Consumption-based Vs. Subscription-based Pricing Models–Which Is Better For Your Business?

The choice between usage-based pricing and subscription pricing depends on understanding customer needs and operational flexibility. Usage-based pricing allows businesses to grow with customers, charging them for the value they derive, but may complicate budgeting and revenue forecasts. Subscriptions offer a win-win by locking in customers and smoothing out revenue streams, though they may not suit every customer's consumption habits. The best pricing model is one that supports business strategy, encourages usage, and satisfies customers.