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The FishmanAF Newsletter
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How To Land A Pricing Change
- The push for improved unit economics has led to pricing changes across various startup and public companies. This newsletter article covers various monetization models and how they map to different company types.
- The monetization models that exist are transactions, subscriptions (consumer), subscriptions (B2B), usage-based, and advertising.
- Case Study 1: Alienate Your Customers, Erode Trust, and Make The Entire Internet Angry At You - What We Did Wrong at Patreon. The article discusses a Patreon pricing change gone wrong in December 2017 and the mistakes made in the solution, discovery, and communication aspects. Six mistakes were made in total that can be bucketed into three themes - mistakes with the solution, discovery, and communication.
- Case Study 2: Win Customer Support and Build Trust – What We Did Right at Patreon. To address predictability, scale, and differentiated needs associated with its pricing structure, Patreon conducted both qualitative and quantitative pricing discovery. With months of discovery behind them, they introduced a three-tiered pricing approach and won creator support by providing legacy pricing and offering downgrade alternatives.
- Four core lessons on how to soften the blow for existing customers with pricing changes include: create more than you capture, notify creators under your organization, provide a “downgrade” alternative, and offer legacy pricing or “founding creator” pricing.
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