Pricing StrategyMay 11, 2023
In this blog post, Kristina Frost explains how m3ter can help organisations introduce pricing changes scalably and flexibly while being able to experiment with new pricing strategies safely and efficiently.
Is it possible to move fast and not break things?
When assessing a tool like m3ter, the immediate value propositions are pretty obvious: aggregations on ingest and a pricing heuristic that scales to any plan. However, there are additional benefits that play out over time — the ability to introduce pricing changes scalably and flexibly, and the ability to experiment (both in test and in production) that can offer material value to an organization and which have the potential to change how pricing strategy unfolds.
Ultimately, every pricing strategy you deploy in m3ter is its own plan, which consists of various measurements that you ingest and price. When a company evaluates a change in pricing strategy — whether moving from unit to usage-based, or changing units entirely — it’s as simple as introducing the new plan, revising your aggregations, and pricing them.
There’s a turn of phrase I picked up from colleagues in the Federal business — no good plan survives contact with the adversary — you can analyze prices, margins, costs in spreadsheets all day long with assumptions about customer behavior, but that will never be as good as real results from real customer activity.
While m3ter’s flexibility makes it easy to reprice a product, where I find it gets even more interesting is with new product launches. Offering a private alpha to a select number of prospects or users, and metering the results, can give you great inputs against your original pricing assumptions, especially if those pricing assumptions are usage-based. Simply establish your plan, and run it, without actually proceeding to bill, and you’ll find out what your customers would pay if the product was live in real life. You can do this for as many potential plans as you like — just replicate events to that plan and assess your output.
This is a terrific way to safely test your pricing assumptions against real usage before you launch and gives you a chance to tweak those inputs (easy, on a platform where you simply adjust your aggregations or prices) before your product finds its way to consumers.
It’s been popular in the tech industry to say move fast, break things. The ability to aggregate, plan, and price is powerful — that takes care of the move fast part. But what makes m3ter’s applications in this space so special is the ability to bypass the break things downside. These features are special because they have the ability to increase your organization’s agility without sacrificing its accuracy — to test, then trust, then verify.
In her final blog post of the series, "Usage-based Pricing Doesn't Have to Be That Scary," Kristina highlights the benefits of integrating m3ter data into CRM for sales and marketing teams. It unlocks the PLG flywheel, driving growth through actionable insights and data-driven decision-making.
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