Alex David on Unlocking Profit Potential, Pricing Integration, and AI Monetization

Product State Q&A

Alex David is the COO, Co-Founder at Corrily. He was formerly a Director at Simon-Kucher & Partners, and previously led Pricing at Segment.
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EC: What’s the key to solid pricing decisions?

AD: Pricing is not a solo function — most of the work done significantly overlaps with other teams (product, marketing, sales, finance, etc. Trying to solve one dimension of it without understanding its impacts on others is setting yourself up for failure.

Still, most organizations need help understanding how to structure the Venn diagram appropriately. The answer oftentimes winds up being pricing committees, but in my experience, that turns into death by committee with no real impact.

A good example is usage-based pricing — a great concept, but…

• How does this impact your revenue recognition?

• Are your salespeople able to properly estimate usage for committed contracts?

• How do your CSMs handle the crediting or overage conversation?

• Is that done simply in your product, or is it a support issue?

• How does this help your gross-margin projections for your finance team?

Answering only one of these questions will cause disruption across the organization.

EC: Is pricing the key to profitability?

AD: Price and profit are intrinsically linked.

Price is the most impactful lever you can play with regarding profitability, but that lever moves in both directions. Understanding how to optimize your pricing to take advantage of trends or adjusting your pricing for segments with unique WTP (willingness to pay) can completely change your margin opportunity!

Having a strong strategy that is evolving and growing with you can be critical in getting to profit dollars, which is now more important than ever.

EC: How do you transition from pricing strategy to execution?

AD: Strategy is only useful with execution. People spend a lot of time and money for consultants and advisors to give them ideas on improving their pricing. Don't get me wrong - that is really important.

But you need to be able to actually execute it!

Pricing changes or setting prices for the first time is a really terrifying experience. So much can go wrong (ask Unity and their $200M loss) — but you need to know when to stop doing the research and thinking about it, and actually start doing the thing.

On a related note, we’ve recently had a fair bit of success with an initiative we called Price-GPT, a free tool that allows anyone to drop in a pricing page (via URL or screenshot) to be analyzed. It’s been used several thousand times now, and it’s been amazing to see all the incredibly positive feedback.

A big takeaway for us is that AI has a definite place in monetization, both in obvious places, like model/price point optimization, and in places you wouldn’t expect - like competitor assessments, deal negotiations, and customer interviewing.

It’s become one of the number one things we talk about internally and with our customers so expect many more cool AI pricing tools in the near future!

“Understanding how to optimize your pricing to take advantage of trends or adjusting your pricing for segments with unique WTP can completely change your margin opportunity!”
- Alex David, Corrily