Bundle pricing for SaaS: How to create value for your customers

In today's SaaS market, offering flexible pricing options is key for attracting and retaining customers. Bundle pricing is a powerful strategy that allows you to do just that. It's a strategy where you package your SaaS product in a way that meets different needs and budgets.

In this article, we'll explore the ins and outs of bundle pricing for SaaS. We’ll provide you with a complete guide to creating bundles that make your solution appealing to a wider audience.

You'll also learn:

• The key benefits of this pricing for SaaS businesses
• Types of bundle pricing models and how to choose the right one
• A step-by-step process for creating effective pricing strategies
• Real-world examples of successful bundle pricing in action

We'll start by explaining what bundle pricing actually means in the SaaS.

What is bundle pricing?

Bundle pricing is a strategy where companies group several of their products together and sell them as a single package. Usually, they sell it at a discounted price. Instead of paying for each item individually, customers get access to a collection of offerings for a lower cost.

Why do SaaS companies find this approach so appealing?

It boils down to creating value for both the business and the customer. By bundling products or services, SaaS companies can encourage users to adopt a wider range of their offerings.

Such a strategy increases the average deal size while also deepening customer relationships. After all, customers who use more of your products are more likely to stick around.

Think of it this way: A customer might be interested in your core product, but they’re hesitant to try out additional features. Bundling those features with the main offering at a reduced price makes the decision much easier.

Moreover, bundle pricing can simplify the buying process. Instead of presenting customers with a long list of products and prices, you offer a curated selection of packages.It’s easier for customers to find the right solution and reduces decision fatigue.

Benefits of bundle pricing for SaaS businesses

Bundle pricing offers lots of advantages for SaaS companies looking to grow their business. Here are some key benefits:

• Boost revenue and average deal size: Bundling encourages customers to purchase more at once. Bundle purchases often lead to larger deals and increased overall revenue.
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• Increased customer lifetime value: When customers find value in multiple products within a bundle, they're more likely to stay subscribed for longer periods.
  
  The result is higher customer lifetime value and a more predictable revenue stream.
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• Improved customer acquisition: Attractive bundles can be a powerful tool for drawing in new customers. The perceived value of a bundle can make your offering more enticing compared to buying individual products.
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• Reduced churn: Customers who use multiple products within your ecosystem are less likely to churn. Why? They become more invested in your platform. Overall, bundles create a "stickier" product experience.
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• Simplified product marketing: Instead of marketing each product, you can focus on promoting a few curated bundles. This strategy can save time and resources while presenting a clearer value proposition to customers.
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• Happier customers: Customers love feeling like they're getting a good deal. Bundle pricing allows you to offer discounts while still maintaining healthy profit margins.
  
  The result is happier customers who are more likely to recommend your services.

Key types of SaaS bundle pricing models

When it comes to bundle pricing for SaaS, it’s important to know that different models cater to different needs and business goals. Let's explore some of the most common and effective bundle pricing models in SaaS:

Feature-based bundles

Feature-based bundles group different features of your software into tiered packages. Customers can choose a plan that best aligns with their needs and budget. Typically, higher-priced tiers include more advanced features.

Example

Imagine a project management software offering three bundles:

• Basic: This bundle includes task management, basic collaboration tools, and limited storage.
• Premium: This one adds features like Gantt charts, time tracking, and increased storage.
• Enterprise: This bundle unlocks advanced features like custom reporting, workflow automation, and priority support.

This model allows customers to start with a basic plan and upgrade as their needs evolve.

User-based bundles

These bundles are priced according to the number of users who will access the software. This model is common for collaboration tools and platforms where multiple team members need access.

Example

A video conferencing platform may offer bundle pricing based on the number of participants allowed per meeting. A small team might need a bundle for 10 users, while a large organization might require a bundle for 100 users.

Usage-based bundles

With usage-based bundles, the pricing is tied to the client’s usage of the solution. Factors like the number of API calls, data storage used, or the number of transactions processed can determine the cost.

Example

A cloud storage provider can offer bundle pricing based on the amount of storage space used. As the user’s storage needs grow, they can upgrade to a bundle with more capacity. This approach can be appealing to users who want to avoid paying for unused resources.

Solution-oriented bundles

Solution-oriented bundles combine different features that address a specific customer pain point. This approach focuses on providing a complete solution rather than just individual products.

Example

A marketing automation platform might offer a bundle that includes email marketing, social media scheduling, and landing page creation tools. This approach provides an all-encompassing solution for potential clients.

How to create effective bundle pricing for SaaS

Crafting a bundle pricing strategy requires a delicate balance. You need to understand your customers, your products, and your market. Follow these steps to create SaaS bundles that truly resonate with your audience:

Step 1: Identify core customer needs and pain points

Go beyond basic demographics and dive into the motivations of your customers. Conduct surveys and interviews to gather firsthand perspectives on their needs and pain points. Supplement this qualitative data with quantitative insights from your product usage data.

Analyze which features are most popular. Then, spot any bottlenecks in the user experience and uncover any unmet needs that your bundles could address. Finally, synthesize your findings into detailed customer personas that represent your target segments.

Step 2: Segment your customer base strategically

Divide customers into distinct segments based on relevant criteria. Consider grouping customers by company size. You should always keep in mind that small businesses will have different needs and budgets compared to large enterprises.

If you cater to specific industries, tailor your bundles to address their unique needs and pain points.

Alternatively, segment your customers based on their desired outcomes. Offer bundles that help them achieve specific goals. The goals can include increasing productivity, boosting customer engagement, or simplifying workflows.

Remember: By aligning your bundles with customer segments, you increase their relevance and appeal.

Step 3: Price bundles to reflect customer value

When setting prices, focus on the perceived value of the bundle rather than simply calculating costs. How much value will the customer gain from the combined offering?

A successful bundle pricing strategy hinges on making customers feel like they're getting a great deal. Conduct thorough price sensitivity testing to find the sweet spot. By sweet spot, we mean the point where customers perceive high value at a price that meets your revenue goals.

Step 4: Offer clear options without overwhelming customers

Avoid swamping your customers by presenting a curated selection of bundles. Strive for clarity and conciseness in your bundle descriptions. Use straightforward language and highlight the key features and benefits in a comparison table.

Use visual cues like distinct colors or labels to help customers distinguish between bundle options. Make the selection process as intuitive as possible so customers can easily find the bundle that clicks with them.

Step 5: Test and refine bundles with real-time data

Launching your bundles is just the beginning. A/B testing is your ally in the refinement process. Test bundle configurations and descriptions to see what resonates best with your audience.

Track key metrics like conversion rates, churn rates, and customer lifetime value. Doing so will help you measure the effectiveness of each variation.

Actively solicit customer feedback through surveys, polls, or direct conversations. Ask them about their experience with the bundles, what they find valuable, and what could be improved. This qualitative feedback provides invaluable context and insights.

Use this combination of data and feedback to continuously iterate and improve your bundles going forward.

Real-world examples of effective bundle pricing in SaaS

Let's move from theory to practice and see how some leading SaaS companies are using bundle pricing. Here are three distinct real-world bundle pricing examples:

Customer service platforms: Zendesk's tiered plan approach

Zendesk is a popular customer service platform. It offers products designed to help businesses manage multi-channel customer interactions.

Instead of offering individual products à la carte, Zendesk offers tiered plans. Each tier bundles together a set of core products with increasing levels of functionality and support as the price increases.

For example, their "Suite Team" plan includes email, chat, voice, and social messaging channels, a help center, AI-powered bots, and pre-built analytics dashboards. The "Suite Growth" plan adds features like workflow automation, reporting, and a higher limit on bots.

Marketing automation tools: HubSpot's segmented bundles

HubSpot is a well-known marketing automation platform. It has a variety of bundles on offer, all tailored to different customer segments.

HubSpot's bundles cater to these different needs by offering separate "Hubs." There are hubs for marketing, sales, service, operations, and CMS. Within each Hub, they offer tiered plans with increasing levels of functionality.

Bundled options are also available, with names like "CRM Suite," which combines Sales Hub, Service Hub, Marketing Hub, and Operations Hub. They also offer "Starter," "Professional," and "Enterprise" versions of the CRM Suite.

Project management software: Monday.com's feature-based bundles

Monday.com, a project management tool, uses a feature-based bundle pricing model. They offer a range of plans with increasing levels of features and functionality. Their “Free” plan allows users to experience the basic functionalities of the platform.

As you move up to higher tiers like “Standard,” “Pro,” and “Enterprise,” you unlock more advanced features. These features include automation, integrations, and reporting capabilities. This structure lets companies start with a basic plan and upgrade as they see fit.

Try Orb’s flexible billing platform to manage your pricing

We've explored the ins and outs of bundle pricing in SaaS. Now, let's talk about how to bring those bundles to life. Managing pricing structures, especially as your SaaS business scales, can become cumbersome.

That's where Orbcomes in.

Orb is a done-for-you billing platform designed to simplify and automate your SaaS billing operations. Product leaders at companies like Perplexity and Vercel rely on Orb to create a scalable billing infrastructure.

Here's how Orb can help you implement and manage your pricing strategies:

• Easy bundle creation: Orb allows you to create and manage complex bundles, no matter how many features you offer. Define your bundles, set your pricing, and let Orb handle the rest.
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• Flexible pricing engine: Experiment with different pricing models. Think tiered pricing, usage-based pricing, and flat subscriptions. Orb's flexible engine lets you adapt your pricing strategy as your business scales.
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• Accurate usage tracking: Orb's metering infrastructure provides a single source of truth for usage data. We help you guarantee accurate billing for every customer, even with complex bundle structures.
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• Automated invoicing: Generate professional invoices that clearly reflect your bundle pricing. Orb automates the invoicing process, saving you time and reducing errors.
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• Integrations: Orb integrates with popular payment gateways like Stripe. That means we allow you to accept payments from customers worldwide and facilitate your revenue collection.
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• Real-time reporting: Gain key insights into your billing data with Orb's reporting tools. Track key metrics, find trends, and make data-driven decisions to optimize your bundle pricing strategy.

Ready to take control of your SaaS billing and unlock the full potential of your bundle pricing? Give Orb a try and experience the benefits firsthand. Check out our flexible pricing options for every stage of growth.