New 2020 Cascade Pricing (and why Pricing is so Hard!)
by Tom Wright, on Jan 29, 2020 4:04:41 PM
Today I want to share two things with you:
- Our shiny new Cascade pricing packages for 2020, our all-in-one strategy software. The great news is that we've made a huge step towards our company vision of 'Strategy for Everyone' by introducing a new $9 per month product called Starter. We also have a new Teams product which is crammed with features for small-medium sized teams who want to get s**t done!
- The story of how we came up with our new pricing, and more specifically, why pricing strategy is one of the hardest things to master in business. We've also got some tips if you're struggling with your own pricing demons too!
So to get things started, let me introduce you to our 3 new Cascade pricing plans:
Here's a bit more detail behind each of the new plans...
Ready to take strategic planning seriously, but not quite ready to go all-in on a software solution for execution?
Our Starter edition includes all of our incredible Plan features and costs just $9 per month for your first user. Starter is perfect if you're looking for:
- A solid but flexible strategic planning template to help you start planning
- A way to get out of Excel and into a modern strategic planning solution
- A workspace for collaborating with your team on strategic planning
- An easy way to create exports of your strategic plan to share with others
Of course, we called this edition 'Starter' for a reason - the idea is that once you feel comfortable with the state of your plan, you can start thinking about upgrading to one of our other editions that include powerful execution and reporting tools. That said, if all you need is a quick, easy and fun way to digitize your strategy, Starter might be the perfect solution :)
Have a strategy already and need a modern software tool to help with the transition to execution?
Teams is the ultimate self-service software tool for strategy execution. We created the Teams edition to make strategy execution software affordable no matter where in its lifecycle your business is. It includes enough users to get you started, and almost all of our crazy-powerful software features spanning Plan, Manage and Track.
Teams is perfect for you if:
- You have a decent strategic plan and want to move to execution
- You'll be working with your team of between 3-15 people to get it done
- You don't need any help with the 'soft' side of strategy - formulation, governance, team engagement, etc
Ready to implement the gold-standard of strategy execution solutions?
Cascade Enterprise is our 'piece de resistance' and is the solution being used by high-growth companies right through to members of the Fortune 500. It includes all of our incredible software features, with fine-grained control over things like permissions, visibility and Enterprise-grade security.
Enterprise doesn't just include software - it also gives you access to our range of strategy services. These services are designed to help you formulate the perfect strategic plan, put in place a powerful strategy governance program and engage your entire organization around strategy and execution.
Enterprise is a great fit if you're:
- A medium to large team focused on execution
- Implementing a strategy transformation program
- Need help with formulation, governance or engagement
- Looking for unlimited software licenses
- Need a custom solution to meet your strategy needs
If you're considering Enterprise, you'll definitely want to speak to one of our team to go over your needs and come up with your customized solution and price.
We're pretty happy with where we've landed on our new pricing plans. But it wasn't easy, and if you'd like to learn more about the process and how you can tweak your own pricing strategy, read on...
Why is Pricing Strategy so Hard?
Sometimes I wish we could just make our entire product suite 100% free. Not because I'm feeling any kind of left-over Christmas related generosity, though: the reason that I would love to make it all free, is because I hate pricing. More specifically, pricing strategy is one of the hardest and most imprecise elements of our business model.
To make matters worse, pricing strategy is arguably one of the most important and certainly most overlooked elements in building your business. According to data from priceintelligently.com - having an effective pricing strategy is typically 2x more impactful on profit than an effective retention strategy. And has 4x times more impact on profit than an effective acquisition strategy. Yet I'll be first to admit that I spend way more time talking about acquisition and retention as tools to impact growth than I do pricing.
Because of that reality we've spent the last couple of years in a pretty bad state of pricing limbo. Let me explain...
Here's a screenshot of how our pricing looked until very recently:
As you can see, we had only two pricing plans - Pro and Enterprise. Whilst we have hundreds of successful customers on both plans, the reality is that those customers have been successful despite our pricing, not because of it.
The Problems with our 'Pro' plan
The Pro plan started at $29 per month and gave customers access to a most of our software features, including the headline features from Plan, Manage and Track. But within that access, they were restricted in lots of different ways, such as only having the ability to create 3 strategy dashboards.
On the surface, this sounds like a decent pricing strategy - but there are some fundamental problems that we saw customers experiencing:
1. The connection between pricing and customer engagement
Getting customers to use all the features you have isn't easy. Cascade software is designed to walk you through the stages of strategy execution - Plan, Manage & Track. Once you have a great plan, you move into using the Manage features to get things done. Once you start managing things, you start using our Track features to get strategic insights. The problem with Pro, was that people would walk themselves through the stages, and eventually start using one of our Track features (such as dashboards) - then, just as they were getting into the swing of the feature, they would be hit with the "Sorry, you can only add 3 dashboards on the Pro plan" message.
Booooo. A huge turn-off for customers who were finally doing what we wanted - i.e. engaging with the product!
Our Solution: On the Teams plan, there are basically no limits to your usage of individual features, so you can add as many dashboards as you like!
2. Not everyone is looking for all-in-one strategy software
Another part of our original pricing strategy for Pro, was to give users a taster of all of the features spanning Plan, Manage & Track. The issue was that in many cases, people were finding the 'Plan' stage hard enough to get through, and the tantalizing sight of our Manage and Track features sitting there (and being paid for) was actually quite off-putting for people whose goal was simply to create a strategic plan that they were proud of.
Customers felt like they were paying $29 per month but only using more like $10 per month of the features they were paying for.
Our Solution: Starter includes only our Plan features, and better still costs only $9 per month - killer value for those looking for a market-leading strategic planning tool.
3. $29 a month wasn't enough to give some customers the experience they needed
This might be controversial, but... we realized that charging $29 a month for customers who wanted to make the transition from strategic planning to strategic execution wasn't enough money. The reason is that from experience, we know how hard it can be to galvanize your organization into execution-mode. We also know that we can help with that, through providing on-boarding services, advice and a little bit of hand holding throughout setup.
The issue was that at $29, we didn't have the margins to put one of our excellent Customer Success Managers onto our Pro accounts, which means they didn't receive any personalized onboarding or advice about how to get their strategy setup just right.
Our Solution: Our new Teams plan includes a seamless onboarding experience, led by one of our strategy specialists. Whilst ultimately intended to be a self-service product, this Teams Onboarding experience has already proven to be a huge boon for clients that have experienced it in our testing phase.
The Problems with our old 'Enterprise' plan
Whilst our Pro plan started at $29 per month, our Enterprise plan was significantly more expensive starting in most cases at around $500 per month, depending on the number of user licenses purchased.
Overall, our Enterprise plan was actually significantly better than our Pro plan in terms of retention and customer satisfaction. But it too had some issues:
1. Getting invoiced for every extra user was a massive pain
Under our old model, we would charge customers for every single additional user they added to their account. That's a new invoice, maybe a new purchase order, maybe a new approval process that needs to be followed. Worse still, we were not only subjecting our customers to this pain - we were doing it to them right after they did something really awesome, which was grow their usage of Cascade!
That just felt wrong. We want as many people as possible to have access to incredible strategy software (remember, our vision is 'Strategy for Everyone') - so we had to find a different way to price growth in these at-scale accounts.
Our Solution: The new Enterprise plan includes unlimited user licenses for the period of your subscription term. We'll work with you to determine a fair price up front and then any growth that happens after that will be included in your subscription. We have a few 'fair play' rules around this approach as you can imagine, but we're confident this will remove one of the biggest pains with per-user-SaaS pricing models.
2. The jump from $29 to $500+ was huge
Most SaaS pricing models get quite a bit more expensive as you head into the 'Enterprise' pricing territory. That's normal and frankly commensurate with the amount of investment and personalization that Enterprise customers typically require and receive.
But we still felt that under our old model, the sticker-shock from $29 to $500+ per month was a bit too sharp (even though you were getting many more included users on our Enterprise plan).
Our Solution: The new Teams plan halves that sticker-shock and still provides much of the value that people need on their way to our Enterprise software tier.
3. We weren't including one of our biggest value-adds - knowledge
At Cascade, we will always be a software company, and we will always be a product company. However the reality is that strategy execution is hard - like, really hard!
We noticed that with some customers, we were able to spend a little more time - to give advice on things like:
- How to structure their strategic plans for success
- How to create a set of reports and dashboards geared towards execution
- How to launch an effective strategy governance process
- How to engage people throughout the organization with strategy
Those customers were getting exponentially more value from their launch of Cascade than those with whom we didn't invest that time.
Our Solution: Our new Enterprise plan comes with access to a brand new suite of strategy services to help you solve some of the most common organizational problems around strategy execution.
Conclusion - What Questions Should you ask Yourself About your Current Pricing Strategy?
Whist our experiences are very much our own, I'm confident that there are several themes I can draw out of those experiences which may also affect you.
So I would love for you to challenge your own pricing strategy, by asking the following questions of it:
- Is your pricing acting as a barrier for user adoption of key features or services?
- Are you trying to force 'too much product' down the throat of your customers rather than listening to what they actually want?
- Is your product under-priced to the point where you're compromising the level of service you give beyond what you consider acceptable?
- Are there any annoying hurdles (such as multiple invoices) that you can remove from your pricing process?
- Do you have a natural and smooth upwards gradient in your pricing options without massive sticker-shocks?
- Are you really selling (and therefore including) all of your best assets in your pricing packages?
Hopefully you like our new pricing, and this mini-expose of how we got there has been useful. Let me know what you think about our new packages!