Price Segmentation Builder
Design your Good, Better, Best packaging. Drag and drop features (simulated) to create fences that drive upgrades.
Basic
Pro
Enterprise
Tier Health Check
Analyzing your fences.
Basic Tier
Should feel slightly 'painful' or limited. It exists to acquire users, not to monetize them fully.
Pro Tier
Should contain the 'Killer Feature'. This is where 60-70% of your revenue should come from.
Enterprise Tier
Focus on Security, Compliance, and Support. These features have low utility for individuals but high value for corps.
Execution Steps
Set your prices for Basic, Pro, and Enterprise.
List all your product features.
Check the boxes to assign features to tiers.
Ensure there is a clear 'Fence' (reason to upgrade) between each tier.
Pro Strategy
- Put 'SSO' and 'Audit Logs' in Enterprise. Large companies require them and will pay anything for them.
- Put 'Support' in higher tiers. Human time is expensive; don't give it away for free.
- Your 'Pro' plan should target your ideal customer profile (ICP). Basic is for hobbyists; Enterprise is for custom needs.
Core Concepts
The Fence
A feature or limit that forces a user to upgrade. (e.g., 'Up to 5 Projects' vs 'Unlimited'). Without strong fences, users stay on the cheap plan.
Anchor Price
The Enterprise price serves as an anchor, making the Pro plan look like the rational 'best value' choice.
Feature Bloat
Putting too many features in the Basic plan devalues your Pro plan. Be ruthless about cutting Basic features.
What is Price Segmentation Builder?
Price Segmentation (or Tiered Pricing) captures the maximum area under the demand curve by offering different packages to different segments. Instead of a single price that is too high for some and too low for others, tiers allow customers to self-select based on their budget and needs.
Best For
- • Launching a SaaS product.
- • Repackaging service offerings (Agency retainers).
- • Simplifying a complex product catalog.
Limitations
- • Can cause 'Choice Paralysis' if tiers are not clearly differentiated.
- • Requires strict engineering enforcement of feature limits.
- • Hard to change once users are locked into legacy plans.
Alternative Methods
Usage-Based Pricing
Pay-as-you-go (e.g., AWS, Twilio) instead of fixed tiers.
Flat Rate
One price for everything. Simple, but leaves money on the table.
Industry Applications
See how this methodology generates real revenue uplift in different sectors.
Dropbox
Users staying on free plan.
The 'Fence' is storage space. 2GB is enough to get hooked, but not enough to live. Upgrade is inevitable.
HubSpot
Monetizing different company sizes.
Fenced by 'Contacts'. As the customer grows and becomes more successful, they automatically move up tiers.