Guide

Consumption-Based Pricing Playbook: How to Innovate on Your Revenue Model

Consumption-Based Pricing Playbook: How to Innovate on Your Revenue Model

Pages 22 Pages

This playbook provides a comprehensive guide to designing and operating a consumption-based pricing model for SaaS and digital services. It explains why usage-based pricing better aligns cost with customer value compared to traditional subscriptions, driving faster growth, higher retention, and improved customer trust. The document outlines five key focus areas: selecting the right value metric, modernizing sales compensation, rethinking revenue forecasting, helping customers predict and optimize spend, and leveraging data as a single source of truth. It also details financial metrics such as revenue recognition, RPO, net dollar retention, and cash flow management. The playbook emphasizes transparency, governance, and cross-functional collaboration as essential to successfully scaling a co

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