Sep '24 • Pricing & Packaging Strategy
Designing pre-approved tiers for usage-based model
I work in a CaaS (Communication-as-a-Service) firm offering communication APIs for SMS, Video, Voice, etc. For some of these APIs we offer usage-based pricing. We are mainly a sales-led organization with AMs in each region targeting and acquiring local and international customers.
Problem and impact: one the APIs is in a highly competitive, mature stage. We offer Sales several tiers of pre-approved prices per volume thresholds to increase deal velocity. Impact:
- Sales quoting highest volume threshold to unlock best price off list price
- Feedback from Sales about lowest price: we are not competitive anymore in some markets, hence higher escalation because pre approved prices are not realistic.
- Revenue goals not met because potential volume was unrealistic.
Question: how to better design a better pre approved pricing framework for usage based model? Aim for simplicity and keep it as is with more realistic volumes and prices? Offer more tiers and price ranges? Different framework?
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Designing pre-approved tiers for usage-based model
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