How should you price your digital products?

It is quite common to see new SaaS businesses set the price for their product low in the early days of their business to attract more customers. While this may be a good strategy, it also has its downside: How do you raise prices without angering and, ultimately, losing the customers that you have worked so hard to establish?

Whether you underestimated the cost of your product or intentionally set the bar low in order to attract clientele, you find yourself faced with the decision of whether or not to raise prices. Typically, it’s best to air on the side of good business and charge enough that you are making a profit.

Here is how to raise the price of your SaaS product and keep the majority of your customers.

1. Bundle New Features

It makes sense that you will release new features to keep your business fresh and moving forward. Instead of raising prices on your current features, charge adequately for your new features. Consider bundling the new features together and charging one price for the package.

For example, let’s say that you offer your original product at $10/month. Add a few new features to your original product and offer it at $20/month. Add a few features to that bundle, and charge $40 a month. The people who want the extra features will pay for them. The people who want to stay with your base offering will do so.

2. Grandfather Them In

Once your business starts to grow, your original customers do not make up a significant percentage of your customer base. In other words, raising prices for these customers will not generate as much revenue as you imagine it might.

Instead of raising your prices, set new prices. Is there a difference? You bet. Raising prices means angering “old” customers. Setting new prices means that your old customers are grandfathered-in, and your new customers pay a higher price for your product.

3. Announce Early and Be Blunt

Let’s say that you do decide to increase prices across the board. You are not worried about old customers versus new customers; everyone will be offered the same product at the same price. In this instance, the best you can hope for is that you avoid alienating your current customers.

If you want to keep as many as your current customers from leaving as possible, you have to approach the price increase the right way. Start talking about it on your blog months ahead of time. Send your current customers an email outlining the price increase and how it will affect them. Offer to answer any questions that your customers may have and leave it at that.

4. Don’t Isolate the Increase

If you want to avoid your price increase, sticking out like a sore thumb, do not isolate it. Any price increase should be bundled in with the release of new features or improvements. Whether these things are the reason for the price increase or not, your customers will believe that they are. What you will do is soften the blow for your current customers.

5. Time It Right

Utilizing software like Stripe analytics can help you understand when the time is right to increase your price. When you time it right, losing customers will not have as big an impact as you may think. You certainly do not want to lose a customer do to a price increase, but it will happen. From a business standpoint, it makes sense that you increase your prices when your churn rate is stable and hopefully get yourself closer to negative churn. Also, pay close attention to your projected revenue. If it’s low, raising prices is a no-brainer.


If you wait, you will keep finding reasons to keep your prices where they are. It is admirable to want to be fair to your customers but, let’s face it: you are in this business to make money. Are you going to do that by offering the same product at the same prices for the next 10 years? No.

The best way to increase prices and not royally tick off your current customers is to offer greater value. Whether you do this and how you do it, are entirely up to you. If you undervalue your product at the outset, there is no one to blame but yourself. Should your early customers be the ones to pay for it? Our opinion is that they should not.