Ibbaka powers growth

Supporting Services

We have decades of combined pricing strategy and execution experience and a track record of helping B2B SaaS companies drive lasting growth with optimized pricing. We deeply understand what CEOs, CROs, and sales and customer success teams need to implement and succeed with value-based selling for new and existing products.

Illustration of two business professionals talking, one with a yellow shirt, the other in a suit, both standing.

Ibbaka Powers Growth

Pricing Strategy

Pricing can help companies achieve many goals, but it cannot achieve all goals at the same time.

Ibbaka helps companies to

  • Make sure the pricing strategy is aligned with the overall strategy

  • Ensure that there are clear winning aspirations for pricing and that the Key Performance Indicators (KPIs) are defined and tracked

Ibbaka has adopted Roger Martin’s Strategic Choice Cascade for use in its pricing strategy. It is a powerful framework for pricing governance. We have even developed a tool for you to use in your pricing strategy work. Download the Strategic Price Cascade for Pricing

Flowchart illustrating a strategic planning process with steps labeled: Winning Aspirations, Where to Play, How to Win, Capabilities, and Systems. Arrows indicate the flow and interaction between steps, with additional labels "Inform" and "Constrain."

Acronyms

  • ARR Annual Recurring Revenue

  • MRR Monthly Recurring Revenue

  • NDR Net Dollar Retention

  • LTV Lifetime Value of Customer

  • V2C Value to Customer

  • VR Value Ratio (LTV / V2C)

  • GtN Gross to Net

  • CRM Customer Relationship Management

  • CPQ Configure Price Quote

IBBAKA POWERS GROWTH

Value Model Development

Value models are the foundation of market segmentation, value communication, value-based selling and, of course, value-based pricing.

Without a value model, there is no value-based pricing.

The value model is a system of equations that estimates the economic value created for a customer or customer segment.

Value models are developed through analysis of usage data and value path completion, validated with interviewers and confirmed and extended through market research such as conjoint studies.

Ibbaka uses the Economic Value Estimation or EVE approach developed by Tom Nagle and his collaborators in the book The Strategy and Tactics of Pricing.

Ibbaka develops, validates, maintains and evolves value models for our customers and hosts them in the Valio Pricing and Customer Value Management platform.

IBBAKA POWERS GROWTH

Packaging & Pricing Design

Ibbaka helps its customers package their software and then design prices for each package. We help you decide on a packaging architecture and map the value paths in each package and how they connect.

  • One Big Package

  • Independent Modules

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We then work with you to design pricing that supports

  • Ease of purchase

  • Growth in package

  • Upsell and cross-sell

  • Retention management

Ibbaka has special expertise in the design of usage-based and hybrid pricing. This approach to pricing has been proven to lead to more predictable revenue and to higher package growth.

Pricing models are implemented and managed on the Ibbaka Valio Pricing and Customer Value Management platform.

By having the value model and the pricing model dynamically connected on the same platform, one can align price with value and make pricing a win-win game. Read about Model-based pricing in this blog article.

Ibbaka powers growth

Customer Value Journey Mapping

Value and price are central to the customer journey. Ibabka has taken the standard customer journey map and layered it in swimlanes to clarify the impact of price and value on the customer experience.

Ibbaka can augment your existing customer journey with value and price swimlanes or develop and support your customer journey map.

Ibbaka can conduct research to inform the customer value journey and quantify the impacts of each touchpoint.

A customer journey map with value and pricing swimlanes will help you to

  • Align value and pricing communication with the customer experience

  • Align price with time-to-value and the value over time (this is an important input to pricing design)

  • Identify opportunities for in-package growth, upsell, cross-sell and reduce churn

Ibbaka Powers Growth

Pricing Model Go-to-Market

It is not enough to develop new packaging and pricing. The best pricing can fail if its introduction to the market is not planned carefully and the communication and policies are not well thought out.

Introducing new pricing has three aspects

Market response
How will analysts, commentators and competitors respond to the new pricing and packaging

New customers
how will the pricing and packaging be introduced to new customers:

  • How is pricing put in the context of value?

  • Should pricing be on the website?

  • How are discounts managed?

Existing customer base
How will existing customers be migrated onto the new packaging and pricing? This is critical to the success of a SaaS business. Having customers on multiple legacy pricing models saps the energy out of a SaaS business and makes it much more difficult to scale over time. Ibbaka has developed a set of best practices for customer migration that includes

  • Segmentation of customers

  • Communication and messaging

  • Incentive packages

Ibbaka Powers Growth

Pricing AI Development

Ibabka is pioneering the application of Generative Artificial Intelligence to value and pricing. Ibbaka can help you leverage Generative AI and put it to work to make your pricing more effective and more efficient.

Generative AI is being used to help with

  • Defining value propositions

  • Comparing the value propositions of different solutions

  • Evaluating pricing models

  • Generating ideas for pricing models

  • Pricing communication engines

Generic Generative AI systems have two serious shortcomings when it comes to this type of work.

  • They are generic and do not easily capture the strategic differentiation of a solution, especially a new or innovative solution.

  • They can make errors when generating the mathematical equations on which value and pricing depend

Despite these shortcomings, they have great potential in several areas of pricing work.

The limitations of Generative AI can be addressed in three ways

  1. Good process design that keeps the human in the loop

  2. Augmenting the standard Large Language Model (LLM - GPT is one example of an LLM) with proprietary parameters

  3. Tuning the parameters to manage hallucinations

  4. Integrating other approaches to machine learning, such as pattern recognition and predictive analytics

Given the role that Pricing AI will play in the coming years, Ibbaka is also contributing to Pricing AI ethics. We support three basic principles.

  • Is it clear how we set prices? Can we explain this to ourselves? Can we explain this to our customers? Is our website clear on this? Can sales communicate it?

  • “Is our pricing unbiased?” Do we treat all of our customers in a way that respects their backgrounds and needs and does not take advantage of their situation or weakness?

  • Are we creating differentiated value? Do we use this to set prices? Do we adjust prices based on the value we are creating? Are we sharing that value with our customers?

Read More on Pricing AI ethics

Get in touch with a pricing expert.

Our customers see their average contract value increase 2X-4X, and their NDR (Net Dollar Retention) improve by approximately 10%