PRICING MODELS

1. Freemium Pricing

• This pricing model allows users to have access to certain features while offering the option for an upgrade.
• This pricing model allows access to certain features or for a limited period of time while encouraging users to buy the paid plan for additional features.
• This pricing model has been used for several years. 

Advantages

• The psychology here is that users get to interact with a product immediately.
• The adoption hurdle is easier to navigate when users have immediate access without any financial commitments.
• If any issues are identified, it would be easier to revise and re-market. 

Disadvantages

• This model is not ideal for making a profit and the company's revenue may be hit hard for a while.
• There is a risk that once the free period is over, users may simply discard it, increasing the churn rate. 

 Companies that offered freemium pricing successfully

•  Hootsuite, Echosign, and Trello.

OTHER PRICING MODELS

• This is one of the most popularly used models whereby the pricing is per user.
•  Salesforce is one of the companies that uses this model.

• In this model, subscribers are charged for each active user. 
•  Slack uses this pricing model.

• This is a pricing model that charges a flat rate fee regardless of the number of users.
•  Buffer uses this pricing model. It offers three plans: pro, premium, and business.

• In this structure, the user is charged a dynamic fee depending on the features selected.
•  Leadpages uses this pricing model.