Per-project VS Per-user pricing. Why you should pick the first.
When it comes to team planning app for agencies.. here is why the “pay per user subscription model” is always better for the company providing it … but NOT for their customers!.
Efficient agencies use Saas-based team planning service to assign their resources/consultants on the many different projects running in parallel.
A typical app contains a visual planner board to smartly assist the project manager officer or planning teams to allocate their staff on the projects. Plus, it provides tools to automatically sync the consultants’ calendar so as to reflect the planning.
Such apps are really adding value as they ensure an optimal utilization of the talents and avoid downtime of these key resources.
The team planning apps are a niche industry… and it seems that all its members – but Teambook – have decided that the “per user” pricing model is the right one… for them at least!
The per user pricing is a SaaS pricing model that charges a subscriber for each user of its product. For example, some apps charge $4.99 per user, per month. In the case of agencies, a “user” could be either a team planner, a manager, a consultant, a freelance contractor… etc.. It is pretty easy to track the number of “users” as each of them needs to interact with the apps, may it be to plan fellow resources, to view their utilization report, or to inform them about their upcoming schedule.
The per user user pricing model is straightforward and simple to understand: an agency with 20 users will pay 20 (= number of users) * price per user; if three months later, this business hires 1 more consultant and uses another contractor, then it will pay 22 * price per user.
Easy to understand, simple… sounds great…. But is there some small print?!
From the app point of view.. it is a great model! Basically, unless their customers start to fire their workforce.. money will flow in and somehow automatically increase over time!
Now.. here come the downsides of such a model for the customer, ie the agencies; ie you?
Customers tend to pay more than needed as no regular clean up of the resources database is ever done.. especially for the subcontractors that may be employed from time to time. Furthermore, do all the users that were invited to join the tool really need it? Do they make use of it?
The amount charged on the credit card keeps on changing, month after month… and the managers & HR department having to approve such expenses keeps on asking every month what is this strangely moving amount”…
Here we are, back to the point where we said: pay per user is great… for the app vendors, always… but probably not for the agencies!
At Teambook, we believe the right pricing driver is the number of active projects that the agencies or consulting firms are running. From a planning point of view, the number of projects better reflects the complexity of the business, because no project is similar to another.
And… as projects are the true driver for revenues, it seems reasonable to base our pricing on it!
At Teambook, we also like to make the life of our customers easier by providing clear and stable rules. For instance, we offer packages based on numbers of projects thresholds, rather than a price per project, that will keep on changing month after month.
We’d like to help our customers grow and yes, we’d also benefit from their increased project number, once they pass the next threshold.. such events are usually a good reason to celebrate… together!
As a matter of fact, our typical customers count 10-100 users, planned on 40-200 projects…At Teambook, we help our customers to best serve their projects and hence, to run successful businesses. And also, we pride ourselves on doing that with a fair pricing model – one that cuts costs by 2 to 3 times compared to our competitors.
Teambook is a Swiss-based Team planning app launched in 2014. It was one of the first actors to develop a visual planning tool and it has been serving thousands of agencies and fast-growing consulting firms around the world ever since.