How to Monetize your Product

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We recently concluded a networking event on January 8th whose theme included monetization of products, pricing and its various aspects. We also saw what kind of constructs in the product helps you leverage in pricing. Apart from these, it involved discussion of pricing design and approaches, online pricing methods, consumer properties and some practical cases where companies use these. Following are the keep points of discussion on how to monetize.

• Pricing can be broken into multiple facets/attributes such as
  
  - Pricing drivers - Profitability, Market share, Revenue, Signal, etc
  - Types - Competition, cost, value, etc
  - Stages - Penetration, skimming, diversification bundling, accelerators, specific offers, etc
  - Formula - Tier, usage, loyalty, etc
  - Mix - MSRP, Sell through payment terms
  



• Different pricing approaches/ways of pricing such as cost based, value based and competition based pricing, and where these are appropriate. A few practical cases such as Google were discussed.


• Different market places and few practical examples were discussed. Some of them involved Google, credit cards, Naukri.com and LinkedIn.


• Monetization models such as Add supported, Subscriptions based, Service revenue, Freemium (Free+Premium), Direct Sells (Apps), Sponsorship and Subsidies were discussed.


• Pricing model for cases such as PaaS, SaaS and IaaS were discussed, with an example of Amazon Elastic Compute Cloud (EC2) pricing.

Suggested reading: Business Model Generation