The Breakdown

3 Pricing Tactics To Boost SaaS Revenue

Just a few tweaks to your pricing strategy can boost your revenue by 5% or more.

Plus it compounds over the long term. A 5% boost now means almost 80% more revenue after 12 months!

Let’s break it down:

1) Pause subscriptions

There are hundreds of reasons a customer will churn.

You can’t save them all. But some you can.

By letting customers pause their subscription for 1 → 3 months, you’ll be able to do 3 things:

• Label them as ‘likely to churn’

• Engage them in an email sequence to remind them of what they’ll be missing

• But most importantly - get in contact and find out where they need help

And if after all that, they still cancel their subscription, then at least you’ve gained some valuable information.

But if they decide to come back - then you’ve just recovered revenue that would otherwise have been lost!

Saving just 1 in 20 customers like this means growing 5% faster each month.

Plus - this feature is built natively into all the top platforms:

• Pause subscriptions with Stripe

• Pause subscriptions with LemonSqueezy

• Pause subscriptions with Paddle

2) One-time discounts

This one is simple as pie.

Every visitor to your payment page has 2 choices: pay or leave.

Most of those who left were never going to convert anyway.

But some were, they just didn’t feel comfortable with the price.

Every time one of these customers leaves, it’s a missed opportunity.

A persuasive discount at the right moment could be just what they need to convert.

That means showing a popup on ‘exit intent’ (i.e. when the customer is just about to leave).

Here’s a CodePen on how to do it.

Position your offer with at least a 30% discount and use compelling copy to increase conversions:

• “Just for you…”

• “Leaving already?”

Want an example? See how ZenDesk does this to get more demos.

3) Incentivise yearly upgrades

Yearly plans are the secret sauce to boosting revenue.

They work in 3 (main) ways:

• They reduce churn

• They attract higher-value customers

• They give you more time to wow a customer

Here’s a detailed guide on all the benefits of yearly subscriptions.

Every time you have the chance to upgrade someone to a yearly plan you should take it.

But the #1 place to incentivise this is for new customers who are about to sign up for a monthly plan.

Why?

They already know they need your product and are ready to pay you.

So by upselling a discount on a yearly plan, you can take more money off the table.

The trick here is deciding how much discount to offer so you’re not selling yourself short.

Let’s take the following example:

• A SaaS with two plans: $9/month or $99/year.

• Average retention: 6 months

The average lifetime value (LTV) of a monthly customer is $54 (6 months x $9 a month).

Let’s assume 1 in 20 takes up your offer of a yearly plan at say $60/year.

After 6 months you’ll be left with an extra $6 ($60 - $54) per customer (on average).

That’s 11% more revenue!