MicroConf Lesson 6: Charge More
This is part 6 of my Lessons Learned at MicroConf.
Increasing pricing was a very common theme at MicroConf 2013. Just about every speaker mentioned it at some time, but in particular Jason Cohen, Rob Walling, and Patrick McKenzie.
Start-ups often price their products based on what it costs to build, manage and host. While all of these factors are important, they are secondary to the actual value your product provides.
So how do you estimate value?
A great way estimate value is to consider both the time you save your customer by providing the product and the financial benefit your customers will gain from the it. If you can save your customers’ time and enable your customers’ to increase revenue you are in a great position to charge a substantial premium over what it costs you to actually build the software.
For your own products, you need to always keep this in mind. Yes, a skilled developer could hack together a one-off version of just about anything (or it could be outsourced more cheaply). However, this is not likely the best use of your customer’s time (or money). Really smart customers, the kind you want to do business with, value their time and will pay you handsomely if you can return some of it to them. And of course they will pay you even more if what you deliver is of great value.