Too often, the only revenue stream (of the 7 available) that Software-as-a-Service (SaaS) vendors take advantage of is Subscriptions. Even more often, the pricing strategy applied to the subscription revenue stream involves tiers or packages; different subscription levels (price, features, etc.) based on a segmentation of customers. The tiers are often created after an analysis of the market with a goal of adequately addressing each segment. Sometimes they are pulled from thin air.
Regardless of the strategy, almost without fail pricing tiers are tied to an underlying usage metric (determined during Revenue Modeling) as part of the differentiation between tiers. This leads to the unwanted effect of punishing users for increased usage of your system. If you are doing this do not worry, so is your competition. Most SaaS pricing models use this type of tiering to some degree.
To really set your offering apart, consider that subscription tiers should not punish usage by making users upgrade when they reach a certain threshold. Instead, each tier up should reward the users for reaching certain milestones with the need for the additional resources or functionality available in the next level. You want to make the user feel good about moving to the next step, not bad that they "over used" the system. That could have the opposite effect you want; they could stop using the system altogether.
Do you need help figuring out which of the 7 Revenue Streams your SaaS business can leverage? Are you trying to figure out how to apply a pricing strategy to the revenue model you've developed? If so, call us at (972) 200-9317 or contact us other ways today!
Author: Lincoln Murphy (You should follow me on Twitter!)