SaaStr · 2015-09-17 · 3912d

SaaS Pricing Strategy Across Market Verticals: Using Competitive and Adjacent Comparables

Jason Lemkin outlines a methodology for determining SaaS pricing in enterprise markets by analyzing two types of comparables: direct competitors and adjacent products. Enterprise pricing decisions are primarily driven by historical spending patterns, budget allocation for similar-value applications, and secondarily by competitive pressures, rather than cost-based models.

2 metrics· Cited 0× in the knowledge base ·Open source ↗

Metrics in this report

Adjacent Product Price Ratio

50-100%%

range

Workday pricing relative to Salesforce in same organization

Competitive Price Multiplier

1.5-5xmultiple

range

when SaaS product is more valuable than direct competitors