Choosing Pricing Tactics in a Recurring Revenue Business

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From free trials and freemiums to all-you-can-eat unlimited plans, offering various pricing and billing options can grow revenue over time through increased acquisitions and opportunities for cross- and upsells. With the help of a successful recurring revenue management system, you can seamlessly apply a wide variety of pricing tactics to products and services; then quickly make changes based on how the offer performs.

It’s important to understand the advantages and disadvantages of the different pricing tactics before choosing one for your product or service. Recurring Revenue Management for Dummies covers the various pricing tactics so you can make an informed decision on which is best for your business. Download the eBook to:

  • Understand the advantages and disadvantages of various pricing tactics
  • Learn what questions to ask when evaluating pricing tactics
  • Identify which pricing tactic best fits with your products and services

Free trials and freemium offers are popular to drive increased adoption of recurring services as they give some level of exposure to the service to entice some free users to convert to paying customers. However, some services don’t benefit from free trials or freemiums because they don’t offer enough to promote the real value of the service. Flexible payments are useful when dealing with long contract periods or if a usage-based model is in place, such as pre-paid cellular plans that bill for the upcoming month or post-paid utility services that bill for the previous month. Often times, when offering usage-based pricing, customers often ask for discounts based on their volume of business – tiered pricing delineates discounts upfront and discourages negotiating discounts with every customer. For example, volume discounts (where price increases when volume increases) encourage users to monitor or limit usage to reduce costs. Lastly, there’s buffet-style or unlimited pricing where companies can offer the subscription-like convenience of a fixed monthly fee for usage-based services with no usage limits (think cellphone packages).

Do you know which pricing tactic works best with your business model? Have you considered making a change and testing the results?

See how offering the right pricing tactic can transform your billing system into a monetization solution. Download Recurring Revenue Management for Dummies today.