Dharshanaa
Back to keyboard

Strategy

01 / 06Strategy · Case study

Developing a pricing approach for an early-stage AI product

For an early-stage product, pricing needs to balance accessibility, differentiation, and commercial sustainability.

Role
Strategy Analyst
Context
Early-stage AI product
Format
Anonymous case study

02 / 06The challenge

The challenge was to evaluate potential pricing structures while considering the product's positioning and the needs of prospective customers.

For an early-stage product, pricing needs to balance accessibility, differentiation, and commercial sustainability.

03 / 06My part

What I did, and what I did with the team

What I did

  • Developed pricing proposals
  • Researched competitor positioning
  • Compared subscription structures
  • Explored feature differentiation

With the team

Revised recommendations in response to stakeholder feedback.

04 / 06My approach

I considered four connected questions

  1. 01

    Market positioning

    How do comparable products structure their offerings?

  2. 02

    Customer accessibility

    What might make adoption easier?

  3. 03

    Product differentiation

    How should value vary across subscription options?

  4. 04

    Commercial sustainability

    What trade-offs should the business consider?

An original framework showing how the four questions connect. No real prices or feature configurations are shown.

Illustrative example · Fictional

Three ways a product could be priced

A fictional comparison created for this portfolio. It is not my employer's research, pricing or results, and it shows no real prices or product features.

  • Lower price level

    Low entry price

    Advantage
    Lowers the barrier for first-time customers.
    Trade-off
    Can make the product look less valuable, and leaves little room to raise prices later.
    Market positioning
    Competes mainly on price
    Customer accessibility
    Easiest for customers to start
    Product differentiation
    Little room between options
    Commercial sustainability
    Depends on reaching many customers
    Compare on four criteria
    Market positioning
    Competes mainly on price
    Customer accessibility
    Easiest for customers to start
    Product differentiation
    Little room between options
    Commercial sustainability
    Depends on reaching many customers

  • Mid-range price level

    Balanced subscription tiers

    Advantage
    Lets customers choose the level of value they need.
    Trade-off
    Needs clear differences between tiers, or customers may find the choice confusing.
    Market positioning
    Flexible, with several entry points
    Customer accessibility
    Start small and upgrade later
    Product differentiation
    Value grows across tiers
    Commercial sustainability
    Revenue spread across customer types
    Compare on four criteria
    Market positioning
    Flexible, with several entry points
    Customer accessibility
    Start small and upgrade later
    Product differentiation
    Value grows across tiers
    Commercial sustainability
    Revenue spread across customer types

  • Higher price level

    Premium positioning

    Advantage
    Matches the price to a distinctive, high-value offer.
    Trade-off
    Reaches a smaller audience and can slow early adoption.
    Market positioning
    Signals a high-value product
    Customer accessibility
    Harder for new customers to try
    Product differentiation
    Strong, focused on a complete offer
    Commercial sustainability
    Depends on willingness to pay more
    Compare on four criteria
    Market positioning
    Signals a high-value product
    Customer accessibility
    Harder for new customers to try
    Product differentiation
    Strong, focused on a complete offer
    Commercial sustainability
    Depends on willingness to pay more

05 / 06Iteration and what I produced

From a first proposal to a revised recommendation

  1. Proposal

    A proposed pricing structure, with its assumptions examined.

  2. Feedback

    Alternatives compared and stakeholder feedback gathered.

  3. Revised recommendation

    Feedback incorporated, rather than treating the first proposal as final.

Repeated across multiple versionsThe dashed loop shows the cycle starting again with a new version of the proposal.

I worked through multiple versions of the proposed pricing structure. This involved examining assumptions, comparing alternatives, and incorporating feedback rather than treating the first proposal as final.

What I produced

  • Competitive pricing research
  • Subscription and feature proposals
  • Revised pricing recommendations
  • Trial-related suggestions
  • Supporting commercial analysis

06 / 06What I learned

Pricing strategy involves more than selecting a number. It requires connecting customer expectations, product value, and business constraints.