How to create and earn SaaS | Part 14 | Somersaults with prices
And yes, I continue my series of extremely practical posts about SaaS. While the engineers of the team are finishing the assembly and testing of a fairly niche DentalCloud start-up, I will allow myself in the context of NPD (new product development) to speculate on how we approached a) pricing and b) service pricing plans. We will announce DC later, well, and whether it is necessary to simply announce it on a respected audience Habrahabr, I do not even know.
Prices
Classic in the price of SaaS
')
In forming prices for SaaS, there is a very good approach to the transition. In the “classical” migration scheme, we simply take a “box” and divide its cost by a) 3 years without a customer buying hardware for software. b) 5 years with iron. An example of such a detailed case was published by cloud expert Mikhail Kozlov for the company's unified communications system . We did not have “boxes” - i.e. there was no continuity of “license - service” and we had to form prices by other methods and there were nuances.
Somersaults with prices / what we did for pricing
We looked at the market itself and the audience;
We looked at the competition;
We thought about the values ​​and problems that are solved by the functionality of the service for customers;
We looked at the ceiling and decided not to use this method ("prices from the ceiling").
a) The market for the automation of dentistry turned out to be very narrow - there are a total of 7,000 offices and clinics in Russia and 80,000 dentists. The market rotation (new offices) is 10-15% per annum. There is a tendency to reduce small offices and the “overflowing” of doctors to clinics. The very audience of the service is more than solvent. We see our small clients as potential clients and those who are planning business development.
b) The average check for a niche is higher than the average SaaS check as a whole, but we made it twice more. At the same time, they decided not to make freemium and hold promotions in the first six months, which will help to be approximately equal in value with competitors. This is a logical step - stocks can begin and end, change and adapt to the current situation of development. that is, stocks in our strategy are tools for regulating price elasticity.
c) At DentalCloud, we placed the right emphasis on the treatment process - this is our UTP (unique selling proposition). Everything is built precisely not around tooth treatment, in the context of a rather detailed treatment map and qualitatively from the point of view of UX. that is, our service is not about management, but about making the work of a doctor more comfortable. Plus, we give quite a strong functional communications "doctor-patient", which is valuable for CRM clinic.
d) This is such a joke
What we did not do when pricing
We did not look at the average SaaS check, which is about 500 rubles for the workplace per month for all segments of automation - I think that all vendors are at a price lower than the utility of their solutions.
We did not ask the opinion of potential users. Perhaps this is a mistake, but we will check it later.
Also, we did not look at western competitors - they are simply not visible on the Russian market in the segment and did not evaluate cases of savings and increased economic indicators from the service. The latter is very interesting and has to be done with future customers. As a result, we received a check for a license 2 times higher than the value of the Russian competitors and the cost of the minimum tariff of 3,500 rubles.
It is important that we refused to give away free service. The refusal of freemium was caused not by the team’s understanding that it’s not necessary for the doctor to take out its functionality — it’s just not logical to give the freemium treatment process. But we did not stop to think about user scenarios with possible-free functionality due to the fact that we are new and it will be difficult for us to play in a busy niche.
Tariffs
Honestly, SaaS is great in terms of misunderstanding, as it should be right. Right from the point of view of licensing and / or providing services without them ( I already wrote about this ). In other words, there is a situation in the market that there are several options for distributing SaaS - licenses and services without them, but with licenses for telematics and SLA for access. Those. the hypothetical price of the tariff for the end user is not equal to the cost of a software license - the SLA service, several licenses, training, and anything or vice versa can “stick” to the price — there may be no license, or there may be a tariff arising from closed vendor considerations! That's it. We at DentalCloud are not an exception to the uniqueness of the approach to how to distribute soft and here's why. We have an interesting licensing structure (yes, I am a supporter of licensing). There are 2 functional modules "Administrator" and "Doctor" ("Administrator", not the one who distributes access rights, but the one who runs the clinic). At the same time, we had to make 2 price offers for small offices and clinics, provided that the functionality was the same (we want to earn more money at the clinics). The solution of the problem was this - we introduced the third license “Collaboration” and included it in the tariff for clinics, thereby increasing the cost of the tariff (but not the license, which is important) and formed the service on the basis of licenses and with our own tariffs.
As a result
- we offer the user tariffs based on a combination of licenses - Cabinet (with one license of the Doctor and one license of the Administrator) and the Clinic (with N licenses of the Administrator, N licenses of the Doctor, N licenses of the Joint Work);
- in fact, the tariffs are equally functional, but differ in the total cost due to the inclusion in the Clinic tariff of the licenses of joint work of doctors;
- we still provide the service and refused to be exempted from VAT, but not a service without telematics and access guarantees by our skills - we just provide the service, in fact, by transferring the login-password pair without access guarantees (no license for telematics);
- made 2 different offers to different segments of potential customers and were able to maintain continuity to the software - licenses
- we can always claim exemption from VAT;
- Profit!
Like other / expert opinions
Dmitry Chistov CEO Sopiny , business angel
When we were in Copiny for the price of products, we were primarily focused not on competitors, but on the value that we
we create for clients. If we save on the support of 300 000 rubles per month, then why not take 10-20% of this amount? Our foreign colleagues do the same, only their prices are 5-10 times higher.
In another Teamdesk project, where I will be an investor, the price was set on the basis of the existing helpdesk systems on the Russian market, taking into account our positioning. Here we are tightly tied to
competitor prices and customer expectations. In any case, there is no ideal price - you need to test different approaches and adjust your pricing to the current situation.
Vychelav Davydenko CEO Witget , business angel
The issue of pricing is very important both for us and for our clients, therefore at the very beginning of work on the whitellows it was decided that our business would be with a human face. That is, so that people can first assess what is offered to them, and only then pay. And pay in the amount that suits the specific client. So, we have a free version, a test version. That is, a person does not buy a cat in a bag. We were repelled by the fact that a person who has one site and who needs one witth makes sense to offer a minimum rate. And for those who need to use a lot of different vitzhetov, and, on several sites, track detailed statistics and get advice from a personal manager, respectively, will have to pay more. In addition, we give the opportunity to save money if you pay the fare in advance.
As for the specific amounts, we persistently tested. The price for the cheapest tariff was 500 p. And 750 p. and 1,000 p. Then we looked at how elastic the market is, how it reacts to price changes. In addition, they tested various discounts for payment for a longer period of 3, 6, 9 and 12 months. And, again, experimented with discounts from 30% to 70%. Experimental method came to what they came to!
Katerina Kosterova CEO Terrasoft
As for the sale of SaaS - definitely, we sell as licenses. The main reason is precisely in the legal plane.
As for prices, we have two benchmarks - western competitors and buyers' readiness. We balance between these two indicators. In addition, each product has packages focused on different market segments. For example, in the bpm'online sales product there is a team package focused on small companies, and there is an enterprise package for large businesses. The difference in price - 3 times. But the consumer segment is completely different!
Askar Rakhimberdiyev CEO Moysklad
There is no license concept in MoiSklad. We provide a service, but do not sell licenses.
For My Warehouse, the tariff line was formed quite simply.
The first factor that limits tariffs from above is alternative solutions, that is, packaged software. A subscription for a year should not cost much more than a license (theoretically, indefinite). Comparing prices, users take the cost of a cloud service subscription for one year.
The second factor is that each tariff has a cost price. It consists of the work of support services, hosting, the cost of document management with the client. It would be a good idea to calculate this figure in order to see the minimum cost of the tariff, which is not yet lucrative for the provider.
The third factor is that it is difficult to earn at too low tariffs. Therefore, in MyStock, the basic set of features for one user is free. Let these companies grow quietly until they need extended functions or more jobs.
Maria St. Petersburg Commercial Director Airi.rf
As an economist, I understand that in any process, there are several points that determine the price. Of course, this includes the cost of production and the psychologically acceptable price level, that is, the price level in our market segment, and a number of other factors. But as an entrepreneur and commercial director, I tried to include some psychological aspects in the development of the tariff grid, which would seriously help in making a purchase decision, because it is in the SaaS service that we do not see our consumer, therefore we cannot directly influence his decision. I will not reveal all the secrets, here are just some of them:
1) a service or product must be worth something. Even free tariffs are made on the basis that one day the customer will want to pay for it. The cruel reality is that once you try a “freebie”, every effort will be made to continue to use it. Production costs while no one cancels. Therefore, even at a free rate, we have introduced a "connection cost". This amount is always equivalent to the first paid rate. We charge it on the balance, and in the case when the site traffic grows to the volume of the first paid tariff, we allow it to be used as the first monthly payment. Thus, we compensate the costs, and the consumer does not have a psychological barrier between “freebies” and “you have to pay for everything”.
2) the tariffs themselves are differentiated by the traffic volume of the site, which the service passes through, the volume and quality of technical support and the “grade” of the service itself. Initially, there was a thought that the consumer would make decisions based on the “grade”. But often customers do not pay for the service as such, but for the amount of service provided: for example, technical support 24/7 or the possibility of service by telephone.
3) Airi actually has more tariffs than we declare on the site, but due to the psychological peculiarity of the decision-making on price, we carried out on the pricing page only 3, and, as it is easy to guess, the most purchased one is average and extremely high price, solely because of the "maximum acceleration" in the description of the tariffs.
Alexey Kalachnikov
Advisor DentalCloud
Materials series "How to create and earn on SaaS"
Prices
Classic in the price of SaaS
')
In forming prices for SaaS, there is a very good approach to the transition. In the “classical” migration scheme, we simply take a “box” and divide its cost by a) 3 years without a customer buying hardware for software. b) 5 years with iron. An example of such a detailed case was published by cloud expert Mikhail Kozlov for the company's unified communications system . We did not have “boxes” - i.e. there was no continuity of “license - service” and we had to form prices by other methods and there were nuances.
Somersaults with prices / what we did for pricing
We looked at the market itself and the audience;
We looked at the competition;
We thought about the values ​​and problems that are solved by the functionality of the service for customers;
We looked at the ceiling and decided not to use this method ("prices from the ceiling").
a) The market for the automation of dentistry turned out to be very narrow - there are a total of 7,000 offices and clinics in Russia and 80,000 dentists. The market rotation (new offices) is 10-15% per annum. There is a tendency to reduce small offices and the “overflowing” of doctors to clinics. The very audience of the service is more than solvent. We see our small clients as potential clients and those who are planning business development.
b) The average check for a niche is higher than the average SaaS check as a whole, but we made it twice more. At the same time, they decided not to make freemium and hold promotions in the first six months, which will help to be approximately equal in value with competitors. This is a logical step - stocks can begin and end, change and adapt to the current situation of development. that is, stocks in our strategy are tools for regulating price elasticity.
c) At DentalCloud, we placed the right emphasis on the treatment process - this is our UTP (unique selling proposition). Everything is built precisely not around tooth treatment, in the context of a rather detailed treatment map and qualitatively from the point of view of UX. that is, our service is not about management, but about making the work of a doctor more comfortable. Plus, we give quite a strong functional communications "doctor-patient", which is valuable for CRM clinic.
d) This is such a joke
What we did not do when pricing
We did not look at the average SaaS check, which is about 500 rubles for the workplace per month for all segments of automation - I think that all vendors are at a price lower than the utility of their solutions.
We did not ask the opinion of potential users. Perhaps this is a mistake, but we will check it later.
Also, we did not look at western competitors - they are simply not visible on the Russian market in the segment and did not evaluate cases of savings and increased economic indicators from the service. The latter is very interesting and has to be done with future customers. As a result, we received a check for a license 2 times higher than the value of the Russian competitors and the cost of the minimum tariff of 3,500 rubles.
It is important that we refused to give away free service. The refusal of freemium was caused not by the team’s understanding that it’s not necessary for the doctor to take out its functionality — it’s just not logical to give the freemium treatment process. But we did not stop to think about user scenarios with possible-free functionality due to the fact that we are new and it will be difficult for us to play in a busy niche.
Tariffs
Honestly, SaaS is great in terms of misunderstanding, as it should be right. Right from the point of view of licensing and / or providing services without them ( I already wrote about this ). In other words, there is a situation in the market that there are several options for distributing SaaS - licenses and services without them, but with licenses for telematics and SLA for access. Those. the hypothetical price of the tariff for the end user is not equal to the cost of a software license - the SLA service, several licenses, training, and anything or vice versa can “stick” to the price — there may be no license, or there may be a tariff arising from closed vendor considerations! That's it. We at DentalCloud are not an exception to the uniqueness of the approach to how to distribute soft and here's why. We have an interesting licensing structure (yes, I am a supporter of licensing). There are 2 functional modules "Administrator" and "Doctor" ("Administrator", not the one who distributes access rights, but the one who runs the clinic). At the same time, we had to make 2 price offers for small offices and clinics, provided that the functionality was the same (we want to earn more money at the clinics). The solution of the problem was this - we introduced the third license “Collaboration” and included it in the tariff for clinics, thereby increasing the cost of the tariff (but not the license, which is important) and formed the service on the basis of licenses and with our own tariffs.
As a result
- we offer the user tariffs based on a combination of licenses - Cabinet (with one license of the Doctor and one license of the Administrator) and the Clinic (with N licenses of the Administrator, N licenses of the Doctor, N licenses of the Joint Work);
- in fact, the tariffs are equally functional, but differ in the total cost due to the inclusion in the Clinic tariff of the licenses of joint work of doctors;
- we still provide the service and refused to be exempted from VAT, but not a service without telematics and access guarantees by our skills - we just provide the service, in fact, by transferring the login-password pair without access guarantees (no license for telematics);
- made 2 different offers to different segments of potential customers and were able to maintain continuity to the software - licenses
- we can always claim exemption from VAT;
- Profit!
Like other / expert opinions
Dmitry Chistov CEO Sopiny , business angel
When we were in Copiny for the price of products, we were primarily focused not on competitors, but on the value that we
we create for clients. If we save on the support of 300 000 rubles per month, then why not take 10-20% of this amount? Our foreign colleagues do the same, only their prices are 5-10 times higher.
In another Teamdesk project, where I will be an investor, the price was set on the basis of the existing helpdesk systems on the Russian market, taking into account our positioning. Here we are tightly tied to
competitor prices and customer expectations. In any case, there is no ideal price - you need to test different approaches and adjust your pricing to the current situation.
Vychelav Davydenko CEO Witget , business angel
The issue of pricing is very important both for us and for our clients, therefore at the very beginning of work on the whitellows it was decided that our business would be with a human face. That is, so that people can first assess what is offered to them, and only then pay. And pay in the amount that suits the specific client. So, we have a free version, a test version. That is, a person does not buy a cat in a bag. We were repelled by the fact that a person who has one site and who needs one witth makes sense to offer a minimum rate. And for those who need to use a lot of different vitzhetov, and, on several sites, track detailed statistics and get advice from a personal manager, respectively, will have to pay more. In addition, we give the opportunity to save money if you pay the fare in advance.
As for the specific amounts, we persistently tested. The price for the cheapest tariff was 500 p. And 750 p. and 1,000 p. Then we looked at how elastic the market is, how it reacts to price changes. In addition, they tested various discounts for payment for a longer period of 3, 6, 9 and 12 months. And, again, experimented with discounts from 30% to 70%. Experimental method came to what they came to!
Katerina Kosterova CEO Terrasoft
As for the sale of SaaS - definitely, we sell as licenses. The main reason is precisely in the legal plane.
As for prices, we have two benchmarks - western competitors and buyers' readiness. We balance between these two indicators. In addition, each product has packages focused on different market segments. For example, in the bpm'online sales product there is a team package focused on small companies, and there is an enterprise package for large businesses. The difference in price - 3 times. But the consumer segment is completely different!
Askar Rakhimberdiyev CEO Moysklad
There is no license concept in MoiSklad. We provide a service, but do not sell licenses.
For My Warehouse, the tariff line was formed quite simply.
The first factor that limits tariffs from above is alternative solutions, that is, packaged software. A subscription for a year should not cost much more than a license (theoretically, indefinite). Comparing prices, users take the cost of a cloud service subscription for one year.
The second factor is that each tariff has a cost price. It consists of the work of support services, hosting, the cost of document management with the client. It would be a good idea to calculate this figure in order to see the minimum cost of the tariff, which is not yet lucrative for the provider.
The third factor is that it is difficult to earn at too low tariffs. Therefore, in MyStock, the basic set of features for one user is free. Let these companies grow quietly until they need extended functions or more jobs.
Maria St. Petersburg Commercial Director Airi.rf
As an economist, I understand that in any process, there are several points that determine the price. Of course, this includes the cost of production and the psychologically acceptable price level, that is, the price level in our market segment, and a number of other factors. But as an entrepreneur and commercial director, I tried to include some psychological aspects in the development of the tariff grid, which would seriously help in making a purchase decision, because it is in the SaaS service that we do not see our consumer, therefore we cannot directly influence his decision. I will not reveal all the secrets, here are just some of them:
1) a service or product must be worth something. Even free tariffs are made on the basis that one day the customer will want to pay for it. The cruel reality is that once you try a “freebie”, every effort will be made to continue to use it. Production costs while no one cancels. Therefore, even at a free rate, we have introduced a "connection cost". This amount is always equivalent to the first paid rate. We charge it on the balance, and in the case when the site traffic grows to the volume of the first paid tariff, we allow it to be used as the first monthly payment. Thus, we compensate the costs, and the consumer does not have a psychological barrier between “freebies” and “you have to pay for everything”.
2) the tariffs themselves are differentiated by the traffic volume of the site, which the service passes through, the volume and quality of technical support and the “grade” of the service itself. Initially, there was a thought that the consumer would make decisions based on the “grade”. But often customers do not pay for the service as such, but for the amount of service provided: for example, technical support 24/7 or the possibility of service by telephone.
3) Airi actually has more tariffs than we declare on the site, but due to the psychological peculiarity of the decision-making on price, we carried out on the pricing page only 3, and, as it is easy to guess, the most purchased one is average and extremely high price, solely because of the "maximum acceleration" in the description of the tariffs.
Alexey Kalachnikov
Advisor DentalCloud
Materials series "How to create and earn on SaaS"
- Part I / remove all unnecessary, hit the target, experiment
- Part 2 / invaluable experience of Russian ISV
- Part 3 / sales through an affiliate channel that may not be needed
- Part 4 / Startta Quickme - communication and collaboration of small teams
- Part 5 / pervasive SaaS integration, how nice the threat is to the rest of the software business or how 1 + 1 turns into 3
- Part 6 / Quickme story for partners or 7 reasons to do things together
- Part 7 prefinal / why not sell SaaS?
- Part 8 - FINISH / SaaS - the realities of the Russian market
- Accidentally forgotten Part 9 / Legal SaaS fog
- Part 10 / Business Model Metrics
- Part 11 / Cloud Services Reviews / UX and Usability Testing
- Part 12 / Mobile access to the cloud revolution: how to change the operator in "one click"
- Part 13 / Three steps roaming technologies
Source: https://habr.com/ru/post/251989/
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