SaaS subscription pricing models in AWS Marketplace

This post is Part 2 of a four-part series on SaaS pricing models in AWS Marketplace. In Part 1, we covered three common configurations for the SaaS contract pricing model. In this post, we focus on the subscription pricing model.

AWS Marketplace offers three pricing models for SaaS products: contracts, subscriptions, and contracts with pay-as-you-go. The subscription pricing model, also known as the usage-based pricing, charges customers based on their actual product usage. Subscriptions remain active until the customer unsubscribes from the SaaS subscription product.

This post focuses on the SaaS subscription pricing model, outlining two common configurations and helping you determine which approach works best for your product listing in AWS Marketplace.

SaaS subscription pricing configuration

There are two common SaaS subscription pricing configurations: fixed-rate consumption pricing and tiered consumption pricing. Subscription pricing is well suited for products that charge based on a measurable consumption unit, such as gigabytes processed, transactions executed, or requests processed. With fixed-rate consumption pricing, the price per unit stays constant and customers pay for their total resource consumption. In tiered consumption pricing, the unit price changes as customers move to higher tiers, where tiers are typically determined by consumption volume. As the SaaS seller, you will need to track and report customer usage to AWS Marketplace, this will then process billing based on those metering records received.

In AWS Marketplace, dimensions define how customers are billed for a SaaS product. Each dimension measures a specific type of usage, such as number of users, API calls, or data processed. When deciding the pricing model for the product, you must decide whether to use a single dimension (for simple, usage-based pricing) or multiple dimensions (to charge for different types of usage within one subscription).

In the following sections, we show you patterns for both subscription pricing configurations.

Fixed-rate consumption pricing

With fixed-rate consumption, the unit cost remains the same (for example, $0.02 per API call or GB usage), regardless of volume consumed.

To configure fixed-rate consumption pricing when creating the SaaS listing, in the Configure product pricing step, select Usage-based pricing as the product pricing options. Define your pricing dimensions according to units used to charge for the product.

Choose the unit type that best represents how customers will be charged for your product. The unit type should align with the measurable usage that drives billing, such as number of users, requests, or data consumption. If your unit of measurement differs across dimensions, or if you anticipate it may change in the future, we recommend selecting the generic Units option. This provides flexibility, as the unit type cannot be changed once configured.

Detailed steps on how to create a SaaS listing are found in the AWS Marketplace seller workshop.

For utilization to be charged to the customers, the application will record the usage by the customer and send usage records to AWS Marketplace by using the BatchMeterUsage operation. Implementation details will be covered in Part 3 of this blog series.

The following figures show examples of fixed-rate consumption pricing. Buyers will only pay for what they use at this rate, regardless of the amount of data that is processed.

Figure 1: Sample fixed rate consumption pricing purchase options (data intelligence platform with fixed rate per TB processed).

Figure 2: Sample fixed rate consumption pricing purchase options for standard and premium API requests.

Tiered consumption pricing

Tiered consumption pricing helps align charges with your business growth. Enterprise customers with heavy usage can benefit from volume-based discounts, and customers with lower consumption can still subscribe without upfront commitments.

The SaaS application will need to monitor each customer’s ongoing usage. When a customer crosses a threshold, the application determines which tier (dimension) applies and reports usage using the BatchMeterUsage API. The technical implementation of this metering logic will be covered in part three of this blog series.

To configure tiered consumption pricing, you can use the same configuration steps described in the preceding section.

The following figures show examples of tiered consumption pricing.

Figure 3: Sample tiered consumption pricing purchase options (API application with tiered consumption pricing).

The following figure shows how much a customer pays when subscribed to the sample API protection application from the preceding figure and consumes 60,000 API calls scans in a month. The effective cost per API call scanned drops for consumption within the tier.

Figure 4: Cost example for consumption of 60,000 API calls scanned for API protection application.

Conclusion

In this post, we explored how to implement two common SaaS subscription pricing configurations in AWS Marketplace: fixed-rate consumption pricing and tiered consumption pricing.

Prior to requesting the product to be made public, the product should be thoroughly tested whilst in limited state to ensure the metering records are being sent correctly. Part three of this blog series will provide detailed guidance on implementing the metering service, testing your integration, and ensuring accurate usage reporting.

To get started with your SaaS subscription implementation:

1. Complete the prerequisites.
2. Evaluate your current pricing strategy against the common SaaS subscription pricing configurations to identify the best fit.
3. Review the AWS Marketplace SaaS subscription pricing documentation for detailed implementation guidance.
4. Create your product listing.

For more information about SaaS pricing in AWS Marketplace, refer to the other posts in our series:

• Part 1: Implementing SaaS contract pricing models in AWS Marketplace
• Part 2: SaaS subscription pricing models in AWS Marketplace (this post)
• Part 3: How to Implement SaaS Subscription pricing models in AWS Marketplace (coming soon)
• Part 4: Implementing SaaS contract with pay-as-you-go pricing models in AWS Marketplace (coming soon)

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