Pricing tiers

I’ve often struggled to understand various pricing tiers. It just seems like most of them are all about the business and not at all about the customer.

Before I go full rant, I should clarify that I’m talking about services who charge based on how many users you’ll have accessing their system. You know the ones who say something like it’s $9.99/month for up to 10 users, $19.99/month for up to 35 users, and so on.

It’s one thing if, at the different price points, you actually unlock more features and options but more times than not I see these pricing structures about nothing more than the volume of accounts/users…and that’s what really bothers me. Traditionally site licenses have also been priced this way.

The thing that *really* gets me about this pricing is that, especially in the world of ’the cloud’, costs often go down (not up) the more users you get.

Yes, from the business point of view this is great - costs go down as customers go up and profits soar! But to me, that’s really just a selfish way to cheat customers and your long term success.

If your costs don’t really (significantly) go up as your user count goes up, then I don’t think your prices should either.

Pricing should be tied more to the value you are unlocking for your client, to the problems you are solving and pain you are helping them to avoid…and I just don’t see how charging double (or more) just because they now have more users they want to push through your system is providing more value (if anything, really it’s causing more pain for them because of the higher price point).

So - please can we get away from user count tiers for pricing? Let’s *actually* make it about the customers and providing real value…instead of just saying it is but acting in a completely different way!

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This is the personal blog of Kevin Marshall (a.k.a Falicon) where he often digs into side projects he's working on for digdownlabs.com and other random thoughts he's got on his mind.

Kevin has a day job as CTO of Veritonic and is spending nights & weekends hacking on Share Game Tape. You can also check out some of his open source code on GitHub or connect with him on Twitter @falicon or via email at kevin at falicon.com.

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