that relationship lifecycle. And we want to think about each one of those decisions.  

We hope you enjoyed this memecast. If you see any of our memes that you'd like move to the top of our memecast list, or if you have any feedback, please email me, Now, go make an impact. 

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