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Estd 4.22.2023
Based on our saas pricing book, Price to Scale, the recommended approach is to treat API access as an add-on capability that is priced separately from your main SaaS interface. Here’s how you can approach it:
• Separate the API’s costs from the core product by exposing the underlying hard costs—similar to our discussion on API and messaging fees in Price to Scale. By doing so, you allow customers to clearly see the value (and expense) of API usage.
• Use a usage-based pricing model (such as Cost Per Message or “per API call” fees) that scales with the customer’s adoption. This helps align the API’s cost with the actual utilization, ensuring that larger customers pay in proportion to their usage.
• Consider a two-tiered add-on pricing approach where part of the fee is a fixed amount and another component is variable (for example, a percentage of the base fee). This flexibility can accommodate customers with different levels of API usage while keeping the pricing structure transparent and scalable. In our book, this concept is illustrated in the discussion and figures on add-on capability pricing.
In summary, by treating API access as a separately priced add-on and opting for a hybrid of fixed and usage-based fees, you can both highlight its independent value and maintain a scalable pricing model. For more detailed examples and frameworks, refer to the relevant sections in Price to Scale.