Strategies for pricing software products in a down market

Per-seat pricing has been a long-standing standard for B2B SaaS due to its simplicity and fairness, as it aligns revenue with user growth, yet this model is becoming problematic amid economic downturns and widespread layoffs. Companies are re-evaluating this pricing method as it no longer guarantees growth, and customers increasingly bypass it by sharing accounts. Additionally, per-seat pricing can constrain long-term value creation and capturing, especially for products that thrive on network effects and collaboration within organizations. Companies are now exploring hybrid pricing models, such as billing based on active users or introducing add-ons, to reduce reliance on user count for growth. This shift is driven by the need to adapt to new economic realities, leverage AI advancements, and explore innovative revenue models, such as monetizing payments in vertical SaaS applications. As a result, B2B SaaS companies are likely to audit their revenue models to remain competitive and capture value in a changing market landscape.