Choosing a new SaaS pricing model

Pricing models shape buying decisions. We found the strongest option.

A hotel management software company was preparing to change how it priced its product. The decision affected positioning, sales conversations, customer acceptance, and future revenue. The pricing team needed evidence on how competitors charged, which models customers preferred, and how different approaches would affect the client’s position in the market.

The challenge

The market used several pricing structures. Vendors charged according to hotel sites, rooms, occupancy, usage, or other commercial measures. Each model created different incentives for customers and different risks for the vendor.

The client could see some public pricing information, but it was incomplete. Enterprise quotes varied by customer size and buying situation. Published price pages did not explain how vendors handled discounts, minimum commitments, implementation fees, or changes in customer usage. The client also needed to know how hotel owners and managers viewed each model.

A pricing change could not be based on competitor price points alone. The team had to understand what customers considered fair, predictable, and easy to budget. A lower headline price could still be unpopular if the billing basis felt uncertain. A simple model could also reduce the client’s ability to charge for the value its software created.

The client wanted to narrow the options before taking a recommendation into the business. It needed a pricing structure that customers would accept and the company could defend in competitive sales discussions.

What we did

We began by examining the pricing models used across the hotel management software market. The research covered four competing vendors and identified seven distinct models in active use.

We then surveyed independent hotels and hotel chains. The survey tested how buyers reacted to different pricing structures and the reasons behind those reactions. It explored practical issues such as predictability, perceived fairness, ease of comparison, and the connection between price and business value.

This customer evidence helped explain why some pricing models looked attractive in theory but created concern in practice. It also showed where preferences differed by customer type. A structure suitable for a small independent hotel did not always work for a larger chain with several properties and more complex purchasing controls.

Alongside the customer research, we gathered comparable quotes from each competitor. We used purchasing scenarios that reflected the situations most relevant to the client. This allowed the team to compare competitor prices on a like-for-like basis and see how its own proposed pricing would perform across different customer profiles.

The analysis separated the headline model from the commercial details around it. We reviewed the basis of the charge, the expected contract value, the effect of scale, and the likely customer response. We also considered how competitors might react if the client introduced a different structure.

We brought the findings together in a practical set of pricing options. Each option showed the customer groups it suited, the benefits and drawbacks, and the likely position against competitors. The aim was to support a decision, not produce a long catalog of market data.

Results

The pricing team used the research to develop two models for different market segments. Both reflected customer expectations and the commercial realities revealed through competitor quotes.

The client could compare each proposal against real market behavior. It understood where a pricing model would appear simpler, where it could create objections, and where the company could justify a premium. It also had a stronger basis for explaining the change internally and preparing sales teams for customer questions.

The work reduced uncertainty around a major product decision. The client entered the launch process with evidence on competitor pricing, customer preferences, and the trade-offs attached to each option.

The findings also improved the company’s view of value. Pricing discussions moved beyond a single price point and focused on how different customers measured the benefit of the software. That gave the client a firmer basis for future packaging and positioning decisions.

The team based its decision on direct evidence from buyers, comparable competitor quotes, and a clear view of how each model would work across the market. The final choice was more considered, easier to defend, and better matched to the customers the company wanted to win.