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Unknown: Marketer of the day.
Episode, 777 differentiate and

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win the pricing game with
marketing expert Ajit Guman.

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Robert Plank: Hey everyone, and
welcome back to the marketer of

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the day podcast. We are going to
be talking about software today.

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We are going to be talking about
software as a service, we have

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Ajit Guman, who is the Head of
Product Marketing at narvaar,

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which is an enterprise grade
customer engagement platform

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that helps retailers inspire
loyalty beyond reason by

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enabling seamless post purchase
experiences. So Ajit, glad to be

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talking to you. Yeah, thanks

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Ajit Ghuman: for having me.
Robert,

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Robert Plank: Yeah, glad to have
you. And so what is your passion

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these days? Like you have this
software, you have this company,

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but what specifically in these
last few months has gotten you

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really excited and fired up?

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Ajit Ghuman: Yeah, thanks for
asking. Actually, you know, my

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profession, Product Marketing,
has a bunch of things, including

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positioning and messaging, but
one thing that's often found

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relatively hard, that I've
recently tried to master is

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pricing, and I found that that
has a really huge lever in terms

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of helping companies get more
value out of the market, as well

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as position better. And I've
consistently found that you can

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have the best product, great
positioning, but if you don't

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really have the pricing
structure down right, you could

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be leaving a lot of money on the
table. So it's something I've

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been looking a lot more into. I
also run the pricing channel for

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a community called revenue
collective. So we have regular

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meetups, and we try to figure
out how, how to improve SaaS

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pricing for different companies.

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Robert Plank: Okay? And, and,
let's, I mean, what I think is

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fun about some of the pricing
that you see, like with SAS

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products or with like services
is there's all kinds of ways to

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play with it, right? Like,
there's like, the like, the

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design pickle, sort of pricing
where it's a monthly fee and you

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use it as much as you want. And
a lot of these, like, cloud

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based tools where you edit,
like, audio or video, they'll

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say, like, you have a certain
amount of credits. Like, I

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really like otter these days,
like an AI transcription tool,

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and you join and they're like,
you have 9000 minutes of of

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minutes, and then when you use
it up, and it resets, and so

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it's so, I mean, like, what are
you really going for with

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pricing? Is it like, Are you
like, is your metric like to

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maximize, like, the profit, or,
like, the number of people in

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the door, or you're going for
like, simplicity, or is it just

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kind of like, whatever the
metric is that day? Yeah, that's

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Ajit Ghuman: a good question. So
one of the ways I think about

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it, which is, I think it's more
upstream, right? It starts from

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strategy. And what are you
trying to do as a business? So

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let's say you are, you know,
water.ai, you are trying to

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reach content creators. You're
trying you have a certain number

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of segments, right? So I'll be
presumptuous if I know their

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business, but what I can say is
that they will have a certain

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number of segments that create,
like some sort of a demand

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curve. And what they want to do
is they want to make sure they

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fit really well into the
segments, but they maximize

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revenue right from all of them.
So enterprises will be able to

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pay more. They may want advanced
capabilities. Individual users

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may be able to pay less, but
they want more simple

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capabilities and something
that's more tailored to them. So

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what they do is they want to
create offers that really

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customize to your needs, right?
And in such a way that they're

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also then able to scale their
business. So instead of having

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to go to, you know, let's say
they have 2 million customers,

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they can't talk to every one of
them, they'll have specific

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bundles for everyone. So they'll
design it that way, such that

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they can maximize the value of
the of the demand curve, right?

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So that's how they will plan
their packages. And then, you

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know, that's the structure. So
one of the key points is, if

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they think about the structure
right, and they make sure they

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measure the right metrics,
right, if they align the value

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that you're they are providing
to you, to the value that you

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are receiving as a customer.
Then they unlock a lot of

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benefit. And finally, they will
set the price point. So there's

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a sequence, sequential number of
steps this business will do to

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actually come up to the right
answer. And so it starts with

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the strategy, then the
positioning, and then they try,

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they're trying to make sure
they're delivering value to

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clients and then recapturing
that value on their end as much

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as possible.

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Robert Plank: And so I like how
your stress, your it's more like

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a strategy where it's not like
exactly a straightforward

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answer, right? You say there's
this huge amount of customers,

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and then we're looking for,
maybe we won't capture every

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type of customer. Maybe there
will be like, three different

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blocks or four different blocks
of like, this type of person.

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Are they enterprise? Are they
going to need these specific

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features, this big kind of
demand, and then go from there?

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And so that's how you do it, and
that's the right way, or, like,

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though you know the smart way of
doing it, and I imagine that a

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lot of people. That you come
across, just make a guess, or

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maybe they're stuck in some old
way. So, like, that's the right

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way to do it. But how do how do
companies, how do people without

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a strategy, do this pricing, or
is it just a random number or

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seeing what other competitors
do? Or so that's

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Ajit Ghuman: a good question. So
basically, one of two things

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happens, and it's not
surprising, and it's not

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something that people are doing
wrong. It's like when a company

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is small, if they're selling
into the enterprise, the sales

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team will go and bespoke pricing
deals to every single customer,

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because they're still trying to
figure out, what is their

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business model, what do
customers even care about? So

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they'll do that for a long time,
but they do it for too long.

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They jeopardize their own sales
cycle, right? They they confuse

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the prospects. Their sales team
is confused. Can't scale.

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They're going to get into those
challenges. So what these

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initial phases of the company
then, actually, at some point,

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has to be more systematized, and
they have. The company has to

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create a sales engine. So that's
one way this problem happens.

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The other way it happens is,
let's say I created a customer

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consumer app today, right, like
auto.ai and I said, Well, it's

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five bucks a month, and it's
five bucks a month for everyone.

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And then I got, again, all these
great businesses, and these

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businesses might be using this,
you know, one business might be

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using it for 10 million calls,
and one customer may be using it

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for 10 calls a month, and
everybody's paying $5 a month.

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So that that is not scaling,
right? That actually that is not

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even me losing money on the
table with software. There is a

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phenomena called, you know,
software is sort of a webland

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word, which means enterprises
may actually undervalue your

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product if it's too cheap, so
you actually have to keep it

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high priced enough to even
appear consistent with what they

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would expect for the price that
they're willing to pay. So so,

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you know, it's about really
aligning your business model to

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your customer base, right?
That's the function of a price.

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That's when you create a pricing
model so that you can scale your

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sales team so that you can align
well with all of the different

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type of customers you have.

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Robert Plank: And you're as
you're saying that you're making

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me think about different
software packages that it just

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it would feel wrong for it to be
less than a certain amount,

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like, I feel like, like
Photoshop feels like it costs

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six or $700 and they have the
monthly price, but still, it's

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like $53 per month. Like, if
Photoshop was like four bucks a

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month, I might think a little
bit less of Photoshop and things

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like, you know, Camtasia is like
300 bucks and like, it doesn't

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really, there's no real $20
version of that. And so how do

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we, I mean, how do we kind of
get that, that category all on

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its on its own, because, like, I
mean, like, otter is, like,

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almost, almost a verb, Camtasia.
There's other, like, lesser

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versions, but I still are, like,
Photoshop, same thing. Like you

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Photoshop it. So how do we, how
do we get on the path towards

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towards, like, that uniqueness,
that kind of being in our own

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category? Yeah,

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Ajit Ghuman: that's a good
question. So that's actually a

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question that not many people
ask, but essentially, there's

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two type of markets, right? One
market is like a blue ocean

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market. You start solving a
problem that nobody else is

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solving, and then you actually
even have to explain what is my

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product? Right before CRM was a
thing, somebody had to go and

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say, Well, you know, you have a
sales force, and they have to

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manage their opportunities, and
they will, you know, you have to

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do the whole thing again and
again. So at that point, it is a

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lot of evangelization, and the
pricing has to be then, very

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bespoke initially, when you
don't have a category and there

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are no competing vendors. So
that pricing in a world which is

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blue ocean, tends to be more
bespoke. It's it's a lot more

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about, hey, you know, let's
capture some value, but it takes

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a long time to stabilize the
pricing. So it is, it has

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benefits, but it takes time for
you to get to a repeatable

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model. The other challenge is a
model where it's extremely

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competitive. So customer service
software has 1000s of companies

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now that are vying for the
space, similarly for maltech

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companies or sales tech
companies, there the categories

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are so saturated that companies
are now fighting for survival

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and having a price war. So
ideally, where you want to be,

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at least, in my opinion, is in
some sort of a renaissance

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market where there was an old
vendor, there was an old,

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established price point. Let's
say, you know, like, let's say

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the oracles of the world created
some category, and now you're

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disrupting it with a new
offering. So I put markets in

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these three buckets, and based
on the bucket you are in, your

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pricing approach will be very
different. So in terms of you

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saying, you know category, let's
define the category. There is

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going to take much longer for
you to figure out what the price

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points are, because you have to
discover your customers,

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establish the use cases across
the customer base, and then

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understand, okay, these are my
key value drivers. This is how I

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will set the price.

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Robert Plank: And that's a lot
to think about. And even, like,

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as you explain that, it seems to
me that, like, it's, it's a

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never ending process, right?
Like, kind of like, like

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debugging software, eventually
the software is gonna, no matter

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what the surrounding software or
the hardware, will, like, add

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some new bugs, and there's
always that need to kind of

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reiterate it and update things
and kind of in the same idea of,

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you know, in our in our
websites, we need to kind of

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circle back and update things
every year or two, and the same,

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it seems like, as you're talking
about these things, like, like,

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use cases and how people are
using it, and how the other

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competitors are creeping in. And
maybe if we need to be on the

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lookout for, like, some new
undeveloped land, like, say, if

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you're like, a CRM, and there's
3000 other CRMs out there, maybe

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consider a CRM for, like, this
particular type of business, or

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with this new feature that
doesn't really exist out there.

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And so, yeah, it seems like when
we ransom getting that, it never

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ends, and something we always
need to be considering, because

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the job's never quite done,

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Ajit Ghuman: definitely,
definitely. And that's actually

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the key point that I have
realized. Many companies think

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of, you know, they have, they
think of their company evolution

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with strategy, positioning. They
know that they're going to

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evolve over time. That's given.
But when they think of something

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like pricing in their minds
like, Oh, this is very hard. I'm

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going to figure it out later.
And in the meantime, your

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business is growing, your
customers are changing, your

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landscape is changing. So my
point is, just think of it right

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next to your strategy and
positioning. It's you want to

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relook at it every six months.
Yes, relook at it every six

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months. Just get into the habit
of doing it, and then it'll

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become a lot easier.

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Robert Plank: And is there ever
a time when doing something

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stupid is a good idea? Like, is
there ever a time where you want

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to make something that's
normally paid and just make it

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free, or make or simplify the
pricing, just like, for the PR

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and attention, anytime that's a
good idea? Well,

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Ajit Ghuman: yeah. So you could
make something free for two

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reasons. One is for PR and
attention for sure. And I'm

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marketer, so I have even raised
these sort of examples in other

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companies before. Those sort of
things are really PR stunts.

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They help to get some press
coverage, and then they fizzle

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out, and you don't really get
too many free customers, which

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you probably didn't want
anywhere. So that's one

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category. The second one is, if
the come, if you are, let's say

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zoom software, right? The whole
world uses you now, then what

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you have is the power of
predefined funnel. You don't

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really need marketing anymore to
go and create a funnel for you.

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Everybody's just using you. So
if you get to a place where

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you're sort of the software that
people that has this viral

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component, then you just need to
say, Hey, this is the this is

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the product. It's free to use
for 15 days. Then you put them

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into this path when they start
using it, you say, these are the

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certain features that you have
to upgrade to. And so that's

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traditional. You know, in
marketing terms. It's called

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product led growth. And then
there are certain phases where

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you get qualified, and it's
almost like the software team

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will build the marketing funnel
within the product itself. So

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that works when you have a large
market, because conversion rates

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for this sort of free trial
software is from between four to

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10% and so you can that will
only work if your cost of

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acquisition is really low and
you have a large market.

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Robert Plank: And it seems like
that's lately, I've been

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thinking about that's a really
good thing. That's a really good

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goal, if you can make it happen.
Because, like, lately, we've

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been using, like, a lot of like
asana and slack, with a bunch of

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like with, I think, like, 10 or
11 employees using it, and the

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free version has gotten a spy,
but the whole entire time, when

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I log into Asana, it has these
little buttons of like, you

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know, if you upgrade from this
free plan, you can get all these

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extra rails and whistles. And
it's just been kind of every

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day. I've been using this to
this tool for like, seven or

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nine months, and I've just been
saying, like, Okay, I'm aware

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that there's something I can
upgrade to. And it got to the

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point where, like, we had to
upgrade. And we were just, like,

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using this. We were so embedded
in this system. But even if some

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solution had even better
features, it's like, I'm so, I'm

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so used to using this that
moving would be painful. So it's

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like, it's like, that seems like
something to be on the lookout

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for if we can get it

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Ajit Ghuman: totally so I follow
this VC, who used to run the

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company called Yammer, David
Sachs, and he has done this. He

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invests in bottom up B to B
software, where they try to have

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consumer app like virality based
on this free sort of usage

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approach. You start using it,
you get addicted to it, and then

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you start to upgrade, right? So
there's definitely a new class

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of software that's disrupting
old B to B software, which is

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bottom up, right? You don't go
to a high level executive or

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decision maker, you just let the
employees start using

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Robert Plank: it. So, so it
seems like just from from our a

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couple of comments.
Conversations here today is that

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there's different paths and
different tools in the toolbox,

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but it seems to hinge on where
do you want to end up, and what

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kind of customers do you want?
And it seems like, from your

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answer series, that that sort of
thing can change. If you're in

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the complete blue ocean and
you're brand new and you have no

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competitors, then go for the
bespoke but then as as things

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develop, then it may make sense
to to move things in different

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directions and to, I mean, we've
been talking about all kinds of

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cool examples, like I can zoom
and so I'm making curious about

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you personally, and you your
company, and like brands and

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companies that you helped, do
you have any interesting stories

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about that of like some company
that came to you and yet, worked

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your magic and solved a lot of
problems for them, right? So,

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Ajit Ghuman: you know, I only do
you know I'm doing this pricing

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work for my company, so a little
bit of that is confidential, but

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I've been talking to a lot of
pricing leaders in the valley,

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and there are some two examples
stand out in my mind. So, you

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know, I've been writing this
book. I've interviewed nine to

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10 people. One, one example is
from my last company, help

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shift, and it's when it was
growing. So when we were

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talking, you mentioned, hey, you
know, if the CRM is very

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competitive, maybe we need a CRM
for something else. There, the

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company was a customer mobile
software for, you know, customer

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service software for mobile. So
most of the customer service

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software is like Zendesk and
Salesforce. It's on the web. So

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this was more for like gaming
apps. So gaming apps have 10s of

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20 million users at any given
time, right? So they're all

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measured based on Mau or daily
active users. And when you're

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selling to this, these sort of
businesses, it's really the

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product managers who are
managing these software. So and

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it the number of customer
service agents in these

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companies is not very high. So
what happens is, if you say,

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Hey, I just have a customer
service software, I'm going to

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sell it to you for $50 an agent
you might just have, like, 20

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agents in the company. Won't
make any money if you're just

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going to do that. So what the
intelligent thing that Tushar,

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who was the original head of
sales at help, shifted, was he

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realized that the company
wouldn't make any money if they

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do perceived pricing, which is
the most dogmatic way of

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pricing, customer service
technology. So he said it's

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going to be $100 for 100,000
meu. And now that perfectly

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aligns with the value that the
product manager sees, because,

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according to the product
manager, the success of their

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product is based on the Mau. So
they and these apps have 10s and

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million, you know, millions and
10s of millions of Mau that

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resulted in the same account
having 10x more revenue in this

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Mau based model, then the per
agent model right, and that was

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justifiable, the customer agreed
with it, and that drove the

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company's revenue growth to
almost $20 million so there are

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like these fundamental things,
if you understand your market

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correctly and you pull the right
levers. So this is a very

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important even like the pricing
variable, then you can get to

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you can really make a lot of
movement, right? So I often say

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it's not about the price point,
but it's about the structure

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that you put in place and how
you communicate it to the

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customers. And

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Robert Plank: when you're
explaining that, that like, they

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kind of changed the I don't know
that the unit of measurement of

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the pricing. It's like, it's not
just a number, right? Some

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people like, get hung up on,
well, should this be $700 or

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$900 well, you can think in a
whole other dimension, because

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you can be having a different
underlying metric. And what it

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reminds me of is the whole when
the when the iPod came out,

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right? They didn't say it was
five gigabytes and it was 300

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songs, and it's like, okay,
well, that that makes more

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sense. I can get my head around
that. Even though we, both us

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tech guys, we know they chose
some arbitrary number, right?

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They said a song is 10
megabytes. We'll just split it

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up by that but, but that's
really interesting, that that

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customer with that customer
support solution had, instead of

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charging per agent, you charge
per per user. So yeah, I mean,

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that's a great example of us, of
us like, like, being aware of

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these things that can be done
and thinking outside the box and

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in a way that like makes us more
money, gets us more attention,

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and maybe even from your answers
here, like connects us to the

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buyers that we might not have
had because they were looking

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for the pricing to be in that
sort of some unit. So So yeah,

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so now that we're kind of
wrapping up and winding down on

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our conversation, what do you
want us to be aware of today,

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like after our discussion? Is
there a place to sign up and get

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alerted about your book when
it's coming out, or a way to get

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in touch with you, or what's the
next step here? Yeah, thanks

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Ajit Ghuman: for asking. So my
website is Ajit kuman.com and

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you can find, you know, when you
land on there, you'll see a link

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to the pricing book. If you put
in your email, I'll make sure I

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00:19:55,600 --> 00:19:58,780
send you a discount when the
book is out. Hopefully, this is

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00:19:58,780 --> 00:20:03,480
end of February. So it will be
out sometime in March, and if

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00:20:03,480 --> 00:20:06,000
you put in your email address, I
will make sure or just connect

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00:20:06,000 --> 00:20:09,000
with me on LinkedIn. My name is
Ajit komen, so it should be easy

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00:20:09,000 --> 00:20:14,040
enough to find what I do want to
leave with. You know, my agenda

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00:20:14,040 --> 00:20:18,060
here is more that instead of
relying on consulting companies

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that come in and do this one
time projects, I want to train

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product managers and CEOs to
just do this on their own. It's

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not really hard. It's just a
little bit of a mental block.

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Many times, if you get over it
and you know what the sequence

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00:20:31,820 --> 00:20:33,800
of steps you need to take, you
can do it on

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Robert Plank: your own.
Fantastic. So to spell that,

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00:20:37,160 --> 00:20:43,900
that website out, that is a, j,
i, t, g, h, u, M, a n, Ajit

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00:20:43,900 --> 00:20:47,860
gooman.com you can find out
about what a G has going on.

369
00:20:47,980 --> 00:20:51,520
Look him up on LinkedIn and and
sign up for that book. And you

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00:20:51,520 --> 00:20:54,820
know, you have an opportunity
Ajit to do some fun pricing with

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00:20:54,820 --> 00:20:57,400
the book. Like what comes to
mind is Seth Godin said, You

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00:20:57,400 --> 00:21:00,180
can't buy one copy of my book.
You have to buy 10 copies. So

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then you give to your friends,
and anything in the works there,

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as far as a unique pricing model
for your book,

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Ajit Ghuman: you know, some it's
like it's always easier to do

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00:21:10,620 --> 00:21:14,700
counseling for somebody else
than to yourself. So I think I'm

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00:21:14,700 --> 00:21:18,180
also a victim of that. I need
to, I need to think better about

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00:21:18,180 --> 00:21:22,460
my own marketing strategies. I
have a hypothesis, and so, you

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00:21:22,460 --> 00:21:23,360
know, let's see.

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Robert Plank: Okay, well, good.
You'll keep us waiting.

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00:21:26,360 --> 00:21:30,860
Ajitgoomin.com, is the place to
go to to find out what brand

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00:21:30,860 --> 00:21:35,000
new, innovative, crazy, good
techniques Ajit has coming out

383
00:21:35,000 --> 00:21:38,240
as far as pricing and getting
the word out there about your

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00:21:38,240 --> 00:21:41,440
product. Ajitgooman.com, thanks
Sujit for stopping by. I really

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00:21:41,440 --> 00:21:42,760
appreciate it. You should.

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00:21:42,760 --> 00:21:43,600
Ajit Ghuman: Thanks for having
me.

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00:21:47,140 --> 00:21:49,900
Robert Plank: Do you want a
podcast like this one? Well,

388
00:21:49,960 --> 00:21:53,620
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What if it was easy and you had

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