Dimitar Serafimov| Mon Jun 17 2019 CET| Industry insights
Behind any successful subscription service stands a well-designed pricing scheme. In fact, pricing schemes are one of the most critical elements of any SVoD business strategy, regardless of your niche or sector.
Pricing has a direct impact on your business’s success-centric KPIs. Even the smallest of price alterations can serve to improve your profits, significantly.
A recent HBR study discovered that a mere 1% improvement in price can boost operating profit by as much as 11% – a real driver of business growth and performance.
A testament to the power of an effective, well-developed pricing scheme.
It’s clear that a solid pricing strategy is integral to the growth of your SVoD business. To help you on your path to success, here are five practical price scheme-boosting tips:
As apps, by their nature, are more exposed in the marketplace, they need more considerable attention and research. When settling on app price, there are some interesting studies to explore – this chart from Liftoff included:
At a glance, the chart shows us what we’d consider as obvious: apps in the middle price range show the highest conversion rate.
But digging deeper, it’s explicit that the Goldilocks principle governing product success also rings true for mobile app pricing.
The ‘just right’ price is the sought after middle ground between the two extremes – a range that doesn’t force users to exist outside of their typical comfort zones.
Pricing can affect customer churn significantly – but, adding an annual pricing scheme to your offerings could well tackle this issue.
In fact, studies suggest that around one out of five SaaS businesses offer both monthly and annual pricing plans. Monthly payments might be the staple of your business, but, annual subscriptions could secure you more upfront custom, boosting your cash flow, and reduce churn in the process.
Pricing counts. And now that you have all of the tips and tools you need to refine your strategy, it’s time to get started – best of luck.
Learn more about you can grow by tackling OTT churn: