Pricing models are shifting, is your CS strategy?

December 11, 2024

Hello from the CLT airport in what should be my last trip of the year (for work at least…). There’s something about traveling for work that gets you focused and locked-in — it’s like a forcing function to eliminate procrastination.

This week, here’s what we got:

  • The evolution of pricing models in enterprise software
  • Using AI to help you pressure-test your org design
  • Simple customer engagement journey

ARTICLE

Pricing models are shifting, Is your CS strategy?

I stopped when I saw this graphic from Jacco van der Kooij, the Founder of Winning by Design. He’s got a knack for taking the complicated and distilling it down - so here’s how he imagined the shift in enterprise software pricing models.

The way we pay for software has evolved:

  • Ownership: Big upfront costs, perpetual licenses, and on-prem maintenance. Clunky, rigid, outdated.
  • Subscription: SaaS made software more accessible with recurring fees and cloud hosting. But it locks you into fixed costs, even for unused features.
  • Consumption: Pay for what you use. Fully flexible, outcome-driven, and aligned with value. Think AWS or Snowflake.

The shift? As consumption models take over, Customer Success teams will transform from renewals-focused to usage and outcomes-focused. Instead of ensuring customers stick, CS will focus on ensuring customers use. Think proactive engagement, real-time usage insights, and tighter alignment with revenue teams.

My take: CS teams that can drive usage, tie their efforts to measurable outcomes, and build deeper partnerships will thrive in the consumption era. Those clinging to old retention playbooks will get left behind.

IMPLEMENTING AI INTO YOUR BUSINESS

Is your team clearly defined?

Teams can become messy, especially as you grow and scale. What once was clearly defined becomes a gray area, and oftentimes, that leads to missed expectations with your teams.

So, here’s a way you could use AI to help you ensure your team is clearly defined and set up for success:

Prompt:

"I want to design a Talent Calibration Framework to evaluate my team’s structure and ensure the right people are in the right roles. The goal is to assess role alignment, team strengths, gaps, and how well the team is positioned to meet organizational goals.

Provide a framework to review the team holistically, with steps for evaluating:

  1. Role Clarity: Are roles clearly defined with measurable goals and aligned to business priorities?
  2. Skill Alignment: Does the team collectively have the skills required to achieve current and future objectives?
  3. Performance Distribution: Are high performers, steady contributors, and underperformers balanced appropriately?
  4. Scalability: Is the structure built to scale with business growth?
  5. Team Dynamics: Are there collaboration issues, cultural misalignments, or workload imbalances?

Deliver the framework as a structured approach I can apply quarterly or annually, with specific steps and key questions to ask during the review. Recommend tools or best practices to make this process actionable."

FRAMEWORK

Simple digital journey flow

Complexity kills momentum. Customer engagement programs and simple, repeatable funnels work best.

Start with a clear goal: driving reviews, increasing product usage, or improving retention. Then, create a lightweight 3-step funnel:

  1. Capture Attention: A well-timed email or in-app notification.
  2. Drive Action: Make the next step irresistible with a single, clear call to action.
  3. Deliver Value: Show customers immediate impact, whether it’s a thank-you, a reward, or insights.

The key? Iterate quickly, track results, and keep friction low. Sometimes, the simplest systems are the most effective.

We’re grateful you choose to read each week.

When you’re ready for more, there are a couple ways we can help:

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