Your Guide to PLG Pricing Models
👋 Hi and welcome to PLG Monetized newsletter. Every week we explore how leading SaaS companies leverage monetization to drive growth through self-serve sales.
Picking the right pricing model for your SaaS can have enormous impact on your company’s revenue and growth.
In this week’s newsletter, we’ll go review top pricing models the 7 pricing models used by top 250 SaaS companies across various different software categories.
#1 Seat Based Pricing
Seat based pricing model is the most common pricing model among top 250, coming in at 37.8%. Under this model, companies charge for access to software by licensing “seats”.
#2 Usage Subscription
Usage Subscription model has multiple tiers with one or more built-in usage metrics. As users consume the product and reach one or more usage limits, they must either upgrade to the next tier or find a way to work within their current tier limit.
#3 Usage Pay-as-You-Go
Usage Pay-as-You-Go pricing model has a usage metric that users “consume” and then pay for it at the end of the billing period (typically after a month). The bill will therefore often fluctuate month-to-month.
#4 Usage Drawdown
This model is similar to Pay-as-you-go, however the main difference is that the usage limit is determined up front and then users consume (or drawdown from it) through out the billing period and then it resets again at the beginning of the next billing period .
Tiered based pricing model is one where the difference among each plan is based solely on features.
Flat based pricing means same price for everyone, no matter what.
#7 Performance Based
Under this model, the users typically have unrestricted use of the product and they only pay for results.
About the SaaS companies in this study:
The study is based on information SaaS companies share on their public pricing pages. It spans multiple software categories across 250 SaaS companies .
All the data is available on pricingsaas.com - check it out for additional help on choosing the right model.
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