25 Pricing Strategies for Subscription Business – OneBillSoftware

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OneBill Subscription Commerce Platform e-Book
A publication of OneBill
www.onebillsoftware.com
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Top 25 pricing strategies
Recurring Frequency
Variant Pricing
Tiered Pricing
One-Time Purchase
Just-In-Time
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Featured Based
Loyalty Pricing
Usage Metering
Time of The Day
Bundle
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10
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Preferred Customer
Partner Pricing
Discount
Term Based
Rule-Based
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Threshold based billing
Overage Pricing
Elastic Subscriptions
Freemium
Trials
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Go Social
Coupons
Terminations
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A publication of OneBill
www.onebillsoftware.com
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Recurring Frequency
Recurring Pricing or frequency based pricing is
probably the common pricing model for any
subscription business! This form is often used
because of simplicity in sales model and
limitations in the subscription platform or
service. Pay as you go - 10 per user per
month The core strength of a platform as
OneBill - is you can define any frequency modes
like daily, monthly, quarterly and annually
virtually, with no programming, in support of
customer acquisition and retention objectives.
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Top 25
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Variant Pricing
Different strokes for different folks Variant
pricing implies that you can customize the
products / services to suit the customers budget
/ requirement. For example, you can offer a
simple - low cost plan for basic business users
to encourage them to experience your service -
and a progressive pricing plan for additional
features to lock them into to increase revenue -
via pricing personalization and automation.
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Just-in-time pricing
What is just-in-time pricing ? Just-in-time
pricing is a new idea making waves in the
subscription world. In this model, the price for
the product / service is derived dynamically at
the time of purchase based on different
attributes. For example, in the publication
and media world, the hottest news article will
cost 1.00, but if the same article was read
after a week, it will cost few cents or even
free.

No fixed price, dynamically fetched at the time
of purchase based on business rules defined.

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Tiered Pricing
Buy more to save more Tiered pricing or Volume
pricing is a strategy to price the service based
on the volume of purchase. The idea is to
encourage bulk purchase so that better discounts
are applied to orders that has volume. Check out
the different patterns of tier pricing
Volume Threshold
Price
Threshold Pricing Volume Based (Appropriate
charge for quantity). For 15 qty, the slab rate
is 9 and so the entire Q15 will be charged _at_
9. 9 x Q15 135
10 9 7 5
0-100 101-500 501-1000 1001-5000
Volume Based Pricing Charge based on the step the
quantity falls in For 15 qty, the charge will be
calculated as 1-10 _at_ 10 x Q10 100
11-20 _at_ 9 x Q5 45 Total 145
Volume Tier
Price
0-100 101-500 501-1000 1001-5000
10 9 7 5
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One-Time purchase
Price for service / product charged just
once One-time pricing is the simplest pricing
strategy that the subscription business has
inherited from e-commerce world. For some of your
customers, you may have a need for one-off sales.
OneBill gives the ability to either add one item
or load in an entire catalog to sell to your
customer base. For example, pay for installation
charges just once!
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Feature Based Pricing
Let your customers chose how they want to pay -
dynamically Feature based pricing is a
revolutionary strategy based on price
personalization of a product. This pricing model
allows customers to pay for the specific features
they use. This essentially means that charges
will be based on features within a service that a
customer choose.
For example, customers can select the IaaS
server requirement by entering the parameters
listed in the image. By choosing the appropriate
values for the requirements Memory, OS, number
of monthly Hours, Storage and Bandwidth, the
price per server is dynamically calculated to
give an estimate charges for monthly subscription.
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Usage Metering
Pay per Use! Usage metering is the way of
computing charges based on actual usage of any
service. The service usage unit can be in any
form, for example storage kilobytes, MB, GB,
calls, minutes, licenses, features, software
usage, data, messages sent , bandwidth etc.
Usage metering most importantly is a framework
tracking use of any unit type thus calculating
charges for customers invoice.

Usage metering example pay for number of SMS
used, minutes you spoke.

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Bundles
Bundle offers include two or more services that
are creatively pre-packaged as one single
offering Bundling is an offer that includes two
or more services . A creative way of combining
offers so that customers buy them as a
collection, not possible otherwise. Of course,
BUNDLE offer price advantage to customers because
they buy more than just one of your service
together. But _at_ OneBill, creating a bundle is
as cool as select, group and price!!!! Now
thats pretty cool!!!
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Loyalty Pricing
We value your continued business. Here is our
token of appreciation Loyalty Pricing is a way
to consider the loyalty points accumulated by the
customer at the time of purchase. OneBill has
unlocked the secret to accumulating rewards
points for customer redemption. Just turn on the
feature and track your customers loyalty points
accumulate based on our corporate policy.
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Time of the Day
Telco like pricing Price of the service
depends on when the service was used TIME of
the DAY Pricing model that is based on the time
of the day when the service was used / purchased.
You can create rules to specify the day and time
and give away special offers.
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Discounts

• Discounts There are different ways to
• offer discounts
• Discount offered for a particular service
• Special discount for specific customers
• Order time discount based on certain rules
• Bill time discount based on certain rules
  during billing

Focus on how to acquire customers, not build a
discount module for your billing engine!

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Rule-Based Pricing
Thats right! any pricing idea under the
sun!!! Rule Based Pricing is a way of defining
the price of a product based on various
attributes during the shopping flow. The price
of the product is dynamic and based on various
attributes that gets calculated during the
transaction. For example, the product can get
an discount of 10, based on the region of the
customer.

You think of a pricing concept and be assured
that it can be created and implemented using
OneBill Pricing Designer

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Preferred Customer
You define who your preferred customers
are! Preferred Pricing is a way of defining
certain categories of customers within the
business and offering special pricing to them,
thus making them feel special and ensuring
loyalty. For example, returning customers or
existing customers can get special discount than
a new customer who sign-ups for service.
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Partner Pricing
Create a channel network 11 3 Partner
Pricing is one of the complex tasks in
subscription business, because it involves
defining pricing at various levels for all the
products. Keeping track of price points, making
price changes, promotions and managing them all
can become a settlement nightmare. A
subscription platform approach that has support
for robust partner management features helps to
create an effective channel network of partners
and also easily manage the price changes at
various levels.

Create pricing at various hierarchies of channel
strategy and have complete control of price
changes at any level!

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Term Based
Get 30 discount on a one year contract Term
based pricing allows recurring pricing that is
fixed for a term. The price points for the
product remains unchanged irrespective of the
market / price fluctuations as long as the
customer is within the term period. Term pricing
helps businesses to get long-term commitment and
loyalty from the customer.
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Threshold based billing
Generate bills automatically when the service
reaches a threshold limit! In case of
Threshold based billing, the service providers
set a threshold limit that is custom for each
subscriber. When the subscribers account
reaches the threshold limit, the billing system
generates OnDemand bill and charges the customer
to the next pre-defined charge limit. For
example, in case of Skype VOIP service, 10 Skype
credit can be used for making calls until the set
limit. Skype billing system will automatically
charge customer's account for next 10 credit
limit when the customer exceeds the 10 limit.
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Overage Pricing
Dealing with excess usage beyond
entitlement Overage Pricing is a typical Telco
style of treating a charge when the user goes
over the service limited for the plan. For
example in case of cell phone providers, the cell
phone users get a monthly quota of minutes. When
a user goes over the minutes allowed under the
particular pre-paid / post-paid plan, he is
charged separately for the extra minutes. This
fee for the extra minutes is called overage fees
or overage charges. Overage pricing are
typically useful for services that has usage
component like minutes, bandwidth, storage space,
licenses etc.
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Elastic Subscription
Manage your subscriptions the way you want
Subscribers are on a lookout for the
flexibility to increase / decrease licenses,
upgrade / downgrade, suspend/resume licenses and
manage their renewals constantly. A platform
that helps manage the operations of a
subscription business efficiently is the key to
increase customer retention. We call it Elastic
Subscription flexibility offered to customers
to manage their subscriptions the way they want
to.

Increase / Decrease, Upgrade/Downgrade, Renewals,
Suspend/Resume, Cancel DIY anytime!

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Trials
Try me out first. Trials are the most effective
ways of converting free user to paid subscriber.
B2C businesses heavily depends on this pricing
model to attract their prospects to paid
customers. Example 30 days free trial
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Freemium
Give away basic features for FREE and CHARGE on
premium features FREEMIUM works for businesses
that thrives on volume of customers. Offer
service for free, pay for premium features.
For example, LinkedIn offers free service for
anyone to register their profile. Pay for
premium feature
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Go Social
Go viral with your social presence
Social Commerce - Cloud service providers can
now automate and measure social media campaigns.
OneBills Subscription Commerce Platform that has
extended traditional system offer functionality
via interaction with social commerce Facebook,
Google, LinkedIn, Twitter, FourSquare, and
others. A provider can monetize social media
efforts by a process of Create unlimited
offers and promote into social media Influence
encourage fan / influencer endorsement of
specials, offers, and services Reward
instantly update influencer profiles with
discounts for future purchases

What is needed are new approaches that recognize
and leverage the best social aspects of social
media and combine them with efficient commerce
practices directly within the social networking
environment

www.onebillsoftware.com


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Termination
Remember termination in your pricing
strategy Think of Termination policies when you
define pricing strategies for your products.
Termination clauses needs to be transparent for
subscribers so that they have the flexibility to
opt-out and opt-in anytime they wish.
Termination policies include the use cases for
CANCEL, Renew, Change Plans, Upgrades /
Downgrades where cancellation may become
applicable.
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Coupons
Coupons as an Online Marketing Strategy? We got
you covered!
COUPONS are experiencing an explosion in
popularityamong consumers and marketers alike.
For the customers, the attraction is clear
coupons are a quick and simple way to save money
if they are available, there is no reason not to
put them to use. For the latter, it can be a
little more complicated. Coupons offer a juicy
incentive for new customers, but coupon-based
promotion campaigns can be risky business Ella
Davidson of Coupons.org. With the integration
of promotion modules and coupons to the core
subscription platform, coupons can be easily
managed and offered Think of increasing your
business using coupons as a strategy and not
worry about complications!
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Early bird offers
50 off for first 500 customers Early bird
offers are a way to appreciate the first users
who sign up. The early sign-ups are generally
rewarded with discounts, trials, freebies, free
usage, etc so that businesses get maximum
customers signed-up for the services.
Effective billing system keeps track of the
customers, calculate and bill after adjusting the
offer, and helps publish the offer to the
products catalog seamlessly. The complex tasks
are automated, while the business focus on
acquiring early bird customers.
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Price Personalization
One-Size fits all PRICE offering is the
90s approach. Customer centric pricing is the
latest trend in Subscription world! Price
Personalization gives you the ability to deliver
dynamic and individualized customer pricing to
align with your solutions while maximizing your
operating margins. Personalization is the
evolving trend now. on-demand when where
how at the best price
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Leverage Pricing Strategies to transform your
business!
Thank you for joining us in exploring 25
pricing strategies. We believe that these ideas
will inspire you to aim for more in your
subscription business and take it to new
heights We hope that youll get inspired by
these 25 creative pricing strategies to add
innovation and freshness your business. If
youd like to share ideas that you have used,
wed love to hear from you. Feel free to
write to us sales_at_onebillsoftware.com or Call
1 [phone]
A publication of OneBill
www.onebillsoftware.com