We recently went through the exercise of pricing our new enterprise software product. Although there were similar products already in the market, bundling and discounting strategies made it difficult to assess the price. Our approach started by checking willingness to pay and testing various price points with the target users. This allowed us to narrow the range. We then attempted to quantify the key elements of our user validated value proposition. This set an upper bound for the price. We also looked at substitutes to our solution. In our case, the substitutes had poor price-performance ratio which allowed us to place this as a low bar on the price. We then picked a range of price points depending on the pricing objective. This was a very interesting exercise given that this was for a brand new product and hence we had no history to assess price sensitivity and also demand.
How have you priced your enterprise software? What methods have you used?
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