Does usage-based pricing call for a new growth infrastructure stack?
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“It’s not either usage-based or subscription pricing,” VC firm OpenView wrote in its second State of Usage-Based Pricing report. These hybrid approaches call for new tools, but which ones? Let’s explore. — Anna
Complex pricing on the rise
As we learned earlier this week from OpenView’s latest report, usage-based pricing is rising, but not replacing other models.
Sure, more SaaS companies are billing their customers based on how they are using the service. But this often comes in combination with other pricing approaches, such as tiered subscriptions.
OpenAI’s ChatGPT is the latest example of this hybrid pricing approach. In addition to its free tier, it introduced ChatGPT Plus, a fairly plain subscription model starting at $20 per month. But the company also said it was “actively exploring options for lower-cost plans, business plans, and data packs.”
Data packs: That would be a form of usage-based pricing, but one that wouldn’t replace subscriptions. Meaning that ChatGPT would join the growing range of complexly priced products.