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  • Writer's pictureNikhil Kotcharlakota

Does tracking feature usage result in Usage-Based Pricing?

Updated: Oct 18, 2023

Usage-based Pricing (UBP) has been getting a lot of attention lately and for good reason.

However Usage-based pricing is not for everyone.

It does help when you charge your customers based on their usage but it has its complications such as revenue predictions can get difficult and customers will find it difficult to predict their costs.

This doesn’t mean you stop tracking usage, but tracking usage doesn't always have to result in Usage-based pricing, it could help you package your plans better and create a good upsell path for your customers.

Loom just announced "small" change, they are putting "video download" behind a paywall. A very important feature, I have used it multiple times in the free version. By tracking usage of customers they probably realized this is an important benefit and they can use this to upsell customers to a paid plan.

This shows the impact packaging can have on revenue. Loom will likely achieve a revenue increase without actually doing a price increase and this will result in better NDR as well. They might see some logo or customer churn, but should definitely result in revenue growth.



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