| name | packaging-and-tiering |
| description | Design good-better-best packaging where each tier is fenced by a self-selection dimension (scale, use case, support, security) rather than a longer feature list, and separate core from add-ons. Reach for this when turning a feature set into tiers, when customers all pick the cheapest plan, or when tiers differ only by feature count. Pairs with value-metric-design. |
Skill: Packaging & Tiering
Packaging turns a value metric and a feature set into the plans a customer chooses
between. Done right, customers self-select into the tier that fits them. Done
wrong (tiers separated only by a longer feature list), customers learn to wait for
the cheap plan to grow the feature.
Step 0 — One opinion up front
Fencing is the whole game. A tier boundary must be a dimension the customer
self-selects on — scale, use case, support level, or security/compliance — not just
"more features." If you can't name the fence, the tier isn't a tier.
Step 1 — Pick the fencing dimension(s)
Choose 1–2 dimensions customers naturally differ on:
- Scale — seats, volume, usage allowance (the most common fence)
- Use case — starter vs professional vs enterprise workflows
- Support / SLA — response times, dedicated CSM
- Security / compliance / admin — SSO, audit logs, data residency (a classic
enterprise fence)
Step 2 — Build good-better-best
- Three tiers, occasionally four. More than four paralyzes the buyer and dilutes
fencing. If you "need" five, two aren't fenced.
- Design the middle to win. The middle tier is usually the intended default;
fence so most of the target segment lands there. The top anchors; the bottom
captures price-sensitive buyers.
- Place each feature deliberately — a feature in the bottom tier should be one
you're happy giving the price-sensitive segment; a fence feature (SSO, advanced
security) belongs at the tier that gates the upgrade.
Step 3 — Separate add-ons from tiers
Features only some customers value belong as add-ons, not as a reason to spawn
a fourth tier. Add-ons let you monetize the long tail without complicating the core
ladder.
Step 4 — Anchor and decoy deliberately
A visible enterprise/"contact us" tier reframes the middle as reasonable — but only
with a real fence behind it (custom security, volume, SLA). "Contact us" to hide a
number you haven't decided is a tell, not a strategy.
Step 5 — Pressure-test
- Does each tier boundary have a nameable fence? (If not, fix it.)
- Would a customer who should be in the top tier be tempted to under-buy the
middle? (Tighten the fence.)
- Does the bottom tier cannibalize the middle? (Move a key feature up.)
Output
A tier table (tier × fence × included value-metric allowance × key features), the
add-on list, and the self-selection logic — i.e. why each target customer lands in
the tier you intend. Hand WTP validation of the tier prices to
willingness-to-pay-research.
