If our customers’ usage is seasonal or variable, should we offer any accommodations (like averaging usage over a period or allowing unused quota to roll over) to make pricing feel fair and stable?

Based on our pricing strategy book, Price to Scale, making pricing feel fair and stable is important—especially when facing seasonal or variable customer usage. While our book doesn’t mandate a single approach, it does present the idea that pricing models must align with how your customers actually use your service.

Here are some key takeaways from our book that apply to this question:

• Customer Fairness and Stability:
Our book emphasizes that customers value predictability. Accommodations like averaging usage over a billing period or carrying forward unused quotas can be effective ways to mitigate the shock of seasonal spikes or lulls. However, it’s important to balance these accommodations with revenue predictability for your business.

• Adjustments and Transition Options:
As discussed in Price to Scale, offering temporary concessions (such as rolling over a quota or providing a grace period to renew at current rates) can ease customers into new pricing structures without causing financial strain. For example, our discussion of multi-year ramp deals shows how gradual adjustments can help both the customer budget and revenue stability.

• Methodical Design of Accommodations:
The book highlights that any accommodation (like quota rollovers or usage averaging) needs careful consideration. You need to ensure that it does not distort the intended consumption signals of your pricing model. The design should provide clarity for customers while still incentivizing them to move toward your value-enhancing bundles.

In summary, if your customers experience seasonal or variable usage, offering accommodations—such as averaging usage over a period or rolling over unused quota—can be an effective tool to maintain fairness and stability. Just be sure to design these options in a way that aligns with your overall revenue strategy and the principles outlined in Price to Scale.