Tiered Pricing
Tiered pricing is a business and software strategy where products or services are offered at multiple price levels, each with different features, usage limits, or support levels. It is commonly used in SaaS (Software as a Service), cloud platforms, and subscription-based models to cater to diverse customer segments, from individuals to enterprises. This approach helps maximize revenue by appealing to various budgets and needs while encouraging upgrades as users' requirements grow.
Developers should learn tiered pricing when building or integrating monetization strategies for software products, especially in B2B or subscription contexts. It is crucial for designing scalable pricing models in SaaS applications, API services, or cloud infrastructure, where it helps segment customers (e.g., free, basic, premium tiers) and optimize conversion rates. Understanding this concept aids in implementing features like usage-based billing, feature gating, and analytics to track tier performance.