How can we figure out what customers are willing to pay?
Pricing often feels like an overwhelmingly giant topic, and makes many product people cringe.
Most teams I’ve worked with would rather ignore it for as long as they can
But if we skip gathering data about the possible effects of pricing changes before launching them, we’re likely to make painful mistakes - live and in public.
(Scroll to the end if you just want the questions 👇)
Can we figure out customers’ willingness to pay, before launching new pricing?
The most reliable way is testing in the market. You show real pricing changes to real page visitors, and track their actual behavior.
But what if your team isn’t ready to test in the market yet?
Sometimes, the risk just feels too high. Many teams I’ve worked with have the same initial response: “We can’t do that, it’s too risky.”
Although it’s less reliable…there is another option.
You can use interviews to gain insights about the range of prices to use, and the value they’re connected to.
But you have to ask the right questions.
Tips for getting trustworthy insight into your customer’s feelings about pricing
Don’t ask customers or prospects what they will or would do. They can’t predict their behavior
It’s slightly better to ask what someone has done in the past, but you’re still unlikely to predict future willingness to pay by relying only on past actions (give example, like Torres’s and jeans)
Figure out of the customer/prospect pays for a solution to their problem today and how much they pay
With landing page tests, limit the variables as much as possible to keep things more controllable (ex: test one pricing change to one product tier, in one market)
Aim to develop a narrower and narrower range of price points rather than trying to find the one perfect price
Ideally, test and evaluate pricing every quarter (don’t assume you can find the perfect price and be done with pricing forever. Test regularly to look for new opportunities)
Use my 45 thoroughly tested questions to start interviewing customers about pricing now
How can you be sure you’re asking the right questions in customer interviews about pricing?
The easiest way to run your first pricing interviews is to cherry-pick from a list of questions that I’ve already tried and tested on many startup clients’ projects.
They’re based on my experiments and the trials and errors of many other experts, too. They work. And you can use them immediately.
Plus, you can filter the questions to make sure you use the right ones for your audience: for B2B vs. B2C, for existing users or churned users…
Get access to the question bank for pricing interview questions FREE (plus learn how top startups have tested pricing in my newsletter) 👇