7 SaaS Price Scaling Models to Bring Value-Based Price Metrics to Life

What is it: 

A customer’s price is directly proportional to the price metric (e.g., $10/user for all users) 

When would you use it:  

• The value of each unit doesn’t change based on the number of units purchased
• Customers and sales teams highly value simplicity
• Price metric changes are predictable for the customer
• Costs also scale linearly as the metric volume increases

What is it: 

The price per unit of incremental units of the metric decreases as the customer crosses certain thresholds.

When would you use it:  

• The SaaS company prioritizes a logical progression of price levels over the ease of calculating the total price for a specific metric volume
• The value of additional units of the price metric decreases with higher volume 
• Volume discounts incentivize metric growth for customers  
• Larger customers with high metric volumes expect discounts to purchase the product 
• Costs to serve per metric unit decrease with higher volume 

What is it: 

The total price of all units of a metric decrease at certain metric volume thresholds

When would you use it:  

• You prioritize simple, transparent pricing communication over preventing all downsell scenarios 
• You want to create clear incentives for customers to upgrade to higher usage tiers 
• Your sales team can leverage price drops at thresholds as upsell opportunities 
• Your product has distinct value tiers that align with the pricing "teeth" 

What is it: 

Customers pay a fixed recurring payment with a transactional payment on top. Making a higher commitment for the fixed fee upfront reduces the per unit price of the transactional payment.

When would you use it:  

• Customers have varying tolerances for variable costs, potentially due to selling across multiple industries 
• Predictability of the metric can vary significantly for customers 
• The SaaS company values predictable revenue streams 
• SaaS product has a high upfront cost of provisioning for the customer 

What is it: 

The price does not change with Metric until a capacity “limit” is reached, at which point you pay per unit.

When would you use it:  

• Metric is usage-based 
• Customers have metric volumes under the capacity “limit” 
• Product dependencies exist where using a higher volume than the capacity “limit” will result in poor experience for customers 
• The value and willingness to pay of customers increases with higher volume of the metric than the capacity “limit” 
• Costs continue to increase with the usage metric above the capacity limit 

What is it: 

The price does not change with Metric until a capacity “limit” is reached, at which point you pay per unit.

When would you use it:  

• Metric is usage-based 
• Customers have metric volumes under the capacity “limit” 
• Product dependencies exist where using a higher volume than the capacity “limit” will result in poor experience for customers 
• The value and willingness to pay of customers increases with higher volume of the metric than the capacity “limit” 
• Costs continue to increase with the usage metric above the capacity limit 

What is it: 

A customer’s price is fixed within a specified volume “band” of the metric

When would you use it:  

• Some predictability on pricing is desired by customers 
• The exact metric volume is hard to predict 
• Small oscillations in unit volumes do not adjust the value received, but larger “step-size” changes do 
• The value of incremental units of the metric decreases as metric volumes increase