I tend to post on our blog about topics that are top of mind or in the news; most often they are what I'm currently working on with clients. This often leads to a lack of "SaaS 101" information since I don't go back and re-post old stories.
Mostly, this blog represents the evolution of our expertise with SaaS & Web App marketing and Business Architecture. As we work with - and learn from - our 100s of clients all over the world, our company evolves its thinking, and that is reflected on this blog through my posts. This is also true with how I communicate to our mailing list members.
To me this just makes sense - the business of SaaS & Web Apps - Business Architecture, Revenue Modeling, Pricing, Freemium, Distribution, etc. - are all evolving (sometimes daily!) requiring us to evolve and this blog reflects that. My take is this - if you are a consultant to SaaS and Web App businesses (or any businesses probably) and are not constantly evolving, you are of no use! Evolve or die.
Sometimes, however, I am so taken aback by a question I get asked that it requires me to stop and take a look at how we're positioning Sixteen Ventures. Just when you think it all makes sense you get a question like the one below. The wild thing is that this is from a member of the mailing list where we send out a couple of messages per week - at least - and where serious assumptions about the make-up of the audience, our reach, mindshare, etc. are made. Those assumptions appear to be a bit off-base.
Anyway, check this out:
Thank you for continuing to keep me on your email list, despite my not having signed up yet for any of your sessions. I do expect to sign up with you in the near future, but I have one question I'm hoping you can answer for me first. My interest is in SaaS pricing for B2B. How much of what you do is pricing for B2C (as opposed to B2B)? Or do you find that lessons learned, what does (or does not) work, etc. - is mostly common across B2B and B2C?
Again, yikes... I thought Sixteen Ventures was pretty well established as a sell-side (meaning we work with the vendors) B2B SaaS consultancy. After my initial shock, I sent him an email back and thought you might benefit from this, too:
In my experience B2B and B2C pricing are very different animals. People do weird things on their own that they will not do in their business. While they will sit at their desk and play Farmville on Facebook while listening to music from Pandora, when the boss emails them to find a better XYZ business solution, they will start doing due diligence, looking at overall value, prices, ROI, SLAs, security, etc. So even though the social / game mechanics / Freemium stuff is huge in B2C, those same people that it works on for the latest social game craze still look at things differently in the B2B world. Even if those worlds collide on their work computer. (I think this is where the confusion happens)
That said, things are changing and many of the elements of B2C marketing (and remember, pricing is marketing) are starting to show up and be effective in B2B, but not across the board; at least not yet. It is this last point that seems to trip up even the savviest of B2B marketers. Just because some things like social proof, viral elements, etc. works to drive the astronomical growth of Box.net - a narrowband horizontal B2B app - does not mean it will work with your Medical Office Management or Employee Scheduling solution. Everything in B2B depends on the market (segment) and the vendors position within that market.
So to clarify, at Sixteen Ventures we work solely with B2B SaaS, Web App, and Mobile vendors. Our Pricing expertise is within Value Pricing (vs. cost-based, consumption/usage-based) around Recurring Revenue and App Store Distribution in the context of SaaS, Web & Mobile Apps. That is to say that if you sell truck tires, you probably wouldn't get Sixteen Ventures to help you, but if you have a B2B SaaS or Web App and need to figure out your pricing strategy, we're the ones to turn to.
I thought it was an interesting question and thought if by chance you were wondering about this, that you would benefit from this Q&A.
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