Identify, monitor, and execute timely account expansions with real-time reports and indicators.
Proactively identify at-risk customers and prevent churn using automation, early warning insights, and more!
Understand your customers interactions with your product and make informed product success decisions.
Define and track onboarding by phase, user progress, account, and portfolios.
Intelligence-driven, scalable insights for onboarding, adoption, retention, and revenue growth.
Handle this critical component of the post sales customer journey.
We aren’t just any Customer Success platform. We have the insights, imagination, and technology that others don’t.
Get a complete view of your customer and all their moving parts.
Deliver consistent customer experiences and repeatable success.
Create the right scoring system for your organization.
Create alert rules that are flexible.
Manage, analyze, and optimize your customer interactions.
Track your tasks easily by account, product, and outcome categories for better efficiency.
Create dynamic segment across accounts and users.
Drive adoption, upsell and cross-sell using extensive product data.
Automate your actions, alerts, playbooks and more.
Proactively uncover key insights and receive data-driven recommendations for your team.
Transcribe your calls and catch key phrases used by customers to trigger actions.
Improve decision making and actions for enhanced outcomes.
Unlock value from your data with our embedded Business Intelligence solution.
Meet the industry’s first virtual assistant (SIA) designed for customer success and account management.
Our core values, team, and community
Get in touch anytime.
Don’t miss an episode of the Customer Success Intelligence Podcast
Our annual survey captures the current state of CS Intelligence and automation.
Resources for new and seasoned Customer Success teams.
Features and SDKs you can integrate into your apps.
Calculate the potential ROI you could achieve with SmartKarrot CS.
Consumption-based Pricing vs Subscription-based Pricing, who wins in this tug of war and which is more lucrative? Read on to know the ins and outs of this.
There is a possibility that the question of choosing between, ‘Consumption-based Pricing vs Subscription-based Pricing’ might be keeping you up all night. And it has been statistically proven that the 98% of the SaaS companies see their success rates by the choice of pricing models. But before you pick from the above-mentioned, you should have a clear-cut background and have the back-up of sound research. To save you a lot on the clock, here in the blog you will find the differences between the two and which one to pick as well.
Table of Contents
Quite contradictory to the Subscription-based Pricing model, here a consumer is charged on the basis of per unit of usage, and not on an overall monthly rate. In fact, only 38% of the SaaS businesses pick this pricing model over the Subscription-based one. While, where there are cons, there are pros as well.
This kind of pricing model seems fairer to the price. Here, the customer is paying for the exact amount of usage and not simply to the fact to access the platform, for their use. It is hugely fruitful for those businesses whose expenses rise up in direct proportion to customer usage. One such example is the cloud storage, where it is easier to apprehend the value and the expected cost too.
However, in a Subscription-based pricing model, a customer is supposed to pay on a monthly or an annual basis for accessing the platform. Some of the popular models include Netflix, Hotstar, Amazon Prime, etc. most of SaaS companies use this kind of pricing model to implement a subscription charge in a tiered format. For example, the customer will see subscribing options in tiers of features, price range, or course. Here is a screengrab from Netflix that seconds this point.
Now, a tiered subscription model is stated to be more profitable than the others. It gives your company the opportunity to enter the market with a low entry point and enhances your chances to upsell in the future. As a matter of fact, 75% of the SaaS companies opt for this kind of pricing model globally. Nonetheless, on the minus side, this kind of model has its own share of downs too. The high-usage of the customers might get more than the fair share out of the product, which can have a negative impact on the bottom line.
For the businesses who need to accurately break down their service offerings to their customers per usage, the consumption-based pricing model is the one that should be used. Clouding computing and Marketing automating platforms are some of the industries that fall into this category. However, on similar tracks, it can be cumbersome for some to quantify the unit where the products and services are eclectic and cannot easily be put to exact data usage. That is when the Subscription-based pricing model can save you a fortune with the following advantages.
Although both of these pricing models have their pros and cons, the subscription-based pricing model wins by a few segments. Let us get into that in details:11
So, who outweighs in this game of ‘Consumption-based Pricing vs Subscription-based Pricing’? Well, it all depends on the nature of your business and how best you find these acclimating to your scopes. Nothing should stop you from performing your research and coming up with a firm decision for your company. But on a personal note, the Subscription-based pricing does have a couple of more pros over the cons list. In the end, the winner should be the one that makes your customer happy as they are the real queen of your business.
An implementation engineer with six years of experience is a seasoned professional specialising in implementing and integrating complex systems and technologies for businesses. Possessing a diverse skill set that combines technical expertise, and project management capabilities.
Published February 16, 2021, Updated June 07, 2023
Delve into the world of Product-Led Customer Success with Jolyn Isabel...
06 Dec, 2023
Unlock the secrets of successful hand-offs between sales and customer ...
05 Dec, 2023
Unlock the key to customer success with Sana Farooq's expertise. Learn...
04 Dec, 2023
Sign up for SmartKarrot’s newsletter.
See how SmartKarrot can help you deliverwinning customer outcomes at scale.