Enterprise Sales with Pete Koomen | Startup School

Pricing Basics

Pricing a product is a complex task without a straightforward formula, as Pete Koomen explains. He suggests asking strategic questions to understand the customer's needs and budget before setting a price. This approach allows for flexibility and experimentation, as seen in Optimizely's early days when they adjusted prices based on customer feedback.

The advice that I give to startups is to think of each pricing conversation you have as an opportunity to run an experiment in which you test a price point and then learn from your prospect's reaction to it.

--- Pete Koomen

Koomen emphasizes that initial pricing should be seen as a learning opportunity rather than a fixed strategy 1.

   

High Pricing

Setting high prices can be risky but also rewarding, as Pete Koomen shares from his experience. He notes that higher prices can indicate the seriousness of a customer's need for a product, as demonstrated by Optimizely's ability to sell even when initial quotes were significantly higher than what customers were willing to pay.

One of the most surprising things I learned was that when a customer really wants your product, it's hard to scare them away by quoting a price that's too high.

--- Pete Koomen

Koomen advises startups to be bold with pricing and to use these interactions to gauge customer interest and willingness to invest 1.