Pricing… Intelligently w/ Patrick Campbell (ProfitWell)
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Patrick helps companies price intelligently, and his companies mix services with software products or how they put it, tech-enabled services.
We talk through Patrick story, how he started with the service side of the business, but then leveraging that to fund the launch of his freemium SaaS product, Profit Well, with some premium add-ons layered on that.
Of course I couldn’t let Patrick go without picking his brain about pricing strategy and how to figure out how to price your services or your software products and where to focus your attention in those areas.
We also talk about content strategy. They’ve been doing a lot with video in the last year too, taking a new approach to that.
[4:17] From Google to bootstrapping a 10M MRR company in 6 years. Why they considered themselves a tech-enabled service and not a consulting company.
- “We found that people didn’t want to do the work [of loading the data into the platform], and this is a problem we see with most products that we see, they require the user to do a lot of work.”
- “Small changes in your price can create giant holes in your revenue or giant spikes in your revenue”
[11:58] Pitfalls trying to productize. Reconsidering business after competitors launched before you.
- “The best customer development is someone paying you to do something even though it may not be what the product ever becomes.”
[20:32] How to make Freemium model a viable business. Converting trial users in paying users.
- “If you can reduce someone’s churn you can have a really good pricing model because you can charge based on how much you’ve recovered.”
[29:05] Top of the funnel marketing content through different media.
[36:47] Pricing in Productized vs SaaS. How a service business can have 90% margins.
- “Unless you have a commodity business, the first thing to realize is that there’s no perfect pricing.”
- “A services business can have the same margins as a SaaS.”
[43:37] When does the Freemium model make sense? How to figure out the first price point? 4 questions to ask your target customers.
- “The biggest thing to keep in mind is that Freemium is an acquisition model, it is not a revenue model.”
- “As human beings we don’t see value as a point, we see it as a spectrum.”
- Patrick Campbell on Twitter
- Patrick Campbell’s companies, Price Intelligently and ProfitWell
- Blue Nile
- Josh Pigford from Baremetrics on the Productize Podcast
- How freemium nearly caused our business to implode – Baremetrics’ Blog
- Nick Franklin from ChartMogul
- Brian Balfour
- Sean Ellis