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+---
+name: saas-pricing-strategy
+description: Advises on SaaS pricing strategy using Daniel Priestley's oversubscription principles and Patrick Campbell's value-based framework. Use when defining pricing tiers, selecting value metrics, positioning against competitors, or creating pricing page copy for any SaaS product.
+---
+
+# SaaS Pricing Strategy
+
+Apply proven pricing frameworks from Daniel Priestley (demand generation) and Patrick Campbell (value-based pricing) to optimize SaaS pricing strategy.
+
+## When to Use This Skill
+
+- Defining or revising pricing tiers
+- Selecting value metrics (per-seat, usage-based, flat-rate, hybrid)
+- Competitive positioning and market analysis
+- Writing pricing page copy
+- Planning pricing experiments or A/B tests
+- Evaluating pricing model changes
+
+## Core Pricing Philosophy
+
+### Daniel Priestley's Oversubscription Principle
+
+#### Demand > Supply = Pricing Power
+
+DO NOT compete on price. Compete on demand generation.
+
+Key tenets:
+
+- Transparent capacity constraints create urgency
+- Waiting lists signal value and scarcity
+- Price reflects perceived value, not just costs
+- Market positioning matters more than feature comparison
+
+### Patrick Campbell's Value-Based Framework
+
+#### Price on value delivered, not cost incurred
+
+Key principles:
+
+1. **Value metric alignment**: What you charge for should match what customers value
+2. **Buyer persona intimacy**: Different segments have different willingness to pay
+3. **Continuous iteration**: Pricing is ongoing optimization, not one-time decision
+4. **3-tier sweet spot**: Fewer tiers = analysis paralysis, more tiers = choice overload
+
+## Value Metric Selection
+
+### Common Value Metrics
+
+**Per-Seat (Per-User)**
+
+- Best for: Collaboration tools, team software, platforms where value scales with team size
+- Pros: Predictable, simple, aligns with organizational growth
+- Cons: Can discourage adding users, ceiling effect for small teams
+
+**Usage-Based (Consumption)**
+
+- Best for: Infrastructure, APIs, data processing, services with variable usage
+- Pros: Fair pricing ("pay for what you use"), no ceiling on revenue
+- Cons: Unpredictable billing, complex to explain, requires usage tracking
+
+**Flat-Rate (All-You-Can-Eat)**
+
+- Best for: Simple products, low variance in usage, commoditized markets
+- Pros: Simplest to communicate, no metering overhead
+- Cons: Leaves money on table with power users, doesn't scale with value
+
+**Feature-Based (Good-Better-Best)**
+
+- Best for: Products with clear feature differentiation, tiered capabilities
+- Pros: Upgrade path is clear, captures different willingness to pay
+- Cons: Feature bloat temptation, can feel arbitrary
+
+**Hybrid (Combination)**
+
+- Best for: Complex products where multiple dimensions drive value
+- Pros: Captures more value, serves diverse segments
+- Cons: More complex to communicate and implement
+
+### Decision Framework for Value Metric
+
+Ask these questions:
+
+1. What metric correlates most strongly with customer value received?
+2. What's simple enough for customers to predict their costs?
+3. What aligns incentives (not penalizing desired behavior)?
+4. What grows naturally as customer success grows?
+5. What can you reliably measure and bill for?
+
+## Tiered Pricing Structure
+
+### Optimal Tier Count
+
+**3-4 tiers is ideal**
+
+- 2 tiers: Not enough choice, hard to capture variance
+- 3-4 tiers: Sweet spot for conversion
+- 5+ tiers: Analysis paralysis, decision fatigue
+
+### Tier Differentiation Strategies
+
+**Capacity Limits** (quantity-based)
+
+- Users, seats, projects, API calls, storage, transactions
+- Example: "Up to 5 users" vs "Up to 25 users"
+
+**Feature Access** (capability-based)
+
+- Advanced features, integrations, customization, priority support
+- Example: "Basic reports" vs "Custom dashboards + API access"
+
+**Service Level** (support-based)
+
+- Response time, dedicated support, onboarding, account management
+- Example: "Email support" vs "24/7 phone + dedicated CSM"
+
+**Usage Rights** (commercial terms)
+
+- Commercial use, white-labeling, resale rights, SLA guarantees
+- Example: "Personal use" vs "Commercial use + SLA"
+
+### Pricing Tier Psychology
+
+**Anchor with highest price**: Show Enterprise tier first or prominently to make mid-tier seem reasonable
+
+**Highlight recommended tier**: Use "Most Popular" or "Best Value" badge on target tier (usually middle)
+
+**Price gaps should increase**: $30 → $60 → $120 feels better than $30 → $50 → $70
+
+**Round numbers for simplicity**: $99/mo feels gimmicky for B2B; use $100/mo
+
+## Pricing Page Best Practices
+
+### Page Structure
+
+1. **Lead with value, not features**
+   - Wrong: "Unlimited clients, 5GB storage, custom fields"
+   - Right: "Save 10 hours per week on reporting"
+
+2. **Show annual savings option**
+   - Offer 2 months free for annual billing (17% discount)
+   - Improves cash flow and reduces churn
+
+3. **Transparent tier comparison**
+   - Feature comparison table with clear differentiators
+   - Use checkmarks, not excessive text
+   - Highlight recommended tier
+
+4. **Social proof by tier**
+   - Include customer counts, testimonials, use case examples per tier
+   - "Perfect for teams of 5-10" or "Used by 500+ companies like yours"
+
+5. **Remove friction**
+   - Free trial (14-30 days)
+   - No credit card required for trial (increases signups)
+   - Easy upgrade/downgrade path
+   - Money-back guarantee if appropriate
+
+### Copy Framework
+
+**Headline**: Focus on outcome transformation
+
+- Good: "Close deals faster with intelligent CRM"
+- Bad: "Affordable CRM software"
+
+**Subhead**: Address primary objection
+
+- "Simple enough to start today. Powerful enough to scale with you."
+
+**CTA Language**:
+
+- Entry tier: "Start Free Trial"
+- Mid tier: "Start Free Trial" or "Get Started"
+- Top tier: "Start Free Trial" or "Schedule Demo"
+- Enterprise: "Contact Sales" or "Let's Talk"
+
+### Priestley-Aligned Demand Tactics
+
+**Capacity Signaling**:
+
+- "We're currently onboarding X new customers per month"
+- "Join X+ companies already using [Product]"
+- "Limited spots available for [special program]"
+
+**Demand Indicators**:
+
+- Show number of customers/users
+- Display recent signups (with permission)
+- Highlight waitlist count or assessment completions
+
+## Competitive Positioning
+
+### Market Research Checklist
+
+Before setting prices, research:
+
+1. **Direct competitors**: What do they charge? How do they tier?
+2. **Adjacent solutions**: What alternatives exist? (spreadsheets, consultants, etc.)
+3. **Customer budget**: What's typical spend for this category?
+4. **Switching costs**: How hard is it to leave current solution?
+5. **Perceived value gap**: How much better are you, quantifiably?
+
+### Positioning Strategies
+
+**Price leadership** (lowest price)
+
+- Only if cost advantage is sustainable
+- Race to bottom risk
+- Attracts price-sensitive, high-churn customers
+
+**Value leadership** (best value)
+
+- Sweet spot for most SaaS
+- Middle-market pricing with superior product/service
+- "We're not the cheapest, but we're worth it"
+
+**Premium positioning** (highest price)
+
+- Requires defensible differentiation
+- Attracts best customers, lower churn
+- "You get what you pay for"
+
+## Pricing Experiments & Iteration
+
+### What to Test
+
+1. **Tier names**: Functional vs. aspirational (Starter vs. Essential)
+2. **Anchor pricing**: Show Enterprise price to make Professional seem reasonable
+3. **Feature bundling**: Which features drive upgrades?
+4. **Annual vs. monthly default**: Does showing annual first increase LTV?
+5. **Trial length**: 14 days vs. 30 days conversion rates
+6. **CTA copy**: "Start Free Trial" vs. "Get Started Free"
+
+### Metrics to Track
+
+- **Conversion rate by tier**: Which tier converts best from trial?
+- **Time to upgrade**: How long before customers outgrow their tier?
+- **Churn by tier**: Do certain tiers retain better?
+- **Revenue per customer by tier**: LTV analysis
+- **Failed payment recovery rate**: Billing issue resolution
+- **Price sensitivity**: At what price point do signups drop?
+
+### Iteration Cadence
+
+- Review pricing metrics: Monthly
+- Minor adjustments (copy, positioning): Quarterly
+- Major structural changes (tiers, value metric): Annually
+- Always communicate changes in advance and grandfather existing customers when appropriate
+
+## Common Pitfalls to Avoid
+
+❌ **Competing on price alone**: Race to bottom, attracts worst customers
+
+✓ **Compete on demand and positioning**: Create scarcity, demonstrate value
+
+❌ **Too many tiers**: Analysis paralysis kills conversions
+
+✓ **3-4 tiers maximum**: Clear upgrade path, easy decision
+
+❌ **Grandfathering forever**: Prevents necessary price increases
+
+✓ **Communicate value, migrate gradually**: Give notice, explain benefits
+
+❌ **Feature-based differentiation only**: Customers don't buy features
+
+✓ **Outcome-based positioning**: "Save X hours/week" or "Increase revenue by Y%"
+
+❌ **Hiding pricing**: "Contact us" for all tiers reduces trust
+
+✓ **Transparent pricing**: Builds trust, qualifies leads naturally
+
+❌ **Set and forget**: Pricing is not a one-time decision
+
+✓ **Continuous optimization**: Treat pricing like product development
+
+## Decision Framework
+
+When evaluating pricing changes, ask:
+
+1. **Does this align with customer value perception?** (Campbell principle)
+2. **Does this create healthy demand/supply tension?** (Priestley principle)
+3. **Is it simple to understand and predict?** (Complexity kills conversion)
+4. **Does it scale with customer success?** (Value metric alignment)
+5. **Can we test it without disrupting existing customers?** (Iteration safety)
+
+If yes to all five, proceed with experiment. If no to any, revisit approach.
+
+## Workflow
+
+When asked to help with pricing:
+
+1. **Understand the context**
+   - What does the product do?
+   - Who are the customers?
+   - What competitors exist and how do they price?
+   - What constraints exist (market, budget, positioning)?
+
+2. **Apply the frameworks**
+   - Recommend value metric using decision framework
+   - Suggest tier structure (3-4 tiers)
+   - Position against competition using Priestley's demand principles
+   - Apply Campbell's value-based approach
+
+3. **Deliverable options**
+   - Pricing strategy document
+   - Pricing page copy
+   - Competitive analysis
+   - A/B test plan
+   - Pricing tier structure with rationale
+
+4. **Next steps**
+   - Set up tracking and metrics
+   - Plan communication strategy
+   - Schedule quarterly pricing review