Is your pricing model hurting growth?
Misaligned pricing can lead to revenue leakage and high churn, slowing your company’s growth and frustrating your team.
You’re stuck between simple flat rates that don’t scale and complex tiers that just confuse potential customers. It’s a common and costly dilemma.
According to McKinsey & Company, 82% of SaaS companies plan price hikes. This pressure makes finding the right strategy more critical than ever before.
But there’s a better way forward. By implementing proven pricing frameworks, you can align price with customer value and unlock predictable revenue growth.
In this article, I’ll show you how to price a SaaS product using six proven strategies. These modern approaches move beyond guesswork to help you maximize revenue.
You’ll gain actionable frameworks to confidently set prices that attract customers, boost retention, and satisfy your leadership’s growth expectations.
Let’s dive in.
Quick Takeaways:
- ✅ Structure tiered pricing by aligning each plan with specific buyer personas, enabling natural upgrade paths.
- ✅ Implement freemium models by offering core value, then strategically gating advanced features for compelling upgrades.
- ✅ Combine base subscriptions with usage-based components, like email sends, for predictable revenue and value capture.
- ✅ Monetize AI features as distinct add-ons or via consumption-based models, such as per AI-generated report.
- ✅ Implement outcome-based pricing, directly linking your fee to specific, measurable customer results like cost savings.
1. Tiered pricing structures with value alignment
Is your pricing leaving money on the table?
Misaligned tiers confuse prospects and cause churn, leaving revenue from different user segments untapped.
This friction means power users are undercharged while other segments are priced out. It’s a critical growth roadblock that directly impacts your bottom line.
PriceWell found 78% of SaaS companies now use value-based pricing. This approach links cost directly to the outcomes customers achieve.
Getting this wrong is a costly mistake. Let’s build a structure that drives growth and revenue for you.
Align your pricing tiers with clear value.
Tiered pricing works best when each plan is carefully built around a specific buyer persona, solving their unique problems at a fair price.
Base your tiers on features or usage that scales with customer growth. This creates natural upgrade paths as their business needs expand over time.
For instance, a basic plan offers core features, a pro plan adds collaboration tools, and an enterprise plan provides advanced security. This is how to price a SaaS product effectively.
This makes the value of each new tier obvious.
This model gives customers clear choices and provides you with a predictable, scalable revenue framework built for long-term customer growth and retention.
Ready to optimize your SaaS pricing for predictable, scalable revenue? Book a discovery call with our SaaS marketing agency today and discover how we can help achieve your growth goals.
2. Freemium models with strategic upsells
Is your freemium plan a cost center?
Without a clear conversion path, it attracts users who never upgrade, draining your resources without generating any real revenue.
You end up with a high user count but low lifetime value. Your free tier becomes a dead end, increasing support costs while failing to fuel business growth.
A Vertice report found SaaS spending per employee reached $7,900 annually, proving customers will pay for premium features.
Failing to convert them is a missed opportunity. The solution lies in building strategic upsell paths into your freemium model.
Let’s build a value-driven freemium model.
A strategic freemium model hooks users with your product’s core value, then creates compelling reasons to upgrade by gating advanced features or higher usage limits.
Your goal is making the free experience valuable enough for adoption but limited enough to encourage paying for more power.
Correctly pricing a SaaS product this way involves creating clear upgrade triggers. For example, you could limit:
- The number of projects
- Team seats
- Advanced reporting features
This makes the upgrade feel completely necessary.
This transforms your free tier from a simple cost center into a powerful top-of-funnel engine that systematically converts engaged users into reliable, predictable recurring revenue.
3. Hybrid subscription+usage-based pricing
Don’t choose between fixed and variable.
Pure subscriptions leave money on the table, while usage-only pricing creates unpredictable revenue that frustrates your finance team.
You need stable recurring revenue but must also capture value from power users. This pricing dilemma often stalls growth and creates friction with customers demanding flexibility.
A Benchmarkit report shows hybrid models achieve 21% growth, the highest median rate. This proves combining models unlocks superior scalability and stability.
This challenge is a common roadblock. Fortunately, there is a proven and effective middle ground for you.
Enter the hybrid pricing model.
This modern approach combines a predictable base subscription fee with a variable component based on consumption, offering you the best of both worlds.
It provides essential revenue stability while allowing you to monetize heavy usage. This perfectly aligns price with value for every single customer segment.
For example, a marketing automation tool might charge a flat fee for platform access, plus overages for email sends. Properly pricing a SaaS product this way ensures fairness.
It’s a true win-win pricing structure.
This model delivers predictable income while ensuring your pricing scales directly alongside the value your customers receive, preventing revenue leakage.
4. AI-driven feature monetization strategies
Monetizing your new AI features is tricky.
Simply adding them to existing plans devalues your innovation and leaves significant potential revenue on the table.
This creates a serious monetization dilemma. Gating AI behind a top-tier paywall limits adoption, while offering it for free erodes your R&D investment.
A recent Maxio report found 44% of SaaS companies now charge for AI features. This shows a clear trend toward treating AI as a primary, billable value driver.
So, how do you price AI fairly? The answer lies in targeted monetization strategies.
Treat AI features as distinct products.
Instead of just bundling, offer AI features as optional add-ons or through a consumption-based model, similar to the hybrid models we discussed earlier.
This lets customers pay only for the AI value they use, making your pricing feel fairer and more transparent across all your user segments.
For example, a project management tool could charge per AI-generated report. Knowing how to price a SaaS product this way directly links your cost to the outcome.
This approach creates a clear value exchange.
It maximizes revenue by capturing value from low-tier and high-tier users alike, turning your AI from a cost center into a profit driver.
5. Outcome-based value pricing frameworks
How do you price for customer success?
Pricing by features misses the business value customers gain, like increased revenue or significant time savings.
This forces you to defend features instead of ROI, leaving money on the table and making renewal conversations more difficult than they need to be.
Experts at Metronome predict a permanent shift to outcome/usage-based models as buyers demand this direct alignment.
Ignoring this makes your product a commodity. Let’s align your price with the actual value you deliver.
Shift your focus from features to outcomes.
Outcome-based pricing directly connects your fee to a specific, measurable result your customer achieves, such as cost savings or leads generated.
This model requires you to deeply understand your customer’s business and define a clear value metric that both sides can easily track and agree upon.
For instance, a marketing automation platform could charge based on qualified leads delivered. This is a powerful approach for pricing a SaaS product as it aligns your success with theirs.
This transforms pricing into a true partnership.
When customers see a direct link between what they pay and the results they get, your price becomes an obvious investment, not just an expense.
Ready to align your pricing with the true value you deliver? Book a discovery call to explore how our agency can help you implement outcome-based strategies for maximized revenue.
6. Segment-specific elastic pricing approaches
One price rarely fits all your customers.
A single model undercharges high-value users or alienates smaller ones, leaving significant revenue on the table.
This creates a major value gap. You fail to capture maximum value from enterprise buyers or risk pricing out entire market segments you could otherwise serve profitably.
In fact, Vertice found 60% of vendors mask prices with complex structures. This proves different segments have unique price sensitivities.
Without a clear strategy for this, you are just leaving money on the table. Let us fix that.
Use segment-specific elastic pricing.
This approach allows you to adjust pricing based on the unique characteristics and value perception of different customer groups, like startups versus enterprise clients.
You can tailor plans by geography, company size, or industry vertical. This ensures maximum value capture from each distinct customer segment.
For instance, a marketing tool might offer a lower price for non-profits. This is a critical step for pricing a SaaS product to expand your reach.
This is a true win-win for everyone.
This targeted method moves beyond one-size-fits-all, aligning your revenue strategy with how different customers truly perceive and receive your product’s complete value.
Conclusion
Pricing shouldn’t be a guessing game.
Leaving money on the table with static, outdated models costs more than you think. It directly impacts your startup’s growth and long-term viability.
Invespcro reports that 8.7% year-over-year SaaS price inflation now exceeds market rates fourfold. This reality pressures legacy pricing strategies to adapt or risk becoming obsolete in today’s competitive landscape.
But there is a clear path forward.
The six frameworks I’ve shared provide the actionable strategies you need. They help you align price with true customer value and drive sustainable growth.
Learning how to price a SaaS product is about moving beyond guesswork. By implementing even one value-aligned model, you create a win-win partnership with your customers.
I encourage you to start by testing just one of these strategies this quarter. See how it impacts your revenue and customer retention.
Achieve the predictable, profitable growth you need.
Ready to achieve predictable, profitable growth? Book a discovery call today with me to discuss how we can help you implement a value-aligned pricing strategy tailored for your SaaS.
