Johnny Cheng is the Senior Director of Pricing and Packaging at ClickUp. He was the Senior Director of Pricing and Packaging at Coupa Software, and has years of experience in Product Marketing through various companies.
In this episode, Johnny shares his knowledge and experience on product marketing and product management as he educates us on the benefits of solution pricing, especially as to how a lens test helps on creating packages.
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Why you have to check out today’s podcast:
- Find out what crucial perspective companies miss when pricing sits in finance
- Learn about the benefits of having solution pricing, as well as to how you can sell value instead of features
- Discover a packaging system that incredibly works, both for the customers and the company
“Go do the lens test. Even if your packaging is already set, I would go back and do that exercise. I feel like if you do it across different teams, you’ll be very surprised at what you see.”
– Johnny Cheng
Topics Covered:
01:05 – How Johnny got into pricing
01:50 – Comparing the role of product management with product marketing
05:46 – Does pricing ever exist without packaging or are the two just so tightly connected?
08:33 – Johnny as a strong believer of having solution pricing
12:18 – Johnny vs. Mark on good, better, best
15:16 – The system Johnny uses to decide which features goes in which package
20:58 – Tips and tools that can help you sell value instead of features
26:56 – Salespeople discounting too much because they don’t sell the value of the product
28:47 – Johnny’s pricing advice
30:05 – Connect with Johnny
Key Takeaways:
“I’m seeing more and more in product marketing just exactly to your point. It’s more customer driven, it’s more go-to market driven, it’s more value driven. And so, if you sit in product management, every feature you release is the best feature ever, right? But product marketing really understands the value and how to apply to certain customers, what the use cases are, what the different profiles are and how you monetize that, and I feel like you kind of lose that lens sitting in the product management side.” – Johnny Cheng
“Once you have kind of that product marketing angle, that’s where the magic happens, right? Because that feature could be worth $1 to this one segment and $10 to this other segment. You would never know unless you actually go find out what their pain points are, find out what their needs are.” – Johnny Cheng
People / Resources Mentioned:
- ClickUp: https://clickup.com/
- Marketo: https://business.adobe.com/products/marketo/adobe-marketo.html
- Gainsight: https://www.gainsight.com/
- Coupa: https://www.coupa.com/
- Selling Value: https://selling-value.com/
- Zoom: https://zoom.us/
Connect with Johnny Cheng:
- LinkedIn: https://www.linkedin.com/in/jdcheng/
- Email: [email protected]
Connect with Mark Stiving:
- LinkedIn: https://www.linkedin.com/in/stiving/
- Email: [email protected]
Full Interview Transcript
(Note: This transcript was created with an AI transcription service. Please forgive any transcription or grammatical errors. We probably sounded better in real life.)
Mark Stiving
Welcome to Impact Pricing, the podcast where we discuss pricing, value, and the art-and-science relationship between them. I’m Mark Stiving and our guest today is Johnny Cheng. Here are three things you’d want to know about Johnny before we start. He is the Senior Director of Pricing and Packaging at ClickUp; he was the Senior Director of Pricing and Packaging at Coupa Software; and he came out of Product Marketing, which I find very interesting. Welcome, Johnny.
Johnny Cheng
Thanks for having me, Mark.
Mark Stiving
It’s going to be fun.
Okay, first question. How did you get into pricing?
Johnny Cheng
That is a good question. I actually wanted to go into core product marketing back at Marketo, and at the time, I was doing a lot of platform product marketing and there was a huge gap for pricing and packaging. And so, I have a math and analytics background so I kind of raised my hand and kind of filled that role, and I just loved it. I ended up finding my colleague, and I just have done it since for the past ten years.
Mark Stiving
What I find funny about that is that most of your titles are product marketing related, and until you get to the last two words where it says, ‘Hey, I do pricing and packaging,’ which is really explicit, how do you compare product management with pricing and packaging?
Johnny Cheng
Yeah, it’s really funny you mentioned that, because I think at a lot of companies, I’ve seen pricing sit under product marketing, product management, finance, operations, rev-ops, like all sorts of different places. I feel like each definitely has its pros and cons. Obviously, I’m a little bit biased because I come from product marketing, but I feel like there’s a lot of pros that come from being in product marketing branch when it comes to pricing, right? Like, you’re kind of plugged into all these go-to market initiatives. You’re plugged into sales. You also have a pulse on just customer sentiment, which I feel like you miss out on if you’re more on the product management side or on the finance side. And so there’s definitely a lot of pros to that, and so I definitely play on those strengths in my roles.
Mark Stiving
Yeah. I see everything you just said and I want to toss a theory out to you and I just want to hear you agree, disagree, pontificate. But it feels to me like pricing and packaging used to sit in product management, and that’s really because we used to have these big waterfall projects, or even in hardware, you would say it’s still there, because product management is out saying, ‘Here’s all the features we’re going to put in which packages, and here’s the value to the customer,’ and product marketing’s job is to communicate all that. And in today’s world of SaaS, it certainly feels like we’re tweaking the product constantly, we’re deciding which features go in which package, we’ve got this fantastic relationship with our customers. Product marketing has such a close relationship with our customers where product management is almost being relegated to a product owner role now.
Johnny Cheng
Yeah, I totally see that too. And I think if you talk like maybe ten years ago, I feel like pricing majority of time sat in product management, because it was very product led. And I feel like that’s kind of changed, especially in the past couple of years, and I’m seeing more and more in product marketing just exactly to your point. It’s more customer driven, it’s more go-to market driven, it’s more value driven. And so, if you sit in product management, every feature you release is the best feature ever, right? But product marketing really understands the value and how to apply to certain customers, what the use cases are, what the different profiles are and how you monetize that, and I feel like you kind of lose that lens sitting in the product management side. It’s not to say I don’t kind of go in hand in hand and partner with product managers; it’s not the case. They’re probably the closest team I work with. But you definitely are missing that customer side, like you were saying, for sure.
Mark Stiving
So what do you think the role of product management is today? And I don’t want to call them product owners because that’s a very different role, but it almost feels like product marketers are taking over the strategic decisions.
Johnny Cheng
I would say so. I would say it’s definitely much more of a partnership and much less of if you look years back, they were seen as kind of a supporting role. Like you said, they would just get the communication arm of product management. But I think it’s changed now that they’re much more strategic. They’re much more plugged in into even the product roadmaps. And so, if you look at product management, they obviously own the product, they obviously own what features are being released, what features are being developed. They’re kind of the caretakers of engineering and development. But I think product marketing now plays almost like at a 10,000ft level now, where it’s like, ‘what is the vision? Where are we taking this product in terms of these different industries? Which features and profiles should we start building for?’ And then product management almost like takes it down to the thousand feet level and then they start developing and then the features come to fruition.
Mark Stiving
Nice. I love your title, by the way. Director of Pricing and Packaging. I just think that’s such a cool title. And let me just ask the question instead of giving an opinion. Does pricing ever exist without packaging or are the two just so tightly connected?
Johnny Cheng
Yeah, that’s a good question. I would say there’s probably roles out there where those two are separated. In my world, they’re not. In my world, they’re completely intertwined. I mean, I don’t make price book changes and pricing changes without taking packaging integration and vice versa. But I know there’s definitely roles out there where basically, your hands are tied when it comes to packaging, because either engineering constraints, either the product is developed a certain way and you don’t have that creativity to actually go package, then your only lever is pricing, and I’ve seen that at certain roles. But at least for me, there’s two different levers that you can impact, and there’s different resources that you can use to pull those levers. A good case in point is there could be certain packaging changes that I could make that would actually drive a pricing impact. If I, all of a sudden, start moving around features into a higher tier of plans, I might not need to actually change price because I might see an organic shift to the next plan. And so, I love having those two levers to pull instead of just having one.
Mark Stiving
Okay. And I actually think you pull a third lever too, without explicitly stating it, and that third lever is market segments. Because when you can decide which features go in which packages, you get to target specific market segments with specific packages.
Johnny Cheng
Yeah, 100%. And I think this goes back to the earlier point about being under product marketing. That’s another huge probe, right? It’s the fact that you understand what these market segments are, whether it’s industries, whether it’s company size, and we can go target them with certain packages. Back at Marketo, we did a complete pricing revamp where we ended up coming up with five different use cases, and we targeted certain segments just based on those use cases, and the lift on ASP was huge because the customers felt like we were building packages for them, and they could relate to that, and we were able to message it a certain way. And so, that actually helps sales actually increase the price, because there’s a lot of perceived value there.
Mark Stiving
Yeah, I love what you just said. I often teach that we want to pick market segments around what are the common problems that our customers have, and you could just replace the word problems with use cases. And so that says, ‘this is what we just did.’ What I didn’t hear you say, but I’m sure that it’s implied there – different use cases have different value. And so, if I can solve the really high value use case or high value problems, I get to charge more money for it.
Johnny Cheng
Totally.
Mark Stiving
And then I can charge less money for the low value ones but still win those customers.
Johnny Cheng
Yeah, exactly. You’re spot on about that. The other thing that’s actually really interesting is I’m a strong believer in having solution pricing, to be able to manipulate your packages based off of those use cases. And to your point, you almost can reconstruct it into prescriptive, let’s call it bundles, for customers that have higher perceived value because they’re getting things that solve for their needs. And so, I find that super effective because as a company matures and they go out of the good, better, best, you can start getting very creative with solution packaging. So, swap out about that.
Mark Stiving
Yeah, and it’s easier to do when you’re actually providing solutions to customers, and I say that because I’m not sure what all the companies that you’ve worked for do, but oftentimes, we sell a platform, which means ‘you can take this and do anything you want with it.’ Just for kicks, let’s talk about Zoom. Zoom is a platform, right? I can use it for medical, I could use it for classes, I could use it for you and I having a conversation and recording a podcast. There’s a thousand different uses that we could use Zoom for, and yet they’ve got to find a way to price Zoom. I’m just going to stop there and let you pontificate on what that means in terms of packages versus solutions.
Johnny Cheng
Yeah, that’s a very interesting example. I think one of the things…let’s continue with the Zoom example. I think one of the things that you kind of look into is, like as the market matures, and if I was Zoom, or maybe, let’s say I was a secondary player and Zoom was up there, I think one of the big strategic moves you can do do is start going towards solution packaging. And so, I’ll give you some examples. Let’s say that you’re specifically using video chat for medical, for health care. You can start building integrations to things, to medical systems. You can start building in features that are HIPAA compliant, things like that. And I think that’s one of the things where you can start influencing product management in the roadmap to start building these things, if you want to go target these verticals, if you want to go target these solutions. And then you can basically start packaging that way, which is actually really interesting, because you could have like one platform, but that platform can do a bunch of different things. But then if you start adding on these features, if you start adding on these integrations, all of a sudden, it becomes very focused and you basically can solve for certain use cases and needs that that segment really, really values, right?
Mark Stiving
Yeah, and what I love about that is when you’re selling just the platform, it’s selling the feature. All I can do is tell you the feature. And it’s really hard to say what’s the value of this feature when there’s thousands of use cases.
Johnny Cheng
Exactly.
Mark Stiving
But as soon as I say, here’s the solution to this problem, for this market segment, for this use case, then I can start talking about value and how valuable this is to you.
Johnny Cheng
Yeah, and I think that’s actually the biggest thing that I think companies miss when pricing sits in finance. And so, you have pricing that sits in rev-ops and finance, and they don’t have that lens. Basically, engineering comes up with this feature, and they’re like, ‘Go sell this feature. I’m just going to price it competitively.’ But then once you have kind of that product marketing angle, that’s where the magic happens, right? Because that feature could be worth $1 to this one segment and $10 to this other segment. You would never know unless you actually go find out what their pain points are, find out what their needs are. And so, yeah, definitely.
Mark Stiving
Okay. So, I love disagreeing with my guests at times, Johnny, so don’t take offense at this, but you said something that kind of struck me the wrong way, and I want to go back to it.
Johnny Cheng
Yup.
Mark Stiving
I am a huge fan of good, better, best. So, you can go ahead and abuse me for a second, and then I’ll tell you why I’m a huge fan of good, better, best.
Johnny Cheng
I always get into this fight with pricing professionals about this. I think it has its place; I think good, better, best definitely has its place. I think there are some cons to it, which a lot of pricing professionals kind of look over. I think the biggest con is that you don’t get to monetize a whole entire spectrum. They might not fit into the good, better, best. They could fit into like a better version two or a better version three. And so, that’s why I’m a big fan of solution pricing, because you almost can inject that kind of value in what you’re saying to about different segments, different industries, different use cases. You kind of miss that with the good, better, best because it’s not always fitting into those buckets.
I think where it’s really good, though, especially if your company is not as mature and you’re just coming up in the market, I think it’s a great way for a customer to kind of self identify and choose and kind of have an upgrade path into higher dollars. I think it does a really good job there. But I’ve seen companies where they have multiple product lines, multiple use cases. They’re like way late in their maturity, and they’re still using a good, better, best. And I feel like you’re just not a good fit, but you’re leaving so much money on the table when there could be just, like, hundreds of different ways you can branch out.
Mark Stiving
Yup. Okay, so now I’m going to defend my good, better, best, if I may.
Johnny Cheng
Go ahead.
Mark Stiving
And the truth is, I think you and I think the exact same thing; we just say it differently. And that is I’m a huge fan of good, better, best inside a market segment. So, once you find me a use case that you say, ‘hey, we’re going out, we’ll go back to Zoom, and we’ll go to Zoom Medical,’ now, I know I can do a good, better, best package for Zoom Medical, and it helps people make a decision. It makes it easier for them to make a decision. It gives them the upgrade path if they get into the good package, and then we can upgrade them to better invest. But I think it’s really hard for Zoom as a platform to say, ‘hey, we’ve got this good, better, best package because we don’t know what the solutions are.’ We can’t really solve it that way. So, my guess is that we probably agree on that, but I think what you thought when you said “I don’t like good, better, best” is ‘I can’t use good, better, best as a company or a platform. I’ve only got three offers.’
Johnny Cheng
Exactly.
Mark Stiving
Because that just makes no sense. It absolutely makes no sense.
Johnny Cheng
Exactly.
Mark Stiving
Unless you’re an Apple iPhone, and then it seems to work.
Johnny Cheng
Yeah, exactly. If you’re giving them no choice and you know you can you already have a premium, I guess it’s fine.
Mark Stiving
Right.
Johnny Cheng
But most companies don’t have that kind of luxury.
Mark Stiving
Yup. Okay, so now, what’s your technique? I want to learn from you. Let’s see, you’ve got a hundred different product features, you have a single market segment, and you’re going to create a good, better, best package inside the market segment. How do you decide which feature goes in which package?
Johnny Cheng
That’s a good one. I have this system that I’ve been using for the past couple of years. I call it a lens test. And so, what I do is I look at each feature or module or app, whatever you want to call it, I look at each component basically based off of three different lenses. I look at it based on perceived value to the target market. And if it’s just one market, makes it very simple – how does that market perceive this feature? Whether it’s low, medium, or high. And then I look at it based on differentiation. How differentiated is this feature? Is it extremely differentiated? Is it very high or is it very low where everyone in the industry has that feature and it’s just table stakes? And then the third lens that I think a lot of marketing analysis don’t take into consideration is sophistication. How mature is this feature? If you have a feature that’s like very high in sophistication, very late in maturity, it’s not obviously going to be a feature that customer is going to pick up, and you have to keep that in mind.
And so basically, I run this and it becomes like this huge table and this huge matrix, and I do it for all the different features and capabilities, and did it all in my past companies as well. And you basically can start picking out patterns, because then there’s going to be features that are going to be very high in value, very differentiated, and let’s say low sophistication. That’s going to be the money maker. That’s the thing that you want to advertise. That’s going to think it’s going to be like 42 font size right on your pricing page. That’s the thing that you need to call out. And then you’re going to have things that are, let’s just say high value, high differentiation, and high sophistication. That’s the stuff that you want to leave for add ons and for your best packages. Provide an upgrade path so that when a customer starts using your product and really starts loving it and really get into it and they become much more mature, they can now see the value of that one feature and that will drive them towards upgrade.
And then the thing that product management hates the most is you’re going to have features that are like low value, low differentiation, like high sophistication; like they just shouldn’t have built that feature. And most of the time you find out those are the features that like one or two customers requested and they just built it and they just want to monetize it. And those are the ones that you probably don’t want to highlight, you don’t want to call out on your pricing page.
But basically, I go through these patterns throughout all of the different things, and then I basically see if there’s a way that you can bucket it as well. And then that’s basically my baseline for forming what let’s say good, better, best, or a solution packaging would look like.
Mark Stiving
So, when you say the word ‘sophistication’, I think what you’re saying is complexity to the user.
Johnny Cheng
Correct.
Mark Stiving
Okay, good.
Johnny Cheng
Well, sorry, part of it, yes. Part of it is the complexity; I would say that’s half of it. And then the other half is they just won’t use it or see the value of it early on.
Mark Stiving
Yup.
Johnny Cheng
Integration is a very good example, or analytics; like you’re not going to just throw up analytics or advanced analytics through a lot of applications. You definitely pick up value as you go, right?
Mark Stiving
Yup, got it. Let me tell you how I tend to think of it. One of several ways I tend to think of it, and it’s actually really, I think it’s highly correlated with the way you think about it. And that is, can we monitor usage of our features and our customers? And then if we can do that, we can go back and say, look, these are the features that every customer uses, so let’s call this an MVP, right? This is what you just got to have.
Johnny Cheng
Yup.
Mark Stiving
And that goes in our good. And then we’ve got features that some people use or a lot of people like. And so, we might put those in our better. And then we’ve got those few features that the people who value us a ton, they’re the only ones who use it, and those are the ones we put in the best categories.
Johnny Cheng
Yeah.
Mark Stiving
And I think that’s really highly correlated with your description.
Johnny Cheng
Yeah, it’s very correlated. After I do the lens test, I obviously compare it with historical data, usage data, like what you were saying, and then also competitive. And what’s interesting that you said is I feel like the lens test, where it fills the gap is you can have different teams take the lens test. If I have product management take the lens test, they’re going to mark ‘everything is high value’, ‘everything is…’ right? And so, if you give it to product marketing, it’s a different story. If you give it to sales, it’s a different story. So, I feel like having these different lenses, you sometimes miss out because there could be features out there where not a lot of customers use, but for a certain segment, it could be table stakes. And just based off of usage, you wouldn’t see that until later on. We actually start to actually dissect how it’s being used by food. And so, taking a lens test almost like shortcuts that a little bit.
Mark Stiving
Yeah. It’ll be fun for us to sit down and compare techniques because I use a very similar technique to figure out what my market segments are. And so, if you were to either say usage or just use your lens test, on a scale of one to five, how much does this customer value this feature? Then you could get to, ‘oh, these customers all value this feature and nobody else does. What’s different about these customers?’
Johnny Cheng
Yeah, that’s true. Exactly.
Mark Stiving
And so we start to get there as well.
Johnny Cheng
Yep.
Mark Stiving
Nice. Okay. My third book was titled Selling Value. You actually mentioned to me that you care about selling value in the B2B space. Tell me how you help salespeople sell value instead of features.
Johnny Cheng
Yeah, I think that’s where the art comes into pricing packaging. I talk about the art and science side of it, and the science side of it is also what we just talked about; it’s a lot of usage data, it’s a lot of things that aren’t very subjective. But I feel like there’s another side of it, and I think a lot of really good, seasoned salespeople now to take advantage of this, but I think a lot of really young, just, like, out of college sales people just feature selling becomes a crutch. They see like, ‘oh, this feature is great. Good. I’m just going to sell this feature,’ right? But then it’s all about selling the value. And I think a lot of, like I said, really good salespeople understand this. And I always try to build a pricing model for those sellers that know how to sell the value.
And so, a couple of tools that I’ll provide them in terms of pricing packaging. One is I’m a big fan of black box pricing; so not showing the list price, not showing the discount, having a bundled approach so that sales knows basically where to sell the value. Because if you’re talking about these large B2B accounts, the customer doesn’t really care what the list price is, honestly. At the end of the day, they might say that they do, but a discount in the list price is all made up. It is, right? Because if you’re selling someone $100,000 solution, and to them, they’re getting 20x ROI out of it, what does it matter what the list price was, right? And so you can end up getting really creative with that.
The other thing that I really like doing is I like injecting a little bit of flexibility into it, where I like certain features and apps and modules to have different levers. And I think a lot of companies, they get very scared and the only usage metric would be just users. I see this a lot, but it’s just like, ‘I was going to go with users because I feel like users is like the industry standard, everyone’s users.’ But I love getting creative because if you can map the lever to what the customer sees value, like, maybe it’s contacts, maybe it’s storage, maybe it’s the number of customers, whatever it is, it could even be a company size, right? And if you can match that to the value that the customer is going to get, then salesperson can actually take that and manipulate it. Like, do I put more dollars into this application and less dollars into this? Because the metric aligns better with the customer is asking for.
And so, at the end of the day, it gets a little bit complex, but I’m also a big believer in having sales tools like a pricing calculator, like the CPQ tool, things like that, to reduce the complexity and have a lot of guided selling. That’s basically my approach.
Mark Stiving
Yeah, I love the attitude, but I’m really curious, if I allow salespeople to go out and I think you said they can choose their own pricing metric, so we’re going to charge one customer by the user, we’re going to charge another customer by…
Johnny Cheng
That’s really dangerous. I’m not saying that. Definitely not saying that.
Mark Stiving
Okay, good.
Johnny Cheng
That’s super dangerous to say. No, sorry. I’m saying having multiple levers. And so a product can have not just based on users, but maybe based on users and contacts, and having sales understand which lever is more important, right? I’ll give you a good example. Let’s say we use that Marketo, where it’s just user in context. There are certain customers where the number of marketing users won’t grow because they’re getting much more efficient at marketing campaigns. They’re getting much more efficient at casting a wider net. But what does go up? Contacts does, right? And it’s also vice versa, too, where there are certain industries where the contacts actually don’t grow by that much. Let’s say financial institutions. But a number of users, marketing users, that create bigger, larger fancier campaigns, users go up. And so, by having multiple levers, you can have sales choose, assign which one that they should assign more value to.
And so, as the price goes up based on both of those levers, then you can say, like, I’m going to assign more dollars towards users so that capture more expansion, or more dollars towards tech so that I can grow as the company gets the wider net.
Mark Stiving
Okay, so you’ve defined two different pricing metrics that you allow sales people to choose between, essentially, to say, ‘hey, where do we want to go?’ and the idea is the salesperson is looking out for the company, our company, not the customer, right? I mean, ideally, they’re doing both, but they’re looking out for our best interest as opposed to the company. That’s actually very interesting. I would 100% agree that we should give them the sales tools to be able to talk about ROI based on the lever that our customer cares about.
Johnny Cheng
Yes.
Mark Stiving
So if they care about users, let’s talk about the value per user. If they care about contacts, let’s talk about the value per contact.
Johnny Cheng
Yes, exactly.
Mark Stiving
And that makes a huge difference. But I don’t know that I’ve ever seen a company allow pricing people to choose the metric. That’s pretty fascinating. I’m going to have to step back and think about it.
Johnny Cheng
Yeah, it’s worked really well, especially if you think of more consultative sales. Some of my past companies, like Marketo, Gainsight, Coupa, they’re very large deals, and it’s a lot of consultative sale. So you have to be very prescriptive. And so certain levers, like I said, lands really well with certain customers and not well with other customers.
Mark Stiving
Yeah, but that’s not my problem with this, believe it or not. First off, I’m going to make a statement. Salespeople are all going to hate me now. Salespeople discount too much because they don’t sell the value of the product. Sorry, salespeople. Now, if you assume that’s true, and then you say to me as a salesperson, ‘hey, you’re not allowed to discount,’ then what I choose is instead of discounting, I sell the wrong pricing metric to my customer because it’s the equivalent of a discount and I’m helping out my customer.
Johnny Cheng
Yeah, it’s so funny that you mentioned that. These types of very flexible models only work if there’s some sort of pricing tool, whether it’s price calculator, CPQ. There has to be some sort of guidance. You have to give them a guided selling process. If the customer is XYZ, go with this lever. This is how you should price it. Here’s your discount band. These are the products you should add. Very, very guided, right? If you don’t have that, then you’re right. Then it’s like I could pick the wrong lever, maybe on purpose, maybe, I don’t know. It’s a salesman thing.
The other thing that I will say is a lot of junior salespeople, a lot of people, they don’t understand value selling, they really struggle with this model. So this model definitely is not for everyone, because like I said, when you don’t have that feature crutch, and when you can’t go in there and do a consultative sale, it becomes very hard for these junior sales people to really understand what the customer values. And they might pick the wrong lever, they might assign dollars to the wrong lever. And it could be a deal where we never get any upside because the rep completely messed up the deal. And so, it’s very much like a high risk, high reward, which is why it has to be a lot of handholding. Without that, this model completely fails.
Mark Stiving
Yeah. And I assume that you have to compensate salespeople on expansion revenue?
Johnny Cheng
Correct.
Mark Stiving
So that they’re motivated to choose the right metric.
Johnny Cheng
Exactly, yes. That is table stakes for this. Like, they have to be compensated on an entire lifecycle of the customer because they’re trying to do land expands where they understand it’s a huge upside because I’m selling this one lever.
Mark Stiving
Yes. Perfect. Johnny, this has just been fascinating. I’ve loved this conversation, but we’re going to have to wrap it up, so last question for you. What’s one piece of pricing advice you would give our listeners that you think could have a big impact on their business?
Johnny Cheng
That is a good one. I would actually encourage everyone to actually go do the lens test. Even if your packaging is already set, I would go back and do that exercise. And I feel like if you do it across different teams, you’ll be very surprised at what you see, because it’s not just your view. It’s a view across the whole, entire org. And typically, this is kind of a roll of dumb like to do, right? It’s just product marketing, product management, sales, and then either solution consulting or solution engineers. You basically give it to them, put it in their hands, and see what kind of patterns that you see. And oftentimes, when we go through this exercise with some of the companies I work for, they end up changing their packaging completely because it was primarily set by product management and they don’t understand the go-to market motion. And all of a sudden, it’s just almost like upside down.
Mark Stiving
Yeah, that makes a lot of sense. And what I find fascinating about that is if you think about it, there really is a true answer to how valuable a feature is. But what we’re really getting is what are all the different perspectives inside our company for how valuable a feature is?
Johnny Cheng
Exactly.
Mark Stiving
Pretty cool. Johnny, thank you so much for your time today. If anybody wants to contact you, how can they do that?
Johnny Cheng
Yeah, just reach me on LinkedIn. I’m at /jdcheng, c-h-e-n-g. And thank you for having me, Mark.
Mark Stiving
That’s great. And I’m sure we’ll have the URL in the show notes. And to our listeners, thank you so much for your time. If you enjoyed this, would you please leave us a rating and a review? You can get instructions by going to www.ratethispodcast.com/impactpricing. And luckily, Dan Balcauski gave me a recommendation. It says:
“Highly recommended. Mark covers timely topics that is interesting and fun. Their podcast truly dives deep and provides actionable insights. You get a lot of takeaways which you can operationalize. Highly recommend the podcast.”
Dan, thank you so much. And finally, if you have any questions or comments about the podcast or pricing in general, feel free to email me, [email protected]. Now, go make an impact.
Tags: Accelerate Your Subscription Business, ask a pricing expert, pricing metrics, pricing strategy
