How can you align product marketing and product planning teams on pricing and packaging?

Another important aspect to take into consideration is to be sure to speak the “customer’s language when creating price models, if that applies to your industry. We’ve had the same product with different price models with the man goal of making it simpler and easier for customers to understand. For instance: - we would sell ‘price per truck’ when talking to long haul logistics companies, - ‘price per active user’ talking to ride-hailing customers, - or ‘price per delivery’ when selling to food delivery accounts. Using the same unit customers use to measure themselves helps understanding the model and makes it easier to relate to the value. Of course, it all depends on how disruptive of a price strategy is needed for your product.

Strategic competitor analysis is essential for crafting impactful messaging that capitalizes on competitors' weaknesses and developing competitive pricing strategies. Seamless collaboration between Product Marketing and Product Planning is paramount in achieving this synergy. For instance, by closely monitoring competitors' pricing models, such as a recent case where our rival launched a premium version of their product at a higher cost, we can strategically position our offering as a more cost-effective yet equally feature-rich solution, thereby appealing to price-conscious customers without compromising on quality.

A lot of product marketing teams start creating content, website pages, videos and other materials directly, and define the value proposition on the fly. Don’t do that. Before you create anything, start with a messaging library. In this library you define how the company talks about challenges, use cases, features, short term benefits and long term values. It can also contain positioning on partnerships, and competitors. This library will help you align all your content and enablement materials and to be consistent. It will also help you align stakeholders on your value proposition. Finally, set it up in tools like Notion so teams can easily collaborate and review.

When product marketing and product planning teams work together to define the value proposition, they can align on the key features, benefits, and positioning of the product. This alignment ensures that the pricing strategy accurately reflects the value delivered by the product, and that the packaging options effectively communicate the value proposition to customers. Without a well-defined value proposition, there can be confusion in pricing and packaging decisions, leading to inconsistent messaging and missed opportunities to attract and retain customers.

Conducting a competitor analysis is vital for aligning marketing and product planning. This includes identifying competitors, analyzing their products, features, and pricing, and understanding their market positioning. Key components are market share analysis, SWOT analysis, and monitoring their marketing tactics. This insight helps identify market gaps and opportunities for differentiation. By comparing your product’s features and benefits with competitors, you can effectively position your product, ensuring your pricing strategy reflects its value and remains competitive for your target audience.

Understanding the value proposition needs a more comprehensive exploration of how these elements translate into a cohesive pricing and packaging strategy. While defining target markets, positioning, and messaging is crucial, a more detailed discussion on the practical application of value-based, cost-based, or competitive-based pricing and bundling strategies is essential. It's imperative to ensure the theoretical understanding seamlessly translates into a strategic pricing framework aligned with market dynamics and customer expectations.

Understanding the value proposition is pivotal in aligning marketing and planning. It's not just about identifying the problem solved and benefits offered; it's crucial to grasp how these translate into real-world customer value. This understanding informs the target market definition, product positioning, and messaging strategy. It's also essential for determining pricing strategy, be it value-based, cost-based, or competitive. Moreover, understanding the value proposition aids in effectively packaging and presenting product features and benefits, ensuring they resonate with the target audience and stand out in the competitive landscape.

A clearly defined and transparent product roadmap will help product and product marketing teams to align early. A vision on how the packaging structure can scale over time will also provide guidance, in combination with the expectations of customers, trends in the market and the category your product and brand is positioned in.

Something I’ve seen work well is kicking off with a project alignment brief (before the actual brief!). Once you are aligned on the key problems to solve, customer insights, and gather input from all the teams on this brief, you can move to the actual project brief. It may seem like an extra step but XFN alignment early on helps the rest of the process move efficiently.

Have deliberate check-ins between both teams from idea to launch to post-launch stage. This makes both teams to have - Context on the product and its value - Info on how the thinking around the product and its value to customers changes based on new info discovered along the way

Aligning product marketing and planning teams on pricing and packaging requires early and frequent involvement. Establish a cross-functional team for regular discussions to share insights, feedback, and data. Waiting until the product is ready to launch risks surprises and conflicts. Regular meetings help align goals, expectations, and assumptions, preventing delays. Moreover, it facilitates testing pricing hypotheses with customers and stakeholders, ensuring adjustments based on real-time feedback. Early collaboration is the key to avoiding last-minute adjustments and fostering a cohesive strategy.

Prior to making decisions regarding pricing or packaging, it is imperative for the Product Marketing and Product Planning teams to convene, either in person or virtually, ensuring comprehensive discussions and alignment of information so that all team members are on the same page.

I've witnessed the pitfalls of silencing information and making decisions without cross-team consultation—these misunderstandings, errors, and gaps in the process can cause projects extra delays and critical errors.

A comunicação eficaz é parte primordial no processo de alinhamento entre equipes. Seja direto, claro, objetivo e cordial. Com uma comunicação assertiva a chance de sucesso nos projetos desenvolvidos se torna muito maior.

Impact of new pricing - especially in high ACV enterprise sales motion, will take some time to monitor. One metric that will change early is sales pipeline stage conversion rates, average discount per deal, deal length and closed won/lost rate.

The universal language in an organization is data. Is there a way to test pricing and packaging before a launch? Build a framework for testing your pricing and packaging. Figure out how to tease future features, pricing, and plans to users and monitor opt-in rates closely AND make sure you involve product in designing these tests! The insights from your tests will help you build a business case of how to approach packaging and pricing that is backed by more than opinion. A word of warning, choose one thing to test at a time. Too many variable changes will lead you right back to where you started.

One thing I've found helpful is tracking user behavior within the product. Identifying - which features are most popular in a particular plan - any pattern in usage - if features in lower value plans used or if they can be repackaged with higher value plans ensure that pricing and packaging remain responsive to changes in the user behavior.

Assuming pricing is static can be detrimental. I found it helpful to adopt the pricing-based vital metrics monitoring approach with KPIs such as conversion rates, churn rate, revenue growth and ARPAC. This ongoing assessment highlights what's practical, areas needing improvement, and potential opportunities. It's a dynamic approach that enables agile responses to shifting customer needs, market dynamics, and competitive challenges.

It's important to prepare case studies and learn about what worked and what succeeded, and what didn't. Then it's important to communicate these lessons to the teams.

In my experience, 1. Set-up a cross function team between Product Marketing, Product, Sales and CS. 2. Create a customer list that represents your market and prepare for customer interviews 3. Set hypothesis’s on features, packaging and pricing with team for the research 4. Focus on willingness to pay and the difference between perceived value versus adoption 5. This will help you understand killers, fillers, leaders and add-ons, and the sweet spot for pricing 6. With pricing set, do a revenue impact analysis that will help forecasting 7. Create a roll-out plan and prepare for launch.

Understanding product-market-price-fit is a critical early step for a company - i.e. not just does your product solve a problem that people care about but are they willing to pay you to solve it for them. This needs to also tie into the "how" of your pricing, not just the amount. So focusing on the metric and the packaging is critical and directly interacts with the product and positioning side of the house. There are key product requirements and it directly impact how you communicate the value of your product. These two teams need to be in sync to make this work. Connecting the teams relevant metrics (often around acquisition, monetization, and retention) can be a good place to start as they wind up being great ways to evaluate pricing.

Alignment between product managers and marketers influences product roadmaps and go-to-market strategies. Teams need to continuously assess whether they are aligned on effort prioritization and customer friction aspects of their product development life-cycle. Continuously ask yourself the following questions to cross-check alignment. If your answers are ‘negative’ or ‘I don’t know’, then you need to restructure how you collaborate internally. Are we still aligned on areas of priority? What can alter the focus on priorities? How were areas of priority assessed and defined? How do areas of priority align with the corporate vision? Is the product easily reached by target customers?