A Primer: Subscription vs Usage Based Pricing Models

🔗 A Primer: Subscription vs Usage Based Pricing Models
mostlymetrics.com

There's been a lot of recent debate about which pricing business model is superior in tech: Subscription vs Usage Based.

Is Usage Based Pricing (UBP) just another hype-train contender, with a decent right hand but no jab? Or is it the real deal - a truly better way to align value to customer problems, and reap the benefits?

What I've found is there's no single answer to the question - it varies depending on what you are selling and who you are selling to.

However, what I'm increasingly made aware of is how the "best" Usage Based companies are outperforming the "best" Subscription companies across two core metrics:

Revenue growth

How fast is your topline scaling y/y

Net dollar retention

How well are you able to land, expand, and retain customers

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