Why Hybrid Pricing is Taking Over SaaS

As SaaS businesses seek the ideal balance between revenue stability and customer flexibility, hybrid pricing models are emerging as the industry standard. The 2025 SaaS Pricing Trends Report, powered by survey data from Benchmarkit and 316 companies, explores the pricing and billing strategies shaping the future of SaaS. With hybrid models reporting the highest median growth rate of 21%, it’s clear that this approach is driving success.

High-growth SaaS companies, particularly those exceeding 40% annual growth, overwhelmingly prefer hybrid models. By combining the predictability of subscriptions with the scalability of usage-based pricing, these models offer businesses financial stability while allowing customers to scale their spending based on need. Let’s explore why hybrid pricing is gaining momentum, the financial benefits it provides, and best practices for implementation.

Why Hybrid Pricing Works

Hybrid pricing blends the best aspects of subscription and usage-based models, providing steady revenue while giving customers the flexibility to scale as needed. Adoption rates are rising rapidly, particularly in North America, where companies are leading the charge. The model’s flexibility allows customers to start with a base subscription fee while scaling their usage-based costs as they grow, making it an attractive option for both B2B and B2C SaaS companies.

Beyond revenue predictability, hybrid pricing aligns with modern customer expectations. Businesses are moving away from rigid pricing structures in favor of models that better reflect actual usage patterns. Enterprise SaaS companies, in particular, benefit from hybrid pricing’s ability to balance predictable costs with scalable growth potential, ensuring customers are never locked into pricing that doesn’t match their needs.

The Financial Impact of Hybrid Pricing

Hybrid pricing isn’t just about flexibility—it’s a proven driver of revenue growth and retention. Companies adopting this model report significant improvements in key financial metrics:

Increases Customer Lifetime Value (LTV)

By allowing customers to start small and scale over time, hybrid pricing naturally extends customer relationships and increases total lifetime value. Customers can expand their spending incrementally rather than being forced into costly upgrades, improving retention and overall revenue.

Improves Net Revenue Retention (NRR)

Hybrid pricing enables stronger expansion revenue from existing customers. By incorporating a usage-based component, companies see a steady increase in spending from their user base without having to rely solely on new customer acquisition.

Reduces Revenue Volatility

Usage-only pricing models can lead to unpredictable cash flow, while subscription-only models may limit growth potential. Hybrid pricing smooths out these fluctuations, offering a more stable financial foundation for SaaS companies to build upon.

Best Practices for Implementing Hybrid Pricing

To successfully implement a hybrid pricing model, SaaS companies need to be strategic about how they balance subscription fees with usage-based elements. Here are key best practices:

Define the Right Pricing Mix

Finding the right balance between subscription and usage-based pricing is essential. Companies should consider:

• What core services should be covered under a fixed subscription fee?
• What usage metrics provide the best value alignment for customers?
• How can pricing be structured to allow for both stability and scalability?

Prioritize Billing Transparency

With 43% of SaaS companies now billing more frequently than monthly, transparency is critical for customer trust. To create a seamless billing experience:

• Offer itemized invoices that clearly outline both subscription and usage-based charges.
• Provide real-time dashboards so customers can monitor their spending.
• Implement proactive alerts to notify users before they exceed usage thresholds.

Automate Billing and Revenue Management

Managing hybrid pricing manually can be inefficient and error-prone. Instead, companies should leverage automation:

• Use billing software that supports both recurring and variable pricing.
• Integrate revenue forecasting tools to anticipate usage trends.
• Ensure seamless invoicing and reporting to minimize disputes and maximize trust.

Overcoming Challenges in Hybrid Pricing

While hybrid pricing offers significant benefits, there are challenges to consider. The most common pitfalls include:

Aligning Usage-Based Charges with Perceived Value

If customers don’t see a clear connection between their usage and pricing, they may feel they are being overcharged. To avoid this:

• Ensure that usage-based metrics are directly tied to the value customers receive.
• Provide clear, real-time visibility into usage and associated costs.

Avoiding Complexity in Billing Structures

Overly complicated pricing tiers can create confusion and frustration. Companies should aim for:

• Simple, well-communicated pricing models.
• Transparent breakdowns that customers can easily understand.
• Streamlined billing processes that minimize friction and support inquiries.

Shaping the Future of SaaS Pricing

Hybrid pricing is becoming the dominant SaaS model because it delivers the best of both worlds—predictable revenue and customer-centric flexibility. As adoption accelerates, businesses that successfully implement hybrid pricing will be better positioned for long-term growth.

North America continues to lead in hybrid pricing adoption, while European SaaS companies are gradually incorporating usage-based elements into their pricing strategies. B2B SaaS firms, in particular, are shifting to hybrid models to balance stability with expansion potential.

Want to dive deeper into how top SaaS companies are leveraging hybrid pricing for success? Download the full 2025 SaaS Pricing Trends Report to access detailed benchmarks and insights from 316 SaaS companies.