How To Successfully Charge At Least Double For The Same Product
Think books. Paperback or hardcover — roughly we can look at them that way.
The latter is more expensive — and more durable most of the time. It makes sense why, more material is used and there’s some added value to that (i.e the book will probably last longer). Maybe besides durability, there’s also some preference factor — which we’ll get back to in a bit.
However, the content is exactly the same. If that book is going to inspire you to change the world, it’s going to do that whether it’s coming in the paperback or hardcover form.
And despite that, both are still being produced and sold. If we are to look at it objectively, paperbacks are more portable (as they’re lighter), cheaper and better for the environment. On the other hand, hardcovers are better if you (so they say!):
- are a collector
- want your bookshelf to look nicer
- want to pass on the book to your children, grandchildren etc
And that was just after a quick internet search on people’s opinions on these two. I wanted to know why one over the other. Here’s my take on it: much like a lot of things, it’s about the experience.
Even though 99% of the interaction (which is reading words on pieces of paper) is the same, it’s that thing in buyers’ minds that makes the difference. You feel the touch of that shiny/glossy wrap around the book, feel it heavier and maybe even more important. You know there’s some solidity to it, physically in the first place and eventually metaphorically.
Translation to SaaS business
What is it that we can get out of that in the context of SaaS businesses?
For one, people like options. People don’t go specifically for the most objective choice (and that’s nothing new, we’re rarely rational buyers) — but here might be the kick: maybe the way you “package” your SaaS matters.
Maybe the logo, the name of that feature or the way the feature is presented matters. Maybe you can get the extra financial gain because of the hardcover print, over the “simple” paperback alternative. I’ve heard that paying for the hardcover benefits the publisher, not necessarily the writer.
Not to say, they keep value better. Would that be translated to higher value retention when a SaaS company is purchased? I’d say so. More often than not, tech CEOs (and that’s predicated a lot on their background) tend to focus on the utilitarian layer of value and deem “packaging” as useless. Or maybe not useless but at least “it’s not important now”.
It’s the same kind of discussion about content and distribution. Some just write, don’t care about distribution and because it’s so good, somehow it spreads like a virus.
However, what if there was an amount of effort directed towards distribution in the first place? Wouldn’t that piece of writing reach the same milestones it did in a faster manner?
Here’s the takeaway: the way your product is wrapped together matters. And people pay sometimes double for the exact same content (and utilitarian value) consciously.
About Ch Daniel
I run Chagency_, an experiences design agency that specialises on helping tech CEOs reduce user churn. We’re building the bible of experiences.
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