Yeah I think there’s totally a case to be made they should raise prices given the additional functionality. But in that case I think they’d likely need to remove the seat minimum to drive adoption.
My read is that Canva has a very hard time driving upgrades and needed to create a very straightforward incentive to get teams to add more users.
"Canva Teams" offers little to nothing from an end user perspective.
The additional Teams functionalities are: a bit of team management and reporting.
Their Teams pricing ($90/user) is actually lower these days then Pro ($110/user) pricing. Seems like they'd like to penetrate deeper in organizations through Product Led growth and are willing to take a 20% revenue hit/user for it.
When does this strategy make most sense according to you?
Yeah I think that's exactly right. It makes sense in a case like Canva when you're very PLG-focused, and using Sales resources exclusively for Enterprise deals.
1. Like most PLG companies, Canva probably struggles to identify users (lots of personal email account) that work for larger organizations. You’d be surprised how low the match rate is even with tools like Clay
2. Getting multiple small beachheads of (say) 3-5 Canva users enables them to go to senior stakeholders with a strong message (“your team clearly wants Canva. Do you want to talk wall2wall deployment within your org?”).
Thus the Teams plan has a dual use:
A. Get multiple users with a company in order to drive avg dealsize and increase retention rate (even with a 20% discount)
B. Data enrichment for the Sales team enabling them to target pockets of enterprise users.
What’s your take on Teams pricing?
A: they buy more seats, so volume pricing, improves growth opportunity (=lower)
B: they get more functionality (=higher)
Yeah I think there’s totally a case to be made they should raise prices given the additional functionality. But in that case I think they’d likely need to remove the seat minimum to drive adoption.
My read is that Canva has a very hard time driving upgrades and needed to create a very straightforward incentive to get teams to add more users.
"Canva Teams" offers little to nothing from an end user perspective.
The additional Teams functionalities are: a bit of team management and reporting.
Their Teams pricing ($90/user) is actually lower these days then Pro ($110/user) pricing. Seems like they'd like to penetrate deeper in organizations through Product Led growth and are willing to take a 20% revenue hit/user for it.
When does this strategy make most sense according to you?
Yeah I think that's exactly right. It makes sense in a case like Canva when you're very PLG-focused, and using Sales resources exclusively for Enterprise deals.
I think their logic is as follows:
1. Like most PLG companies, Canva probably struggles to identify users (lots of personal email account) that work for larger organizations. You’d be surprised how low the match rate is even with tools like Clay
2. Getting multiple small beachheads of (say) 3-5 Canva users enables them to go to senior stakeholders with a strong message (“your team clearly wants Canva. Do you want to talk wall2wall deployment within your org?”).
Thus the Teams plan has a dual use:
A. Get multiple users with a company in order to drive avg dealsize and increase retention rate (even with a 20% discount)
B. Data enrichment for the Sales team enabling them to target pockets of enterprise users.
What do you think?
Love this! The "small beachheads" point is great.
Makes selling way easier when you have multiple disparate teams all using the product independently.
I love seeing these changes over time. A big service to the SaaS community. Good analysis here too.
Thanks so much, Steven. Really appreciate the support!