Tiered pricing examples for SaaS growth in 2025

SaaS pricing models are evolving fast, and finding the right strategy is key for growth in 2025. Tiered pricing has become increasingly popular in the SaaS industry. Research indicates that the average SaaS company offers around 3.5 pricing tiers to cater to various user segments. 

This post explores tiered pricing examples and best practices to help you unlock your SaaS growth in 2025.

In this article, you'll learn:

• What tiered pricing is, and why it's so flexible
• The different types of tiered pricing models for SaaS businesses
• How SaaS companies use tiered pricing to drive growth
• Steps to create an effective tiered pricing strategy for your SaaS company

But what is tiered pricing and what are some tiered pricing examples? Let’s get started with an explanation.

What is tiered pricing?

Tiered pricing is a pricing strategy where firms offer products or services at various price points based on criteria like quantity, features, usage, or service level. 

This approach creates distinct tiers, generally offering greater value or lower costs as customers move to higher tiers. It differs from other models. For instance, flat-rate pricing charges a single price regardless of usage. Usage-based pricing, conversely, ties cost directly to consumption.

Tired pricing and why it’s considered so flexible

A key advantage of tiered pricing is its adaptability. It addresses the varying needs and budgets of different customer segments. That’s why it’s so popular among SaaS businesses, where scalability and user segmentation are critical. 

SaaS companies often serve a wide range of users, from small startups to large enterprises, each with unique needs. Tiered pricing allows SaaS firms to tailor their offerings, providing basic plans for budget-conscious users and premium plans with advanced features for larger clients. 

This targeted strategy helps attract a wider customer base and encourages upgrades as businesses grow.

Types of tiered pricing models

Here's a breakdown of some typical structures, with examples to show their application in a SaaS business. 

Feature-based tiers

Feature-based tiers structure pricing around the availability of features. Basic tiers offer essential functionality, while higher tiers unlock more advanced capabilities. 

Feature-based tiers allow businesses to cater to different customer segments, from startups needing core tools to enterprises requiring full suites.  

• Example: A project management software company might offer a "Basic" tier with task management and collaboration tools, a "Pro" tier adding Gantt charts and reporting, and an "Enterprise" tier with advanced analytics and integrations. 

Usage-based tiers

Usage-based tiers tie pricing to consumption levels. Costs increase as usage grows. This model is common for services like API calls, data storage, or processing power. It aligns cost with value, making it attractive to both customers and providers.  

• Example: A cloud storage provider could charge based on the amount of data stored. A "Basic" tier might offer a certain amount of free storage, with subsequent tiers charging per gigabyte used. 

User-based tiers

User-based tiers adjust pricing based on the number of users or licenses. They are prevalent in collaborative software or platforms where access is granted per person. This model is straightforward and easy for customers to understand.  

• Example: A customer service platform might offer tiered pricing based on the number of agents. A "Small Business" tier could support a limited number of agents, while an "Enterprise" tier accommodates larger teams. 

3 hypothetical tiered-pricing examples: How SaaS companies drive growth

We’ll now share three tiered-pricing examples showcasing how SaaS companies can leverage different models and Orb’s flexible usage-based billing platform to fuel growth. Let’s zoom in.

Example 1: Feature-based tiered pricing for SaaS analytics tools

A SaaS analytics platform uses Orb to create three feature-based tiers:

• Basic: Core analytics dashboards, limited data storage, and standard reports.
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• Pro: Advanced analytics, expanded data storage, custom reports, and API access.
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• Enterprise: All features, unlimited data storage, dedicated support, and custom integrations.

How Orb helps

• Orb's platform lets the company easily define and manage feature-based tiers. They can configure the specific features available within each tier directly in Orb without requiring code changes.
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• The company can adjust feature sets within each tier based on market feedback. Orb's flexible system allows for real-time updates to pricing tiers, facilitating rapid responses to customer needs and competitive pressures.
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• Orb's accurate billing confirms customers are charged correctly based on their chosen tier. By tracking feature usage and tying it to the appropriate tier, Orb automates the billing process, eliminating manual intervention and reducing errors.
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• Real-time usage dashboards provide the analytics company with insights into feature adoption across different tiers. This data allows them to understand how customers are using the platform and spot opportunities for upselling or feature improvements.
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• Orb's reporting tools offer a detailed analysis of each tier's performance, informing future pricing decisions. The company can track key metrics like revenue, churn, and customer acquisition cost for each tier, enabling data-driven pricing adjustments.

Hypothetical Result: An estimated 25% of Basic users converted to the Pro tier within six months, driven by the need for advanced analytics and API access.

Example 2: Usage-based tiered pricing for SaaS infrastructure

A cloud infrastructure company adopts Orb to manage a usage-based tiered pricing model:

• Starter: Limited compute resources, and basic support.
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• Growth: Increased compute resources, enhanced support, and advanced monitoring.
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• Enterprise: Dedicated resources, premium support, and custom service level agreements (SLAs).

How Orb helps

• Orb's raw event architecture accurately tracks resource consumption for each customer. Orb collects granular usage data, ensuring precise measurement of compute resources, storage, and other relevant metrics.
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• The company can easily define pricing tiers based on usage thresholds. Orb allows for the configuration of tiered pricing structures that automatically adjust based on customer consumption.
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• Orb automates billing based on actual usage, guaranteeing transparency and accuracy. The platform generates invoices that clearly reflect usage, fostering trust with customers.
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• Real-time usage alerts notify the company of customers approaching tier limits. This Orb advantage enables proactive engagement with customers, potentially leading to upsell opportunities as well.
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• Orb's integrations with a myriad of payment gateways simplify the billing process. Automated payment collection reduces administrative overhead and improves cash flow.

Hypothetical Result: Customers seamlessly upgrade as their usage grows, increasing customer lifetime value (CLV) by 15%.

Example 3: User-based tiered pricing for CRM software

A SaaS CRM provider partners with Orb to scale user-based pricing:

• Startup: 5 users, and essential CRM features.
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• Team: 20 users, expanded features, and sales automation.
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• Enterprise: 50+ users, all features, custom integrations, and dedicated support.

How Orb helps

• Orb simplifies the management of user-based pricing tiers. The platform provides a centralized interface for managing user counts and assigning them to the appropriate tiers.
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• Orb automates billing adjustments based on user count. The CRM provider can easily add or remove users within each tier, and Orb automatically calculates and applies the correct charges based on the updated user counts.
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• Orb's reporting tools provide insights into user growth and churn within each tier. This data helps the CRM provider understand customer behavior and optimize their pricing strategy.
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• Orb's accurate invoicing reduces billing disputes. By providing transparent and detailed invoices, Orb minimizes confusion and improves customer satisfaction.

Hypothetical Result: Reduction in billing disputes by 20%, improving customer satisfaction.

Why do SaaS companies use a tiered pricing strategy? 

Tiered pricing aligns well with the specific needs and goals of SaaS businesses. Several key reasons drive its popularity.

Attracting different customer segments

SaaS companies often target a broad range of customers, from small startups to large enterprises. Tiered pricing allows these companies to attract these different customer segments by offering plans tailored to each group's needs and budgets. 

Startups might opt for a basic, low-cost tier, while enterprises might choose a premium tier with advanced features and support.  

Monetizing extra features

As SaaS products evolve, new features come with this evolution. Tiered pricing provides a mechanism to monetize these additions. 

Higher tiers can include access to these advanced capabilities, enticing customers to upgrade and increasing revenue per user. SaaS companies can capture more value from their higher-value customers.  

Offering cost-effective options

Tiered pricing allows SaaS companies to offer cost-effective entry-level options, making their products accessible to a wider audience. This element can be a crucial factor in acquiring early adopters and building a customer base.

Reducing churn

Tiered pricing can help reduce churn by providing users with the right level of service at the right price. If a customer's needs change or their budget tightens, they can downgrade to a lower tier instead of canceling their subscription altogether. 

Scaling with customers

Tiered pricing allows SaaS products to scale easily. Customers can upgrade to higher tiers as they need more features, capacity, or support. This scalability fosters long-term relationships and increases CLV. 

By accommodating growth, tiered pricing helps SaaS companies maximize their revenue potential from each customer. 

Consider tiered pricing examples like those from the previous section. A business might start with a basic plan and upgrade as their team expands or their need for advanced features increases.

How to create a tiered pricing structure for your SaaS organization

Designing an effective tiered pricing model for your products involves some key steps:

1. Pinpoint your customer segments: Analyze your target audience and group them into distinct segments based on their needs, budgets, and willingness to pay. This might include startups, small businesses, and large enterprises.
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2. Define value metrics: Choose the metrics that best align with your product's value proposition. These metrics will form the basis for your pricing tiers. Common value metrics include the number of users, features, usage levels, or storage capacity. 
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3. Establish tiers: Aim for a balance between simplicity and flexibility. A three-tiered approach (e.g., Basic, Pro, Enterprise) is a popular starting point, but you can adjust the number of tiers based on your product and target market. 
   
   Clearly define the features, limits, and pricing for each tier, ensuring a clear value progression as customers move to higher tiers.

4. Test and optimize: Pricing is not a one-time decision. Use A/B testing and gather customer feedback to continually refine your pricing and packaging strategy. 
   
   Experiment with different pricing points, feature sets, and tier structures to find the optimal model for your business. Monitor key metrics like conversion rates, churn, and average revenue per user (ARPU) to assess the effectiveness of your pricing changes.

Best practices for implementing tiered pricing

Tiered pricing can be a powerful growth lever for SaaS companies, but its effectiveness depends on careful implementation. Here are some best practices to guide your strategy:

• Clear tier differentiation: Minimize confusion by clearly differentiating your pricing tiers. Each tier should have a distinct set of features, limits, and pricing, making it easy for customers to understand the value proposition at each level. 
  
  Avoid overlaps or ambiguities that might make it difficult for customers to choose the right tier.

• Free or low-cost entry-level tier: Offer a free or low-cost entry-level tier to attract new users and reduce the barrier to entry. This allows potential customers to experience your product's value before committing to a paid plan. 
  
  The entry-level tier should provide must-have features and encourage users to upgrade as their needs grow.

• Value-driven upselling: Focus on value-driven upselling for higher tiers. Communicate the extra benefits and value that customers will get by upgrading. Highlight the advanced features, more capacity, or premium support that justifies the higher price point.
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• Regular evaluation and adjustment: The SaaS market is dynamic, so your pricing strategy should be too. Regularly evaluate and adjust your pricing tiers based on market trends, competitive pressures, and customer feedback.

FAQs

Can I combine tiered pricing with other models?

Yes, you can blend tiered pricing with other models like volume or usage-based pricing. For instance, offer tiered plans with per-user pricing that also include volume discounts for larger teams.

How do I test a tiered pricing model?

A/B testing is your friend. Experiment with different pricing points, features within each tier, or even the number of tiers offered. Gather customer feedback and analyze key metrics like conversion rates and ARPU to optimize your model.

What’s the best tiered pricing structure for a SaaS enterprise?

A common approach is a three-tiered structure (e.g., Basic, Pro, Enterprise) that caters to different customer segments and offers a clear value progression. It's always best to analyze tiered pricing examples relevant to your industry and experiment to find what works best for you.

How Orb makes tiered pricing implementation a breeze 

We've explored tiered pricing examples and how they can unlock SaaS growth. Now, imagine having the power to implement and adapt your pricing strategies with ease, without the limitations of rigid billing systems.

Orb makes this possible. Orb is more than just a billing solution; it's a dynamic, data-driven monetization engine that evolves with modern SaaS and GenAI companies. Use Orb to unlock your usage data, facilitating flexible pricing, easier billing, and faster growth — without the constraints of rigid billing systems.

Here's how Orb helps you break free from static billing and fuel your growth:

• Adapt with agility: Orb decouples usage data from pricing metrics, allowing you to experiment with pricing, adapt to change, and fine-tune your monetization strategy without limitations. 
  
  Quickly test new pricing models, iterate on existing ones, and roll out updates with Orb RevGraph and Orb SQL Editor.

• Bill with precision: Orb RevGraph ingests all your raw event data, providing accurate, error-free billing. Deliver precise invoices, build customer trust, and prevent revenue leakage with granular, auditable billing calculations.
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• Confidently scale: Orb's extensible architecture grows with your needs. Get high-scale data ingestion with the Orb API, query your data with the Orb SQL Editor, and leverage built-in functions like billing, invoicing, and reporting — all built on top of your usage data.
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• Partner with experts: Orb is a trusted guide, offering dedicated implementation support, industry expertise, and ongoing improvements to guarantee your success with usage-based pricing.

Ready to move from rigid, static billing to a dynamic, data-driven billing engine? Try Orb today and experience the future of billing. Check our flexible pricing tiers and find one that fits your needs.