Pay-as-you-go has several clear benefits especially for startup pricing model. There’s a very low barrier to entry for customers, and offers them more flexibility around the products they want and when they want them.
Why it is essentially good for startup pricing model
- Smaller barrier to entry
- No commitment
- Better cost-per-use
A customer doesn’t need to commit to a prescribed plan and get charged on a monthly basis. They just pay once for a product or service and then start using it. It works well for products that are needed infrequently.
Consumers don’t have to make a commitment up front and can budget accordingly. Pay-as-you-go works for well in regions like Africa and I think that is why some international businesses struggle to gain market in certain region.
