How Do You Price a SaaS Product?

I have been thinking a lot about pricing for my new product feather.so.

Ways of Pricing

The way I see it, there are many ways to price a SaaS product.
  1. My costs + some profit percentage
  1. Competitor-based pricing
  1. Value-based pricing
It’s the general consensus that the pricing should be based on the value that the user gets.
 
But here’s the problem. My SaaS product is a blogging platform. How would you quantify the value that the user is getting? It depends on so many factors like what the user is using the blog for. Something that is valuable to one user may not be valuable to another user. So, I am not sure how I can price based on the value the user is getting.
 
Another thing that I constantly hear when it comes to pricing is, price based on the target customer you are looking for, and also based on your personal goals of what you want to earn. I don’t know who my target customer is yet. I don’t have much data on who would want to use a product like feather.
 
I can just say that feather is a blogging platform for businesses who are using Notion for their content management because I know businesses are willing to pay more. But is this the right way to go about it? Are there even that many businesses that use Notion? Let’s assume there are a good number of businesses that use Notion in their everyday life for managing various things. Would they want to use Notion even for their blog? Why would they want to switch their existing blog to something brand new like feather?

Pricing Tiers

Let’s talk about pricing tiers. Again, I have seen people do this in so many different ways. Most of them have one metric that varies between different tiers. For example, a no-code website builder has the number of sites as a metric that varies between different tiers.

Personas

The other way of doing tiers is based on the different user personas. For example, let’s talk blogging.
  1. A person who wants a blog, just to share the content with his friends and relatives. They don’t care about anything else.
  1. A hobby blogger who just writes because it is their hobby and they don’t care if the blog is read by others or not.
  1. A blogger who wants to blog because of some personal gain, like building an audience, making money through affiliates, or other things.
  1. A blogger who is using the blog as a way to get more leads to their product(s).
  1. A business that wants a blog to share their updates and also as a way to communicate and educate their users.
 
Let’s call these as:
  1. Personal Blogger
  1. Hobby Blogger
  1. Influencer
  1. Solopreneur (Indie Maker)
  1. Business

Features

Each of these has different needs and wants.

SEO & Analytics

Personal and Hobby bloggers don’t care about SEO or analytics. So, even if I build these features, they wouldn’t be useful for these types of bloggers.

Newsletters and Memberships

This will be most useful to Influencer type bloggers and Solopreneurs. I don’t think businesses would need a native newsletter feature, as they might already be using some other email marketing software. So, if I want to mainly target businesses, do I even want to have these features?

Sitemap and RSS Feed

Again, this would only help those who want to distribute their blog content. Some of the users that I talked to (Personal and Hobby bloggers) do not care about these at all.

Search, Tags, and Authors

Again, these are good to have features that can be useful if you have a lot of blog posts but would be useless if you just have a very few posts.

Custom Domain

I guess everyone would want their blog to be on their own domain if they have a domain.

Automatic vs Manual Updates

I think businesses would want more control over when they want to update their articles, whereas others do not need or want such control.

API Access, Webhooks, and Automations

Again these are only useful for businesses, not others.

Pricing

So, if I were to go with this route of tiering based on the user personas. Here is what I would end up with.
💡
Hobby Blogger
  • Unlimited Sites and Custom Domains ✅
  • Unlimited Articles ✅
  • Unlimited Static Pages ✅
  • SEO ☑️
💡
Solo Blogger
  • Unlimited Sites and Custom Domains ✅
  • Unlimited Articles ✅
  • Unlimited Static Pages ✅
  • SEO ✅
  • Analytics ✅
  • Newsletters ✅
  • Memberships ✅
  • Sitemap ✅
  • RSS Feed ✅
💡
Business
  • Unlimited Sites and Custom Domains ✅
  • Unlimited Articles ✅
  • Unlimited Static Pages ✅
  • SEO ✅
  • Analytics ✅
  • Newsletters ☑️
  • Memberships ☑️
  • Sitemap ✅
  • RSS Feed ✅
  • Search, Tags and Authors ✅
  • Control over Updates ✅
  • API Access ✅
  • Team members ✅
  • Webhooks ✅
  • Automations ✅
After doing this differentiation, I feel like I am not 100% sure about the features that the businesses would want. These are not set in stone, but I think I found a good way to think about pricing.
 
Now, comes the limits. The user should get an obvious and immediate value increase when they shift from one tier to another tier.
 
Here are some of the things I can use as limits:
  1. Number of blogs / Number of custom domains
  1. Number of page views.
  1. Number of articles/pages
 
I have seen every other notion website builder that is out there using the number of custom domains or the number of sites as a metric to determine the various tiers. Even I was using that for MDX.one.
 
But I feel like that is not such a good metric, especially for a blog. I want users to produce more and more content and use the platform more and more. If I put the limit on the number of sites or the number of posts, then I am actively hindering that process.
 
Pageviews on the other hand directly correlate with the value the users are getting. The more page views the user’s content gets, it can be roughly assumed that the more value they are getting out of it.
 
So, I will put limits on the number of page views rather than the number of sites.
 
So, my final pricing plans might look something like this.
💡
Hobby Blogger
  • 10k pageviews
  • Unlimited Sites and Custom Domains ✅
  • Unlimited Articles ✅
  • Unlimited Static Pages ✅
  • SEO ☑️
💡
Solo Blogger
  • 100k pageviews
  • Unlimited Sites and Custom Domains ✅
  • Unlimited Articles ✅
  • Unlimited Static Pages ✅
  • SEO ✅
  • Analytics ✅
  • Newsletters ✅
  • Memberships ✅
  • Sitemap ✅
  • RSS Feed ✅
💡
Business
  • 1M pageviews
  • Unlimited Sites and Custom Domains ✅
  • Unlimited Articles ✅
  • Unlimited Static Pages ✅
  • SEO ✅
  • Analytics ✅
  • Newsletters ☑️
  • Memberships ☑️
  • Sitemap ✅
  • RSS Feed ✅
  • Search, Tags, and Authors ✅
  • Control over Updates ✅
  • API Access ✅
  • Team members ✅
  • Webhooks ✅
  • Automations ✅
The limits are high enough in each tier that the user wouldn’t worry about their page views being low, and if they do cross over the limits in their respective tiers, then it is cause for a celebration rather than worrying.
 
Now, I need to put a price tag on each of these tiers. From personal conversations with the users, a hobby blogger wouldn’t pay more than $10/month because of what they get out of it. But I personally don’t want to charge that low, so should I even have a Hobby Blogger tier? I don’t think I do. But let’s keep it just because I don’t yet have the data of who uses Feather more 🪶
 
So, if I were to put a price tag on these tiers, here is how it would be.
  1. Hobby Blogger ($9/month)
  1. Solo Blogger ($29/month)
  1. Business ($99/month)
 
 

My Newsletter

I am an Indie Maker and a Software Developer. I write about my journey of bootstrapping my SaaS products.

No spam. Unsubscribe at any time.