Adapting SaaS Metrics for Usage-Based and Monthly Pricing Models
Dave Kellogg explores how traditional SaaS metrics like MRR and ARR must be reconceptualized in usage-based and month-to-month pricing models. He argues that 'recur' never meant contractual commitment, but rather revenue that has the potential to repeat, and proposes using trailing spend calculations instead of trying to force monthly allocations in variable pricing environments.
Metrics in this report
255$
actual quarterly
15 credits at $17 per credit
289$
actual quarterly
34 credits consumed
19%
hypothetical contraction scenario
if spend contracted from $289 to $234
17-20$
range with volume discounts
usage-based bar model with 20+ credit discount
124%
year-over-year comparison 2Q21 to 2Q22
includes 4 unit growth plus $17 vs $18 per-unit price improvement
52credits/year
annual contract value
illustrative usage-based pricing example