A price structure is not three prices around a middle option.
A price structure is not three prices around a middle option. It organises segment self-selection through differences in value, capacity and service. A good boundary makes the higher plan attractive for costly needs without artificially degrading entry level. Its effectiveness appears in mix, contribution, retention and migration.
Decision and method.
Move a feature or limit between plans only if the mix gain exceeds service cost and risk of churn or workaround. Identify usage intensity, criticality, integration, governance, support and willingness to pay; do not segment only by company size. Compare seat, usage, transaction, outcome and flat-fee metrics for value alignment, predictability, auditability and administration cost. Put each capability in the plan whose customers value it and whose economics can support it; document marginal cost and workaround behaviour. Apply a transition matrix with net price, margin, churn and transition cost, testing gradual cohort rollout.
Worked example.
Among 1,000 customers, mix is 50% Essential, 35% Pro and 15% Enterprise; unit monthly contributions are €35, €71 and €124. A boundary changes mix to 42%, 40%, 18%, while adding €3 service cost to Pro. Baseline: 500 × 35 + 350 × 71 + 150 × 124 = €60,950. New mix: 420 × 35 + 400 × 68 + 180 × 124 = €64,220. Monthly gain is €3,270 before churn. It can be tested if losing fewer than 51 average monthly contributions remains plausible.
Checks and limits.
Price metric must rise with verifiable customer value; every boundary has a distinct need and cost; simulate upgrade, downgrade, churn and workaround together; give existing customers a documented transition rule. A structure optimal for acquisition can become poor after usage expansion. Migration simulations depend heavily on between-plan elasticities, and too many levels raise choice, sales and administration cost.
Resources and sources.
Download the price-pack canvas. Related: measure perceived value, link packaging and retention, avoid offer overlap. Sources: Moorthy (1984); Shaked and Sutton (1982); Dolan and Simon (1996).