Impact Pricing Navigating Pricing Systems and Value-Based Selling in SaaS with Mac Kremer
Mac Kremer leads the pricing strategy practice at K1 Investment Management. He is experienced in B2B SaaS investing and value creation work.
In this episode, Mac shares strategies for growing SaaS businesses through price increases, upsells, cross-sells, and increased usage. It discusses the complexities of implementing pricing systems and emphasizes the importance of flexibility and understanding your pricing model. Additionally, it highlights the need to educate sales teams on value-based selling to reduce discounting and improve sales effectiveness.
Why you have to check out today’s podcast:
- Discover valuable strategies for growing SaaS businesses, including ways to expand, manage and track revenue streams effectively.
- Understand the complexities of implementing pricing systems in various-sized companies and find out solutions from simple tools to more sophisticated systems.
- Learn practical tips on communicating value to customers, helping sales teams to sell more effectively reducing the reliance on discounts.
"Sit down with whoever's responsible for pricing, decide to set up a committee and a cadence and just start talking about it more and more."
- Mac Kremer
Topics Covered:
01:35 - How Mac found himself in pricing
02:42 - Describing his role at a private equity firm as both an advisor and consultant
03:38 - Discussing the importance of customer conversations in understanding value propositions
05:47 - Explaining that value can also include benefits beyond profit
07:28 - Similarities and differences between B2B and B2C purchasing decisions
08:49 - Using ROI calculators and the ability of sales reps to contextualize ROI within the business's specific goals
09:56 - How ownership of pricing in a company depends on its stage of development
14:01 - Importance of forecasting and budgeting for pricing activities
16:00 - Understanding the sources of revenue growth highlighting the four ways to grow a customer: Win, Keep, Grow
19:49 - What to focus on when it comes to net revenue retention
21:35 - Variety of pricing systems used and how it depends on the complexity of pricing models used
23:55 - The complexities of implementing and managing pricing systems as companies grow
25:57 - Helping salespeople understand and communicate value
29:06 - Mac's best pricing advice
Key Takeaways:
"Customer conversations are so critical to understanding the value proposition of your solution, and where you kind of see your customer's perceiving value before you even start to talk about price." - Mac Kremer
"The best place to start when you're having customer conversations is, you can go in and you can kind of engineer the true value calculator, the EVC, the economic value to the customer. But I think it's also just understanding their perception of the value that they're receiving. Because I think value comes in a lot of different forms, even outside of just profit." - Mac Kremer
"A lot depends on the complexity of your pricing model when you go to think about what system we should be using?" - Mac Kremer
People/Resources Mentioned:
- Maxio: https://www.maxio.com
- Chargebee: https://www.chargebee.com
- Gainsight: https://www.gainsight.com
- NetSuite: https://www.netsuite.com/portal/home.shtmlSalesforce:https://www.salesforce.com
- Tableau: https://www.tableau.com
Connect with Mac Kremer:
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LinkedIn: https://www.linkedin.com/in/mac-kremer/
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: mark@impactpricing.com