Pricing is not just a number. It’s a strategy, a message, and a growth lever. The right pricing model can help a startup grow faster, reduce churn, and acquire better customers. In this article, we break down the top pricing models used by SaaS and DTC startups using 30 real-world stats. Each stat is a window into how high-growth companies make pricing work for them.
1. 61% of SaaS startups use subscription-based pricing as their primary model
Why subscriptions dominate in SaaS
Subscription pricing is the go-to model for most SaaS startups—and for good reason. It gives predictable monthly recurring revenue (MRR), which is critical for cash flow planning and investor reporting. When you know what’s coming in every month, you can confidently plan spending on marketing, hiring, or product development.
Startups that offer software services often bundle their tools into a monthly or yearly payment. This gives users ongoing access, keeps them engaged, and gives startups a chance to keep improving their product while continuing to charge for it.
The value of predictability
Startups live or die by cash flow. With subscriptions, forecasting becomes easier. You know how many users are on which tier and can anticipate upgrades, downgrades, and churn. That’s valuable not just for operations but also for pitching to investors.
Actionable takeaways
- Always offer annual plans at a discount to reduce churn and get upfront cash.
- Keep your billing simple. Don’t confuse users with too many tiers.
- Track MRR, churn rate, and customer lifetime value monthly.
2. 29% of DTC startups use tiered pricing to capture varied customer segments
Meeting customers where they are
DTC startups often sell physical goods like skincare, supplements, or fashion. Tiered pricing works great here. Some customers are price-sensitive. Others want premium versions with extra features. Tiered pricing lets you serve both without creating separate products.
For example, a skincare startup might offer a basic face cream, a bundle with serum, and a luxury set with bonus tools. You’re not just selling products—you’re selling choices.
The psychology of pricing levels
Tiered pricing uses anchor pricing—showing a high-end option makes the mid-tier feel like a better deal. Customers feel they’re making a smart decision by avoiding the cheapest or most expensive option. That feeling of control can drive conversions.
Actionable takeaways
- Offer three clear tiers: entry, standard, and premium.
- Ensure each tier provides increasing value—not just higher prices.
- Highlight the most popular tier to guide user decisions.
3. 78% of SaaS companies with ARR over $1M offer usage-based pricing tiers
Usage-based pricing for scale
As SaaS companies grow, usage-based pricing becomes more common. Rather than charging a flat fee, you charge based on how much a customer uses—like API calls, number of contacts, or gigabytes stored. This model aligns your revenue with customer success. The more they use, the more they pay.
This is ideal for scaling because smaller customers can start cheap, and bigger customers can scale without hitting artificial ceilings. And it reduces friction during onboarding.
Aligning value with pricing
When customers pay based on usage, they feel like the pricing is fair. They’re in control. If they don’t use the tool much one month, they pay less. This fairness leads to higher retention, especially for power users.
Actionable takeaways
- Make sure usage metrics are easy to understand and predict.
- Use pricing calculators to help users estimate costs before committing.
- Monitor usage trends to adjust pricing thresholds over time.
4. Only 11% of DTC startups offer pay-as-you-go pricing
Why it’s rare—and when it works
Pay-as-you-go is flexible but risky for physical goods. Most DTC businesses have supply chain costs that don’t scale nicely with small, unpredictable purchases. That’s why only a small number offer this model.
But in niche markets—like refillable goods or on-demand custom items—it can work well. Customers who want flexibility and occasional use can be served without committing to a subscription.
Managing logistics
If you choose this model, you need airtight logistics. You’re dealing with varying order volumes, customer indecision, and inconsistent revenue. It’s hard—but not impossible—with a strong backend system.
Actionable takeaways
- Use this model only if your margins and supply chain can handle fluctuations.
- Combine it with upsells or bundles to increase average order value.
- Communicate clearly about shipping, timelines, and order minimums.
5. 46% of SaaS companies use freemium as a customer acquisition strategy
Lowering the barrier to entry
Freemium models give away core features for free, hoping users will upgrade later. It’s powerful for top-of-funnel growth. Users try the product risk-free and, if they find value, eventually convert.
Freemium works best when your product has a natural upgrade path. The free version shows users what’s possible, while the paid version unlocks the full experience.
The trap of free forever
Freemium isn’t easy. Many users never convert. That means your costs can grow faster than revenue if you’re not careful. You need to track the ratio of free to paid users closely and keep your infrastructure costs in check.
Actionable takeaways
- Put limits on usage or features in the free plan to create upgrade pressure.
- Offer in-app nudges and usage-based prompts to encourage upgrades.
- Analyze the behavior of users who convert vs. those who don’t—then optimize.
6. 37% of DTC startups use bundling to increase average order value
Why bundling works so well in DTC
DTC customers are often browsing with intent. If they find value in one product, they’re likely to consider complementary ones. Bundling taps into that mindset. By packaging related products together—like a shampoo, conditioner, and hair serum—you increase the total cart value while giving the buyer more perceived value.
It also reduces decision fatigue. Instead of comparing ten options, the customer sees one curated bundle that feels like a smart, convenient deal.
The power of perceived savings
Even a small discount across bundled items creates a strong incentive to buy. Customers feel like they’re getting more for less. Plus, it’s a great way to introduce new products or move slower inventory.
Actionable takeaways
- Bundle products that solve one complete need (e.g., a morning skincare routine).
- Use price anchoring by showing the total value vs. the bundled price.
- Test different bundle combinations and rotate offers to keep them fresh.
7. 22% of SaaS companies switch pricing models within their first 2 years
Why early pricing rarely sticks
Your first pricing model is a guess. It’s based on assumptions about your customers, their willingness to pay, and how they use your product. As you grow, you learn more—and what worked at launch often stops working later.
That’s why many SaaS startups change pricing within two years. Maybe you discover that most users don’t fit your tiers. Or your costs increase. Or usage patterns shift. Changing your model becomes a growth necessity.
Making the switch without losing users
Pricing changes are risky. Get it wrong, and you frustrate your users. But done right, it can boost revenue and reduce churn. The key is transparency. Tell users why you’re changing, what’s staying the same, and how it benefits them.
Actionable takeaways
- Interview paying and non-paying users to understand pricing friction.
- Use grandfathering for existing users to protect loyalty.
- Always A/B test new models before rolling them out broadly.
8. 41% of DTC startups adopt dynamic pricing based on demand and inventory
Adjusting prices in real-time
Dynamic pricing isn’t just for airlines or hotels. DTC startups are increasingly using it to balance demand, manage inventory, and respond to market conditions. Prices change based on supply, demand, seasonality, and customer behavior.
For example, a limited-edition item might increase in price as inventory runs low. Or prices may drop during slow seasons to stimulate demand.
The risk of over-automation
Dynamic pricing needs careful calibration. If users see frequent or unexplained price changes, trust erodes. Transparency and timing are critical. You want to seem responsive—not random.
Actionable takeaways
- Use it for time-sensitive items, flash sales, or overstock management.
- Combine dynamic pricing with email or SMS campaigns to create urgency.
- Monitor user behavior post-price-change to ensure satisfaction remains high.
9. 65% of SaaS startups under $500K ARR use flat-rate pricing
Simplicity wins in the early days
When you’re early and trying to validate your product, flat-rate pricing removes complexity. Users don’t have to think about tiers, usage, or features. One price. One product. It reduces friction and makes onboarding easy.
Flat-rate pricing also helps you focus. You’re not managing a complex pricing table—you’re focusing on building the product and growing your user base.
The limitations of flat pricing
As you scale, flat pricing can leave money on the table. Power users pay the same as light users. There’s no way to reward growth or scale revenue with usage. That’s when it becomes time to transition to a tiered or usage-based model.
Actionable takeaways
- Use flat pricing early to drive quick signups and gather product feedback.
- Limit this model to a time-bound growth phase.
- Be transparent when transitioning to a new model—explain the benefits clearly.
10. 53% of DTC brands use tiered discounts to drive repeat purchases
Rewarding loyalty without subscriptions
Not every DTC customer wants a subscription. Tiered discounts are a smart alternative. They reward larger orders or repeat purchases with increasing savings. For instance, a user might get 5% off on their second purchase and 10% on their third.
This builds a habit without locking users into a contract. It also increases lifetime value by encouraging customers to return.
Creating a smart discount ladder
The key is to keep your tiers close enough together to feel achievable. If it takes too many purchases to get to the next tier, customers give up. If tiers are well-structured, they feel like a game customers want to win.
Actionable takeaways
- Use customer data to personalize discount tiers.
- Highlight progress toward the next discount tier in post-purchase emails.
- Combine tiered discounts with product recommendations to boost AOV.
11. 17% of SaaS startups implement per-seat pricing in early-stage GTM
Making growth measurable
Per-seat pricing is simple: the more team members using the software, the higher the bill. This model makes sense for tools built for collaboration—project management, CRMs, customer support software. As teams grow, revenue naturally increases.
It’s also familiar. Businesses are used to paying per user for tools like Google Workspace or Zoom. That familiarity removes friction and makes buying decisions faster for managers.
Where it can go wrong
If your product doesn’t provide individual value to every seat, this model creates resistance. One active user and four passive users doesn’t feel fair to customers. It also discourages wider adoption inside companies when budgets are tight.
Actionable takeaways
- Ensure each seat provides independent value—logins, activity, results.
- Consider bundling minimum seats to avoid tiny contracts that don’t scale.
- Show team ROI in dashboards so managers see the value of adding users.
12. Only 9% of DTC startups adopt lifetime pricing offers
The rare but powerful up-front commitment
Lifetime pricing means customers pay once and get access forever. It’s not common in DTC because physical products usually have replenishment cycles. But for digital or hybrid DTC models—like eBooks, meal plans, or access to communities—it can work well.
Startups sometimes use lifetime pricing as a launch promotion. It brings in quick cash, attracts early adopters, and gives a strong reason to convert today.
Why most avoid it
Lifetime offers front-load all revenue. If you’re not managing customer service costs carefully, lifetime deals can lead to long-term losses. Also, you give up future revenue streams from recurring purchases.
Actionable takeaways
- Use lifetime deals selectively—for digital goods, not consumables.
- Clearly define the boundaries—what’s included, and what’s not.
- Frame it as an exclusive, time-limited reward for early adopters.
13. 84% of SaaS companies that use usage-based pricing report higher NRR
NRR: the metric that matters
Net Revenue Retention (NRR) shows how much revenue you retain from existing customers after accounting for churn, expansion, and downgrades. SaaS companies using usage-based pricing often outperform on this metric because revenue scales as customers succeed.
As usage increases—more queries, more data, more users—your billing naturally goes up. You’re not just retaining accounts, you’re expanding them.
A flywheel of growth
Customers see success, use more of the product, and pay more. That makes your growth more sustainable and customer-led. It also reduces the need to constantly chase new users.
Actionable takeaways
- Track usage metrics closely—build dashboards for customers and your team.
- Design pricing thresholds that encourage scaling, not discourage usage.
- Run regular NRR reviews to see where expansion is strongest—and why.
14. 26% of DTC companies use membership-based pricing for recurring revenue
Creating recurring value without subscriptions
Membership pricing is like a club. Customers pay monthly or yearly for access to exclusive products, perks, discounts, or early releases. It’s great for building community and long-term brand loyalty.
Unlike traditional subscriptions that deliver a product monthly, memberships offer access and status. That emotional layer is powerful—especially in lifestyle and wellness brands.
Why this is gaining traction
DTC brands are looking for stability. Memberships provide consistent income and predictable demand. Customers also tend to buy more often when they feel like insiders.
Actionable takeaways
- Build memberships around VIP perks, not just discounts.
- Highlight community access or early product drops as core benefits.
- Offer both monthly and yearly options—test conversion rates between them.
15. 33% of SaaS firms combine freemium with usage-based upsells
The hybrid that fuels viral growth
Combining freemium with usage-based pricing creates a powerful growth engine. Freemium gets users in the door. Usage-based pricing monetizes them as they scale. It’s a smart mix of easy entry and scalable value capture.
For example, email marketing software might allow 500 contacts for free. As a user grows to 5,000 contacts, they automatically move into paid plans. The pricing follows growth naturally.
Handling free vs. paid transition
You need a seamless transition from free to paid. If users feel surprised or limited, they might churn. Good communication and thoughtful thresholds are critical here.
Actionable takeaways
- Set usage thresholds just above typical early use to create natural upgrade points.
- Use product tours or onboarding to highlight what’s possible beyond the free tier.
- Segment your users and track conversion triggers—then refine based on data.
16. 12% of DTC startups use price anchoring as part of their sales funnel
Framing the right value
Price anchoring is a psychological strategy. You show a high-priced option first to make your regular offer feel like a deal. It works because buyers compare prices against what they just saw—not against objective value.
For example, a DTC brand might display a $150 deluxe set next to a $90 standard bundle. The $90 bundle suddenly feels affordable, even if it’s more than the customer intended to spend.
Why only some use it
It requires multiple well-defined tiers. For brands with just one or two products, anchoring has limited effect. But if you have a range—basic, standard, premium—anchoring helps guide the buyer toward your ideal offer.
Actionable takeaways
- Place the highest-priced product first to set the anchor.
- Visually highlight the mid-tier option as “most popular” to guide choice.
- Test different anchor points and monitor conversion lift by version.
17. SaaS companies using hybrid pricing grow 24% faster on average
Best of both worlds
Hybrid pricing blends multiple models—like per-seat plus usage-based or subscription plus add-ons. It allows startups to monetize both access and scale. This flexibility attracts a broader customer base and adapts to different usage levels.
For example, a team collaboration tool might charge per seat, but also offer usage-based billing for extra storage or integrations.
Complexity brings reward
Yes, it’s more complex to manage. But done right, it drives higher ARPU and lower churn. Customers start small, pay more as they grow, and feel they’re paying fairly.
Actionable takeaways
- Start with two pricing layers—base access and scalable usage.
- Use real user data to set usage thresholds that feel logical.
- Train your sales and support teams to explain the model clearly.
18. DTC startups with personalized pricing see a 19% increase in LTV
One size doesn’t fit all
Personalized pricing means offering different prices, discounts, or bundles based on user behavior, location, purchase history, or lifecycle stage. It makes customers feel understood—and they respond by spending more and staying longer.
Some brands use quizzes or account creation flows to determine the best product and price. Others use browsing or cart data to serve targeted offers.
Getting it right
Done wrong, it feels unfair. Customers might discover others paid less. So personalization should be subtle and data-driven—focused on delivering the right value to the right user at the right time.
Actionable takeaways
- Use on-site behavior or quizzes to segment customers and deliver dynamic offers.
- Reward loyal users or repeat customers with tailored promotions.
- A/B test personalized offers versus broad discounts to measure impact.
19. Only 6% of SaaS startups use outcome-based pricing models
Charging for results, not access
Outcome-based pricing means customers pay when they get a result—like revenue generated, leads closed, or savings delivered. It’s bold, risky, and rare. But for the right product, it can be a powerful differentiator.
Startups offering marketing automation, hiring tools, or analytics often experiment with this model. But it requires trust, tracking, and alignment.
The challenge
Most startups avoid it because it’s hard to measure outcomes cleanly. Attribution is messy. Plus, you delay revenue while delivering value upfront.
Actionable takeaways
- Use outcome-based pricing only if your product delivers trackable ROI.
- Offer it as a performance-based alternative for larger deals or pilots.
- Build reporting features that prove the outcomes you promise.
20. 43% of DTC brands rely on discount-heavy strategies early in their lifecycle
The quick path to traction
Discounting helps DTC brands get initial traction. When you’re new, you need to get noticed, win first-time buyers, and move inventory. Launch discounts, first-purchase offers, and limited-time sales create urgency and reduce hesitation.
In the short term, discounts work. But over time, they can train customers to wait for deals instead of buying at full price.
Building beyond the discount
Discounts are not a long-term strategy. You need to layer in brand value, product differentiation, and customer experience. Otherwise, your margins suffer, and loyalty remains shallow.
Actionable takeaways
- Use early discounts strategically, not constantly.
- Introduce a loyalty or referral program to retain customers after the first purchase.
- Gradually shift messaging from savings to quality, community, or product benefits.
21. 67% of SaaS companies that revise pricing annually report improved ARR
Pricing is not a set-it-and-forget-it play
Your product evolves, markets shift, competitors change direction—so why would pricing stay the same? The best SaaS startups treat pricing like a product. They revisit it, test it, and refine it based on real data.
Startups that revisit pricing at least once a year often uncover opportunities for more revenue. Maybe a tier is underpriced. Maybe users want more flexibility. Or maybe new features justify an increase.
Why it drives ARR
Annual pricing reviews help companies keep up with value delivery. If you’ve added major features, increased support, or improved onboarding, customers will often accept a higher price—if the increase is framed around added value.
Actionable takeaways
- Conduct an annual pricing audit. Review revenue by tier, upgrade paths, and churn points.
- Gather customer feedback on perceived value vs. actual cost.
- Roll out changes gradually. Offer legacy pricing for existing customers while testing the new structure with new ones.
22. 35% of DTC startups test three or more pricing structures in the first year
Speed over perfection
DTC founders know this: you rarely get pricing right the first time. Consumer behavior is unpredictable, and competition is fierce. Testing different price points, bundles, and delivery models early helps you dial in the sweet spot.
Some brands start premium, then test a value tier. Others begin with flat pricing and later try tiered bundles or build-your-own kits.
What testing reveals
You learn where conversion drops. You find which price increases AOV and where customers abandon. You understand how much psychological resistance exists at each price level.
Actionable takeaways
- Use short testing windows—7 to 14 days—to compare versions.
- Don’t just test prices. Test product combinations, shipping thresholds, and offers too.
- Make one change at a time. Don’t mix multiple variables or you won’t know what caused the lift or drop.
23. SaaS companies with transparent pricing convert 18% better on landing pages
Clarity builds trust
When visitors see pricing upfront—without needing to book a call or dig through FAQ pages—they feel in control. That control leads to higher trust, better engagement, and faster conversion.
Even in enterprise SaaS, where deals often involve negotiation, showing a pricing range or example packages works better than hiding everything behind a demo form.
The myth of hiding prices
Some founders worry that public pricing gives competitors an advantage. But users don’t care about your competitor’s reaction—they care about making an informed decision. Hiding pricing frustrates them.
Actionable takeaways
- Show your pricing clearly. Use simple words, clean layouts, and real examples.
- Include what’s included in each tier, but avoid jargon.
- Add a calculator for usage-based or hybrid models to reduce uncertainty.
24. DTC startups offering installment pricing increase conversion by 21%
Breaking price friction
High-ticket DTC items—like mattresses, fitness gear, or luxury skincare—often face one key objection: price. Installment pricing solves that. Letting buyers split payments over three or four months lowers that up-front barrier.
Buy now, pay later (BNPL) services like Klarna, Afterpay, and Affirm make it easy to offer this with minimal risk to the brand. You get paid upfront, they handle the collections.
Why it works
It’s psychological. $200 might feel like a lot. But four payments of $50 feels doable—even though it’s the same. For first-time customers, it also feels safer. They haven’t committed everything at once.
Actionable takeaways
- Offer installments at checkout for products over a certain threshold—typically $100+.
- Make the installment option visible before the final step—on product pages or banners.
- Monitor return rates. While installment customers convert more, some may churn faster if expectations aren’t met.
25. 48% of SaaS firms use pricing as a core competitive differentiator
When your pricing is part of your positioning
In crowded SaaS markets, pricing isn’t just a transaction—it’s part of the message. Are you the affordable choice? The premium experience? The scale-with-you platform? Your pricing should reflect and reinforce that identity.
Companies use pricing to stand out. One startup may offer unlimited usage at a flat rate. Another might offer enterprise features at SMB prices. A third may bundle in white-glove onboarding.
Why this matters
Buyers compare you to competitors. If your pricing model is easier to understand, easier to scale with, or feels fairer, that can tip the decision in your favor—even if your product isn’t the most feature-rich.
Actionable takeaways
- Map your pricing strategy to your core positioning—cost leader, value provider, or premium partner.
- Use your pricing page to tell a story about value, not just cost.
- Regularly review competitor pricing, but don’t copy—differentiate with intent.
26. 31% of DTC founders cite pricing complexity as a top challenge
Pricing shouldn’t confuse the customer—or the team
DTC brands often start with simple ideas but end up with complex pricing because they’re trying to do too much. Multiple bundles, overlapping promotions, loyalty discounts, seasonal offers—it can all become a mess. Worse, it confuses buyers and overwhelms teams managing logistics and marketing.
When pricing becomes hard to understand, conversion drops. Customers bounce. Support tickets rise. And internally, marketing and operations start to struggle to align.
Simplicity sells
Even if your back-end is complex, the front-end offer needs to be simple. Pricing should feel clear and easy for customers. They should know what they’re getting, what it costs, and what to expect next.
Actionable takeaways
- Use plain language and round numbers in pricing. Avoid too many asterisks or footnotes.
- Test your pricing page with new users. Ask them what they think is included. If they’re confused, it’s not ready.
- Internally document all pricing rules in one place—make sure marketing, customer support, and fulfillment are aligned.
27. SaaS startups using value-based pricing report 1.5x higher CAC efficiency
Pricing to match customer outcomes
Value-based pricing means setting your prices based on how much your product helps the customer, not how much it costs you to deliver. It’s harder to calculate—but far more profitable.
Companies using this model tend to attract better-fit customers who are willing to pay for the actual result. And when your price matches perceived value, customers are more likely to convert and stay.
Why CAC improves
Customer acquisition cost (CAC) drops when customers feel the price makes sense. You don’t have to over-educate them. You don’t need as many discounts or incentives. The value is obvious, so the decision is faster.
Actionable takeaways
- Interview your best customers and ask how they describe the value they get from your product.
- Use this language in your messaging and pricing structure.
- Build case studies or ROI calculators that tie price directly to outcome.
28. 39% of DTC brands A/B test price points monthly or more frequently
Always be testing
Pricing isn’t static—it’s dynamic. DTC brands that test prices regularly are learning what works, what doesn’t, and how customer behavior shifts with the seasons, economic trends, and product cycles.
A/B testing price points monthly gives you insight into elasticity—how sensitive your customers are to changes. It also helps you find the ideal balance between volume and profit.
How to do it without hurting trust
Testing prices doesn’t mean showing two completely different prices to the same user base in a way that feels unfair. Smart brands localize tests by geography, channel, or customer segment. They track results quietly, then roll out the best-performing structure.
Actionable takeaways
- Run pricing tests on landing pages with targeted traffic—not your entire website.
- Keep a pricing test calendar so you avoid overlapping experiments.
- Measure more than conversion—track AOV, repeat rate, and support load too.
29. SaaS companies using seat + usage hybrid pricing see 2x upsell revenue
Combining two levers for better scale
Some SaaS tools serve both individuals and teams—think project managers, CRMs, or cloud storage. For them, seat-based pricing handles access, while usage-based pricing scales with actual activity. Together, this creates a powerful upsell engine.
Customers start with a few seats. Then they use more bandwidth, integrations, or data—and suddenly they’re paying more without hitting a blocker. That seamless upsell is where the model shines.
What to watch for
Hybrid models can confuse if not clearly explained. Users should know exactly when and why their price goes up. Transparency is key, or you risk surprise and churn.
Actionable takeaways
- Visualize pricing tiers with examples. Show what a 5-seat, 10K-API-call plan looks like.
- Give account managers tools to monitor usage trends and flag upsell moments.
- Make sure billing reflects real usage, with monthly reporting that builds trust.
30. DTC brands with subscription pricing retain customers 3.2x longer
The long game
Subscriptions create habit. When customers receive something regularly—whether it’s coffee, skincare, or protein powder—they build it into their routine. That habit increases retention and lifetime value dramatically.
This is why subscription-first DTC brands, like Dollar Shave Club or HelloFresh, grow so fast. Customers don’t just buy—they stay.
Building retention into the model
It’s not just about delivery. The experience needs to feel valuable month after month. That includes personalized recommendations, flexible skip options, and engaging unboxing moments.
Actionable takeaways
- Offer both monthly and quarterly plans, with discounts for longer commitments.
- Let users pause or skip easily. Flexibility increases retention, not churn.
- Surprise subscribers with occasional bonuses, notes, or samples. It keeps the experience fresh.
Conclusion
The way you price your product isn’t just about covering costs—it’s about shaping customer perception, creating long-term value, and driving sustainable growth. Whether you’re a SaaS founder testing usage-based tiers or a DTC brand experimenting with subscriptions and bundles, the key is staying flexible, data-driven, and customer-focused.
