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Per-seat pricing is off the table now

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Re: Per-seat pricing is off the table now

#21

Post by Terretta »

dastbe wrote: post #6

just charge for consumption. and if your users wants to pre-pay for fixed amounts of consumption then give them that opportunity. per user pricing always seems like a heuristic for how much you think a company can pay rather than getting them to pay for what they use. it subsidizes small companies and then ratchets up costs as they grow, which i guess is good for your business but sure feels like a dark pattern to me…

Even darker when startups are encouraged by SaaS pricing to avoid SSO like the plague.

Everyone is running around storing databases full of passwords, and for what? So they can put "CALL" on the Enterprise tier.

Re: Per-seat pricing is off the table now

#22

Post by metacritic12 »

AnhTho_FR wrote: post #14
metacritic12 wrote: post #4

Disclosure: this article is written by a company that specializes in per-metric pricing, and so the entire article is likely content marketing.

Hi! I work at Lago and co-wrote this article. We do per metric pricing and « per-seat » as well, we built Lago for pricing flexibility. This post is more around pricing for the downturn, than about our product. If you have specific feedback, because it is still perceived as self promotional, we are genuinely all ears. Thanks!

The points you make can be fine, even if it is content marketing. Its just useful to point it out as such since the conclusions can be affected by the marketing goal.

Presumably even if you support per seat pricing, thats not your main value add since SaaSs can quite easily implement per seat themselves.

Re: Per-seat pricing is off the table now

#23

Post by RileyJames »

disgruntledphd2 wrote: post #11
RileyJames wrote: post #9

Recently put intercom in place. Not only do you pay per seat (for support, and for ‘engage’ - marketing) but every single engage feature is effective CPM based. “People Reached” is charged at $125 per 1000 users. Your own users. I get it, it’s not a charity. But internally, I’ve had to lock down marketing from using any of the marketing features because we can’t afford them. And this is “re-marketing” effective, mark…

FWIW, I suspect intercom will become more customer friendly again, as they abandon their quixotic quest to alienate their small users in pursuit of enterprise ones.

That’d be nice. But why do you think they will?

The other missed opportunity is that we’d have moved our entire email re engagement journey from Drip to Intercom, but not at the rates they charge. We’re better off running both tools.

Re: Per-seat pricing is off the table now

#24

Post by disgruntledphd2 »

RileyJames wrote: post #23
disgruntledphd2 wrote: post #11

Earlier quoted context omitted.

FWIW, I suspect intercom will become more customer friendly again, as they abandon their quixotic quest to alienate their small users in pursuit of enterprise ones.

That’d be nice. But why do you think they will? The other missed opportunity is that we’d have moved our entire email re engagement journey from Drip to Intercom, but not at the rates they charge. We’re better off running both tools.

They changed their CEO back to the original founder recently. My understanding (from the outside) is that the replacement CEO was super focused on enterprise, whereas the founder-CEO was much more focused on smaller businesses and product led growth.

Mind you, this is all just speculation.

Re: Per-seat pricing is off the table now

#25

Post by newaccount74 »

AnhTho_FR wrote: post #16
epberry wrote: post #2

My favorite take on pricing ever is "Index to your Customers' Revenue Growth" (fourth card on this page) https://www.screenshotessays.com/browse . Basically saying that if your cost grows with your customers' revenue or some first derivative of that then you will be set for life.

A lot of people complain with SaaS that take a cut on revenue, when it’s not justified. For instance, if you are a payment processor, it makes sense to price based on the volume of transaction (your risk/work increases with the volume of transaction). But if you’re a « pure » SaaS, like a Sales commission software, would it make sense to take a cut on the amount of commission you manage?

Whenever you charge based on "value" rather than on based on cost of providing a service, you risk being undercut by a competitor.

Re: Per-seat pricing is off the table now

#26

Post by ralph84 »

Per-seat pricing is easy to budget for because it’s directly tied to headcount. Headcount is something non-technical people in finance and procurement understand. Be prepared for your sales team to be spending a lot more time explaining your pricing model if you decide to price based on some other metric.
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