Each type of product might have different pricing schemes that work well. For example, if the product is fresh apples, pricing schemes might be “price per apple” or “price per kilogram” or “price per basket”, but if the product is legal services the pricing schemes might be “price per hour”, “price per deliverable”, or “monthly retainer”.
We will cover some typical pricing schemes here, but this is not an exhaustive list — there could be other pricing schemes and other product types that we didn’t cover. Please contact us with suggestions to add more variety here!
Memberships
Subscription. Charge a flat fee each month for continued membership. This is useful when membership grants access to resources or invitation to events, which don’t cost a significant amount for each additional user who participates.
Lifetime. Charge a one-time fee for lifetime membership. This should come with a disclaimer that if the business shuts down, the membership will be voided.
Downloads
Flat fee. Charge a one-time amount for the download.
Per download. Charge an amount for each download and send an invoice at the end of the month, or charge in advance for a limited number of downloads. Note that if you charge the amount each time the download is requested, that’s flat fee pricing.
Software as a service
Flat fee. Charge the same amount each month for use of the software. This can also be used to charge for maintenance or limited support.
Per user. Charge an amount each month for each additional user. This can also be combined with tiered or volume pricing to give discounts for additional users.
Per usage. Charge an amount each month for resources used such as computing power, memory, storage, and data transfer. This can be combined with per-user pricing. It can also be combined with tiered or volume pricing to give discounts for additional usage.
Tiered pricing. As more users are added, the amount charged for each additional user may change (typically decreases). For example the first 5 users may be included in the plan, and the next 5 users cost $10/user/mo, and the next 5 users cost $8/user/mo, etc.
Volume pricing. As more users or resources are added, the per item price changes for the entire quantity. For example up to 5 users it’s $12/user/mo, but 6-10 users it’s $10/user/mo for the entire quantity (not just for the 6th and later users).
Coaching
Hourly pricing. Charge for each session according to its length. There could be different hourly rates for 30 minute, 45 minute, 60 minute, or 90 minute sessions. This doesn’t mean you need to take payment each time a client attends a session. You could keep their credit card information on file and simply charge them for each session. At the end of each session you just need to schedule the next one.
Package pricing. Put together a package of coaching services. It might include a number of sessions and it might also include other activities or services in addition to the sessions. Charge in advance and then serve the client.
Value-based pricing. This is for situations where the client can place a monetary value on achieving goals (easiest when the goals themselves relate to money, but can also be done for other goals), and the client is willing to pay for coaching based on the value of the goals. In this situation, the coaching skills might be more of a specialty that’s harder to find, which is why the coaches who can do it can also charge more for it. Coaches who use value-based pricing might charge the larger value-based amount up front, or charge it in installments. Another option is to charge hourly or package while working on the goal, and then charge the value-based amount as a bonus when the goal is achieved.
Subscription. This is like package pricing but it’s charged each month, each quarter, or each year on a recurring basis until the client cancels it. The subscription might include a number of sessions and possibly other services, like package pricing. An incentive to buy a subscription instead of a sequence of packages might be membership in an exclusive community, invitation to special events, or other perks that give more value or more access to the best coaches or help people to network with other people who can help them.
Monthly retainers. This is like a combination of package pricing and hourly pricing, where a larger amount is paid up front, but then as sessions happen they are deducted from the retainer. Send an invoice to the client at the end of the month with the amount deducted from the retainer, and the client will then pay that amount to top up the retainer. This is probably the least useful method because it’s more overhead for the coaching service and for the client, compared to simply and automatically paying hourly for sessions with a credit card that’s already on file.