Secrets to Successful Software Pricing - Next Future Today Episode 12

This interview between Dan Keldsen and Luke Hohmann discusses the importance of pricing and profit streams in software businesses, based on Luke's latest book "Software Profit Streams" a spiritual successor to the long legacy of "canvas" style books first started by Business Model Generation.Key Points🕰️ Time-based cadence is one of the triggers to change pricing.🏢 Internal triggers like adding new features can also necessitate pricing changes.🌍 External triggers such as regulatory changes, competitive forces, or hardware changes can impact pricing decisions.💰 Customer benefit analysis is the foundation for effective pricing strategies.🎯 Ilities (Reliability, Maintainability, Curability, Scalability) can be recast into current or future economic terms to inform pricing and licensing decisions.🤝 Intangible benefits of working with a company, such as being more flexible and willing to listen, should be considered in customer benefit analysis.📈 Pricing decisions should be revisited at least once a year, but more frequently in fast-growing products.📚 The book "Software Profit Streams" provides guidance on pricing and packaging decisions in a remarkably easy to understand, beautiful on the eyes, but quickly allows you to go VERY deep into software pricing.🧑‍🤝‍🧑 Collaborative decision-making is essential for pricing strategies.🧠 Simulations can be useful in building mental models, but relying too much on them can be risky due to unknown external triggers.