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Strategystandard
How would you price a new premium tier for a free photo storage app?
How to approach it
Start with who would pay and why. Storage limits, editing tools and sharing control each attract a different payer.
How a strong answer opens
“I'd start with who would pay and why. Extra storage, editing tools and sharing controls each attract a different kind of payer.”
Outline of a strong answer
Try answering out loud for a few minutes before you open this.
- Identify the likely payers and their needs
- Define what goes in the paid tier
- Use value, competitor prices and willingness to pay to set a range
- Consider monthly versus yearly and family plans
- Plan a test of price points
- Watch conversion, churn and free-user satisfaction
Where this question usually goes wrong
Setting the price from competitors alone, without defining what goes in the paid tier or testing willingness to pay.
Learn the method
Monetization and pricing in Module 5, Product strategy.
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