SaaS or Pay-as-you-go: which payment model do you prefer?
Over the last few years, a lot of businesses are moving towards the SaaS model across a growing number of industries. From Amazon to Ugenie,"subscription-based SaaS pricing has worked so well to date because it offers stability and visibility."
However, there is a growing movement to the Pay As You Go Model because of some consumers do not like "the inflexibility and upfront friction." "Instead, usage-based pricing models are becoming increasingly popular because they create value through the product itself."
Here at Ugenie, we are exploring an innovative revenue share model with some of our clients. We have tested this at a small scale with our early adopters, and found it's a win-win both for us and the clients with certain business models. The difference between our revenue share option and a standard monthly SaaS is it enables the client to grow as fast and big as they can without worrying about their costs going up drastically. Further, as we become a 'partner' in their business, we are also more hands-on supporting them with their growth strategy and engagement.
With our revenue share model, you would pay a small, fixed upfront SaaS licence plus a percentage of the revenue generated by your membership. This percentage would be the same whether they have 100 members or 1000. You only pay for members you need.
We know that this model does not work for every business so we will always keep our standard SaaS pricing as an option as well.
So going back to debate between SaaS & and what we like to call 'Pay-what-you-need,' this growing trend may seem like it will put an end to the days of SaaS, but as we have already learned, 'Pay-as-you-go' doesn't work for everyone. We found this great article by Dawn Capital on the topic (who we have also quoted above) which lays it all out for you in more detail.
If you would like to discuss our revenue share model with us, please set up a time to speak to our team here.