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Marketing your startup takes many forms. The classical marketing approach revolves around the 4 P’s: Product, Price, Promotion and Place. For this question and answer, we will tackle the Pricing aspects of marketing and how different pricing models work and how you might approach pricing your products and services.

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The only question I see is, "How should I price my products or services?" -- surely that's way too broad (see answers.onstartups.com/faq where it says, "Please avoid... wide open questions. Don't write a sentence and expect to get a page back. A question like "How can I sell more of my product" deserves an encyclopedia article. Try to scale back to something more specific.") – Jeremy Parsons Aug 8 '11 at 10:03
@Jeremy. Thanks for the comment. This question is part of our canonical question and answer series where we post what we feel are good questions and answers on a topic. It's meant to be a little broader than most. The intent is that users will read the canonical posts and then craft more specific questions for their needs. These are also community wiki so others can build and share what they feel are good questions and answers. – Jarie Bolander Aug 8 '11 at 12:37
Ah! All is now clear! Thanks :) – Jeremy Parsons Aug 9 '11 at 14:19

1 Answer

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Pricing is tricky. It’s not an exact science and is a big lever on your sales and profitability.

Getting into the mind of your customer takes skill, luck and a little bit of patience. Out of all the marking disciplines, pricing is the area where fierce debate rages on maximizing sales revenue while also making a profit.

It’s no surprise that most entrepreneurs have pricing questions. Below are a few questions and answers that give some great advice on pricing.

  • Subscription Pricing Starting Strategy: This is a classic problem — where to start pricing. Is it better to start high and go low or start low and go high. Lots of good links to articles as well.
  • Does Charging Less Make Your Product Look Inferior: An example of how price may not be the reason you are not making sales. Also discusses some pricing strategies to try out.
  • Freemium Pricing Model: A question by our on Dharmesh. Has some examples of big companies that use the Freemium model — a free product with a paid for upgrade.
  • How About “Pay Whatever You Want”: This is intriguing. Kinda like a sliding scale model where people basically pay what they feel your product is worth. This is risky but interesting. The best nugget by [Dennis Palmer](Dennis Palmer) “It gave people the freedom to be generous.”
  • The Left Digit Effect: This is an age old question — what sells mores $9.99 or $10.00. The question uses the example $49.95 vs $50.00 but the effects are the same. The answers have some great examples of actual data on how it worked out.
  • Different Pricing For Different Countries: An interesting question given the global nature of the Internet and what people can afford to spend in different countries.
  • Free Trial vs Freemium: Great thread about a free level versus a free trial.

Additional Tags:

You can also take a look at the subscriptions and payments tags for additional thoughts.

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