Category: Pricing

Software Economics and Slippery Slopes for Product Companies

ProductFocus’s Ian Lunn and I will talk through how software product companies make money, and how that’s in direct contrast with how software outsourcing and custom development companies make money.  Then we’ll apply that to B2B/enterprise software vendors who may have conflicting business models.

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Customer Value and What Things Are Worth

How do we understand value from the customer’s point of view, not just the vendor? How do we choose pricing units, what portion of value can we capture, and why do we have to do the math/thinking in advance for customers?

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Three Product Challenges for Entrepreneurs (Stanford)

Three perennial challenges for entrepreneurs and start-up founders are (1) seriously listening to their markets, (2) building customer-side savings/ROI logic, and (3) whole-product thinking. Tiny companies lack formal product managers, but need to apply some product management thinking to these fundamental product/market needs.

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Very simple customer savings/ROI template

One of the first things I ask about with a new product team is “how will a customer justify paying for your product?” An apparently simple question, but I often get blank stares.  Here’s a thumbnail of the problem and the process, along with a tiny spreadsheet template.

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Site Licenses and Other Real-World Intrusions

We recently finished a major pricing exercise with a start-up in the enterprise software space: tuning up their prices, improving their upgrade model, and looking at alternative pricing metrics (i.e. what to meter when quantifying the customer’s usage).  A great opportunity to match quantitative models against actual customer behaviors. During the engagement, the client’s sales

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EOL from the Customer’s POV

As seasoned product managers, most of us eventually have to phase out old versions and completely eliminate old products.  This is called End of Life (EOL) or End of Service (EOS), and is important weed-clearing.  It’s generally motivated by our internal economic needs: rebalancing resources in our product portfolio, reducing support costs, moving customers to

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