🚀 m3ter is now part of Salesforce Read the full press release here

2B SaaS pricing predictions report 2023

Our inaugural SaaS Pricing Predictions report from 2023 will show you just how quickly UBP is evolving. Check into our 2024 guide for the latest predictions and tips from the experts.

In this guide

• 2023 B2B SaaS Pricing Predictions Report
  • Key takeaways
  • 1) Tactics that lower barriers to entry for customers will be prioritized in 2023
  • 2) Some SaaS companies will raise prices in the next year, but others will strategically choose not to
  • 3) With customers cutting back, there will be more focus on flexible pricing and preventing churn
• Read all eight predictions in m3ter’s 2023 B2B SaaS Pricing Predictions Report

Contributors

Kyle Poyar Partner, OpenView Partners
James Wood Head of Product, m3ter
Andreas Panayiotou Director, Pricing & Monetization, Notion Capital
Nick Zarb Partner at Simon-Kucher & Partners
Todd Gardner Managing Director, SaaS Advisors
Christian Owens Founder and Executive Chairman, Paddle
Griffin Parry CEO and Co-Founder, m3ter

Companies are currently facing economic headwinds that require more intentional, data-driven conversations around pricing – especially since pricing will be one of the key levers for leaders to use next year. With this in mind, m3ter wanted to understand what experts are expecting in B2B SaaS pricing over the coming year. We’re excited to introduce our first annual 2023 B2B SaaS Pricing Predictions Report, packed with eight insightful predictions from industry experts and curated advice to optimize pricing and capture more revenue in 2023.

Companies have countless options, tools, and techniques they could use to optimize pricing. And yet most don’t invest enough time into getting it right. (One study from ProfitWell by Paddle found that companies spend just 6 hours on their pricing strategy over the entire life of their business – not per year or per quarter, total.)

2023 B2B SaaS Pricing Predictions Report

Key takeaways

To curate the top 2023 predictions for B2B SaaS pricing, we spoke with seven experts across the field, from founders and VCs to pricing consultants and advisors:

• Kyle Poyar - Partner at OpenView Partners
• James Wood - SVP at Insight Partners
• Andreas Panayiotou - Director of Pricing & Monetisation at Notion Capital
• Nick Zarb - Partner at Simon-Kucher & Partners
• Todd Gardner - Managing Director at SaaS Advisors Ltd.
• Christian Owens - Founder & CEO at Paddle
• Griffin Parry - Cofounder & CEO at m3ter

Reading the full report will give a deep dive on eight predictions for where SaaS pricing is headed in the coming year, as well as actionable advice from each of the contributors. Here is a sneak peek at three of the predictions we highlight in the report:

1) Tactics that lower barriers to entry for customers will be prioritized in 2023

The current economic headwinds are likely to leave customers hesitant when it comes to taking on new contracts or software, making long-term usage or time commitments, or increasing overall SaaS costs.

“Pricing tactics that remove adoption friction will be key in 2023,” says Griffin Parry, co-founder and CEO of m3ter. “Companies will need to make it as easy and low-risk as possible to become a customer.”

Tactics that we expect SaaS companies will use to lower barriers to entry for prospective customers include:

• Product-led growth (PLG) and product-led sales
• Usage-based pricing (UBP)
• Lower commitments
• Reverse trials

2) Some SaaS companies will raise prices in the next year, but others will strategically choose not to

The experts we spoke with were split on whether they expect to see across-the-board SaaS price increases in 2023. Most were in agreement, however, that SaaS businesses should be revisiting pricing often and iterating and adjusting as needed.

What about the impact of inflation? It will certainly be a key factor in pricing conversations, but it shouldn’t be a one-size-fits-all reason to increase prices. “Just because inflation exists doesn’t mean a price increase is right for software companies in 2023,” said Kyle Poyar.

3) With customers cutting back, there will be more focus on flexible pricing and preventing churn

Most companies are likely having conversations around cash concerns, and the customers of B2B SaaS businesses are no different. The experts we spoke with expect to see SaaS businesses using pricing to minimize the overall effect of those cuts (e.g. churn).

Whether SaaS businesses will face significant churn challenges depends on a number of factors:

• Whether a solution is “nice to have” or “need to have” – With a sticky product or critical tooling and infrastructure, the cost of switching is likely too high for the customer
• The flexibility of the pricing – Tactics like discounts for commitment and private pricing will require creativity from the Sales team but may help companies hold onto customers
• Usage-based pricing– UBP is likely to decrease logo churn in a time of cutbacks, as customers can decrease usage and pay less rather than dropping the tool altogether. However, the net revenue retention (NRR) advantage that UBP usually has may shrink when the economy is slowing down.