SaaS Talk™ with the Metrics Brothers is hosted by Dave "CAC" Kellogg and Ray "Growth" Rike. SaaS Talk™ provides unique insights, strategies, tactics and the metrics to measure customer acquisition, customer retention and customer expansion success for B2B SaaS companies.
Each 20-minute episode will cover a topic critical to profitable revenue growth chalked full of practical advice that can be introduced and applied in most B2B SaaS companies.
On this episode, Dave "CAC" Kellogg and Ray "Growth" Rike discuss in detail how Usage-Based Pricing (UBP) impacts the calculation of Customer Acquisition Cost and it's efficiency derivatives including CAC Ratio and CAC Payback Period.
They discuss the three primary different types of Usage-Based Pricing Models including:
- Pure usage-based or consumption-based pricing with no minimum commitments
- Minimum commitment agreement that includes up to #x units and then overage $/unit over the minimum
- Annual Subscription agreement to the platform and a $/unit of usage in addition to the annual subscription
Each of the above models can impact what is consider Annual Recurring Revenue (ARR), Variable Recurrring Revenue (VRR) and/or pure variable revenue - and that will accordingly impact the CAC efficiency metric calculation methodology.
If you love the nuances and details of SaaS Metric and how emerging GTM models impact traditional metrics calculations - this episode is for you!
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