Payment model definition - Revision history

Root at 08:26, 24 October 2025

2025-10-24T08:26:46Z

← Older revision		Revision as of 09:26, 24 October 2025
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	* Can create subscription fatigue if not clearly valuable		* Can create subscription fatigue if not clearly valuable

	<span id="freemium-model"></span>		== Basic concepts ==
			'''LTV'''

			Life Time Value

			'''ARPU'''

			Average Revenue Per User<span id="freemium-model"></span>

	= Freemium Model =		= Freemium Model =

Root at 11:59, 22 October 2025

2025-10-22T11:59:12Z

← Older revision		Revision as of 12:59, 22 October 2025
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	* Flash sales or live events		* Flash sales or live events

	~~===~~ '''Pros''' ~~===~~		'''Pros'''
	* Optimizes revenue		* Optimizes revenue
	* Matches market conditions		* Matches market conditions

	~~===~~ '''Cons''' ~~===~~		'''Cons'''
	* Can frustrate users		* Can frustrate users
	* Requires data infrastructure and pricing algorithms		* Requires data infrastructure and pricing algorithms

Root at 11:58, 22 October 2025

2025-10-22T11:58:37Z

← Older revision		Revision as of 12:58, 22 October 2025
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	= Recurring Payment (Subscription) =		= Recurring Payment (Subscription) =

	~~===~~ Description ~~===~~		'''Description'''
	Clients pay a recurring fee (monthly, quarterly, annually) for continued access to a service or product.		Clients pay a recurring fee (monthly, quarterly, annually) for continued access to a service or product.

	~~===~~ Best for ~~===~~		'''Best for'''
	* SaaS platforms		* SaaS platforms
	* Content platforms (media, learning, community)		* Content platforms (media, learning, community)
	* Ongoing services (e.g., hosting, newsletters, analytics)		* Ongoing services (e.g., hosting, newsletters, analytics)

	~~===~~ Pros ~~===~~		'''Pros'''
	* Predictable revenue stream		* Predictable revenue stream
	* Higher customer lifetime value		* Higher customer lifetime value

	~~===~~ Cons ~~===~~		'''Cons'''
	* Requires retention efforts		* Requires retention efforts
	* Can create subscription fatigue if not clearly valuable		* Can create subscription fatigue if not clearly valuable
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	= Freemium Model =		= Freemium Model =

	~~===~~ Description ~~===~~		'''Description'''
	Basic access is free, with premium features locked behind a paywall.		Basic access is free, with premium features locked behind a paywall.

	~~===~~ Best for ~~===~~		'''Best for'''
	* SaaS tools		* SaaS tools
	* Mobile or web apps		* Mobile or web apps
	* Community platforms		* Community platforms

	~~===~~ Pros ~~===~~		'''Pros'''
	* Low barrier to entry		* Low barrier to entry
	* Viral growth potential		* Viral growth potential

	~~===~~ Cons ~~===~~		'''Cons'''
	* Conversion rates to paid tiers can be low		* Conversion rates to paid tiers can be low
	* Free users still incur costs (support, infrastructure)		* Free users still incur costs (support, infrastructure)
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	= Pay-As-You-Go / Usage-Based =		= Pay-As-You-Go / Usage-Based =

	~~===~~ Description ~~===~~		'''Description'''
	Clients are charged based on their actual usage (e.g., per gigabyte, per API call, per transaction).		Clients are charged based on their actual usage (e.g., per gigabyte, per API call, per transaction).

	~~===~~ Best for ~~===~~		'''Best for'''
	* Cloud services (e.g., AWS, Twilio)		* Cloud services (e.g., AWS, Twilio)
	* Financial services, marketplaces		* Financial services, marketplaces
	* Infrastructure-heavy tools		* Infrastructure-heavy tools

	~~===~~ Pros ~~===~~		'''Pros'''
	* Scales with customer success		* Scales with customer success
	* Attractive to cost-conscious users		* Attractive to cost-conscious users

	~~===~~ Cons ~~===~~		'''Cons'''
	* Unpredictable revenue		* Unpredictable revenue
	* Can lead to surprise bills, causing churn		* Can lead to surprise bills, causing churn
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	= Pay What You Want =		= Pay What You Want =

	~~===~~ Description ~~===~~		'''Description'''
	Clients set their own price — sometimes with a suggested or minimum amount.		Clients set their own price — sometimes with a suggested or minimum amount.

	~~===~~ Best for ~~===~~		'''Best for'''
	* Digital goods		* Digital goods
	* Independent creators or mission-driven businesses		* Independent creators or mission-driven businesses
	* Crowdfunding-style offerings		* Crowdfunding-style offerings

	~~===~~ Pros ~~===~~		'''Pros'''
	* Builds goodwill		* Builds goodwill
	* Can outperform fixed pricing if marketed well		* Can outperform fixed pricing if marketed well

	~~===~~ Cons ~~===~~		'''Cons'''
	* Revenue unpredictability		* Revenue unpredictability
	* Can devalue perceived worth		* Can devalue perceived worth
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	= Tiered Pricing =		= Tiered Pricing =

	~~===~~ Description ~~===~~		'''Description'''
	Multiple pricing levels based on features, usage, or user type.		Multiple pricing levels based on features, usage, or user type.

	~~===~~ Best for ~~===~~		'''Best for'''
	* SaaS platforms		* SaaS platforms
	* Creative services		* Creative services
	* Membership-based communities		* Membership-based communities

	~~===~~ Pros ~~===~~		'''Pros'''
	* Appeals to multiple customer segments		* Appeals to multiple customer segments
	* Encourages upgrades over time		* Encourages upgrades over time

	~~===~~ Cons ~~===~~		'''Cons'''
	* Complex to manage and explain		* Complex to manage and explain
	* Risk of “analysis paralysis” during purchase		* Risk of “analysis paralysis” during purchase
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	= Dynamic Pricing =		= Dynamic Pricing =

	~~===~~ Description ~~===~~		'''Description'''
	Prices change based on factors like demand, user behavior, or timing.		Prices change based on factors like demand, user behavior, or timing.

	~~===~~ Best for ~~===~~		'''Best for'''
	* Booking platforms (e.g., airlines, hotels)		* Booking platforms (e.g., airlines, hotels)
	* eCommerce		* eCommerce
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	= Licensing =		= Licensing =

	~~===~~ Description ~~===~~		'''Description'''
	Clients pay to use your IP (content, software, training, etc.) under specific conditions.		Clients pay to use your IP (content, software, training, etc.) under specific conditions.

	~~===~~ Best for ~~===~~		'''Best for'''
	* B2B software		* B2B software
	* Educational or media content providers		* Educational or media content providers
	* White-label solutions		* White-label solutions

	~~===~~ Pros ~~===~~		'''Pros'''
	* Scalable with limited direct interaction		* Scalable with limited direct interaction
	* Can lead to large contracts		* Can lead to large contracts

	~~===~~ Cons ~~===~~		'''Cons'''
	* Legal complexity		* Legal complexity
	* High support requirements for enterprise clients		* High support requirements for enterprise clients

Root at 11:57, 22 October 2025

2025-10-22T11:57:16Z

← Older revision		Revision as of 12:57, 22 October 2025
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	= One-Time Payment =		= One-Time Payment =
			'''Description'''

	~~=== Description ===~~
	A flat, upfront fee for lifetime access to a product or service.		A flat, upfront fee for lifetime access to a product or service.

	~~===~~ Best for ~~===~~		'''Best for'''
	* Digital products (eBooks, templates, software licenses)		* Digital products (eBooks, templates, software licenses)
	* Courses or downloads		* Courses or downloads
	* Simple services with no ongoing support required		* Simple services with no ongoing support required
			'''Pros'''
	~~===~~ Pros ~~===~~
	* Immediate revenue		* Immediate revenue
	* Low commitment for customers		* Low commitment for customers
			'''Cons'''
	~~===~~ Cons ~~===~~
	* No recurring revenue		* No recurring revenue
	* Harder to scale customer lifetime value		* Harder to scale customer lifetime value
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	* Highly dependent on client performance		* Highly dependent on client performance
	* Longer revenue cycle		* Longer revenue cycle


	~~-----~~

	<span id="microtransactions-in-app-purchases"></span>		<span id="microtransactions-in-app-purchases"></span>
	~~== '''Microtransactions / In-App Purchases''' ==~~

			= Microtransactions / In-App Purchases =
	'''Description'''		'''Description'''

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	* Requires high volume to scale		* Requires high volume to scale

			= Donations / Patronage =
	~~-----~~

	~~<span id~~=~~"donations-patronage"></span>~~
	~~== '''~~Donations / Patronage~~''' =~~=

	'''Description'''		'''Description'''

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	* Needs strong emotional or ideological connection		* Needs strong emotional or ideological connection


	~~-----~~

	= Bundled Pricing =		= Bundled Pricing =

Root at 11:56, 22 October 2025

2025-10-22T11:56:27Z

← Older revision		Revision as of 12:56, 22 October 2025
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	= Recurring Payment (Subscription) =		= Recurring Payment (Subscription) =

	=== ~~'''~~Description~~'''~~ ===		=== Description ===
	Clients pay a recurring fee (monthly, quarterly, annually) for continued access to a service or product.		Clients pay a recurring fee (monthly, quarterly, annually) for continued access to a service or product.

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	* Requires data infrastructure and pricing algorithms		* Requires data infrastructure and pricing algorithms

			<span id="licensing"></span>

	~~-----~~		= Licensing =

	~~<span id~~=~~"licensing"></span>~~		=== Description ===
	== ~~8. '''Licensing'''~~ ==

	~~'''Description:'''<br />~~
	Clients pay to use your IP (content, software, training, etc.) under specific conditions.		Clients pay to use your IP (content, software, training, etc.) under specific conditions.

	~~'''~~Best for~~:'''~~		=== Best for ===

	* B2B software		* B2B software
	* Educational or media content providers		* Educational or media content providers
	* White-label solutions		* White-label solutions

	~~'''~~Pros~~:'''~~		=== Pros ===

	* Scalable with limited direct interaction		* Scalable with limited direct interaction
	* Can lead to large contracts		* Can lead to large contracts

	~~'''~~Cons~~:'''~~		=== Cons ===

	* Legal complexity		* Legal complexity
	* High support requirements for enterprise clients		* High support requirements for enterprise clients

			<span id="revenue-share-commission-based"></span>

	-~~----~~		= Revenue Share / Commission-Based =
			'''Description'''

	~~<span id="revenue-share-commission-based"></span>~~
	~~== 9. '''Revenue Share / Commission-Based''' ==~~

	~~'''Description:'''<br />~~
	You earn a percentage of the revenue generated by your customer’s use of your platform or service.		You earn a percentage of the revenue generated by your customer’s use of your platform or service.

	'''Best for:'''		'''Best for'''

	* Marketplaces		* Marketplaces
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	* Affiliate-driven businesses		* Affiliate-driven businesses

	'''Pros:'''		'''Pros'''

	* Aligns incentives		* Aligns incentives
	* No upfront cost for clients		* No upfront cost for clients

	'''Cons:'''		'''Cons'''

	* Highly dependent on client performance		* Highly dependent on client performance
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	<span id="microtransactions-in-app-purchases"></span>		<span id="microtransactions-in-app-purchases"></span>
	== ~~10.~~ '''Microtransactions / In-App Purchases''' ==		== '''Microtransactions / In-App Purchases''' ==

			'''Description'''

	~~'''Description:'''<br />~~
	Small payments for individual features, items, or upgrades within a platform.		Small payments for individual features, items, or upgrades within a platform.

	'''Best for:'''		'''Best for'''

	* Mobile apps		* Mobile apps
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	* Content upgrades (e.g., templates, filters)		* Content upgrades (e.g., templates, filters)

	'''Pros:'''		'''Pros'''

	* Low entry cost		* Low entry cost
	* Encourages repeat purchases		* Encourages repeat purchases

	'''Cons:'''		'''Cons'''

	* Can feel manipulative if poorly designed		* Can feel manipulative if poorly designed
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	<span id="donations-patronage"></span>		<span id="donations-patronage"></span>
	== ~~11.~~ '''Donations / Patronage''' ==		== '''Donations / Patronage''' ==

			'''Description'''

	~~'''Description:'''<br />~~
	Clients voluntarily support your work with recurring or one-time contributions, often without receiving a traditional product.		Clients voluntarily support your work with recurring or one-time contributions, often without receiving a traditional product.

	'''Best for:'''		'''Best for'''

	* Creators, journalists, artists		* Creators, journalists, artists
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	* Nonprofits or public goods		* Nonprofits or public goods

	'''Pros:'''		'''Pros'''

	* Builds loyal community		* Builds loyal community
	* Flexible pricing by nature		* Flexible pricing by nature

	'''Cons:'''		'''Cons'''

	* Revenue volatility		* Revenue volatility
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	-----		-----

	~~<span id~~=~~"bundled-pricing"></span>~~		= Bundled Pricing =
	~~== 12.~~ '''~~Bundled Pricing~~''' ==		'''Description'''

	~~'''Description:'''<br />~~
	Multiple products or services sold together at a single (often discounted) price.		Multiple products or services sold together at a single (often discounted) price.

	'''Best for:'''		'''Best for'''

	* Cross-sell/upsell campaigns		* Cross-sell/upsell campaigns
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	* Education or training packages		* Education or training packages

	'''Pros:'''		'''Pros'''

	* Increases perceived value		* Increases perceived value
	* Raises average order value		* Raises average order value

	'''Cons:'''		'''Cons'''

	* Clients may only want part of the bundle		* Clients may only want part of the bundle
	* Complexity in value attribution		* Complexity in value attribution
	[[Category:Company management]]		[[Category:Company management]]

Root at 11:54, 22 October 2025

2025-10-22T11:54:30Z

← Older revision		Revision as of 12:54, 22 October 2025
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	* Simple services with no ongoing support required		* Simple services with no ongoing support required

	=== ~~'''~~Pros~~'''~~ ===		=== Pros ===
	* Immediate revenue		* Immediate revenue
	* Low commitment for customers		* Low commitment for customers

	=== ~~'''~~Cons~~'''~~ ===		=== Cons ===
	* No recurring revenue		* No recurring revenue
	* Harder to scale customer lifetime value		* Harder to scale customer lifetime value

Root at 11:53, 22 October 2025

2025-10-22T11:53:39Z

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Maintenance script: Added category Company management

2025-10-19T17:50:26Z

Added category Company management

← Older revision		Revision as of 18:50, 19 October 2025
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			[[Category:Company management]]

Maintenance script: Maintenance script moved page UserDocumentation:Knowledge Central/KC Executive/Company management/Payment model definition to Payment model definition: Cleaned title and categorized

2025-10-19T17:50:26Z

Maintenance script moved page UserDocumentation:Knowledge Central/KC Executive/Company management/Payment model definition to Payment model definition: Cleaned title and categorized

← Older revision	Revision as of 18:50, 19 October 2025
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imported>Unknown user at 17:07, 14 July 2025

2025-07-14T17:07:35Z

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