How to Price Your WordPress SaaS: A Detailed Guide to Picking the Right Pricing Model 

So, you’ve created an impressive WordPress SaaS (Software as a Service) product and you’re stuck on how to price it. 

Don’t worry, you’re not alone. 

Unlike traditional plugins, where users pay a one-time fee or -at most- an annual renewal fee, SaaS products require a different way of thinking about pricing. 

Get it right, and you set yourself up for long-term success. Get it wrong, and at best, you leave money on the table. At worst, you risk driving away potential customers. 

In this guide, we teach you how to get it right. 

Below, you’ll discover: 

• The unique challenges of pricing WordPress SaaS products.

• Popular pricing models and which ones work best.

• Real-world case studies of WordPress SaaS pricing strategies—what worked and what didn’t.

• The key metrics you need to track to ensure pricing success.

• By the time we’re done, you’ll know how to optimize your pricing strategy to create a sustainable and truly profitable WordPress business. 

Ready? Let’s get started. 

The Challenges of Pricing WordPress SaaS

While adopting the SaaS pricing model provides a welcome opportunity to generate long-term recurring revenue, it also presents a number of challenges as diverse as they are complex. 

These challenges include: 

1. Meeting Customer Expectations 

Traditionally, WordPress plugins are sold with either a one-off fee or an annual license, meaning customers are used to paying once, or at most, once a year, to essentially own a product indefinitely. 

SaaS pricing bucks that trend, and it can be a big ask to convince customers to pay recurring fees for your plugin. 

2. Hosting and Infrastructure Costs 

Unlike traditional plugins, which are generally hosted directly within the WordPress environment, SaaS tools require a hosting server, databases, and APIs, all of which cost money. 

Naturally, this makes it even more difficult to figure out pricing since you now have ongoing operational and maintenance costs that need to be covered by your subscription fees.

3. Support and Maintenance

If customers are paying for your service on a regular basis, you’d better believe they’ll want high-quality support when they need it most. That might mean that you need to invest more to provide reliable customer service that’s responsive round the clock.

Where it All Goes Wrong: The Biggest Mistake WordPress Product Owners Make 

Where rookie WordPress entrepreneurs often go wrong is that they struggle to ensure balance in their pricing structure. 

Sometimes, this means setting prices too low to attract more customers, not realizing that ‘cheap’ isn’t always a good thing. 

In fact, pricing too low can make customers question the quality of your product, while a higher price -backed by a solid value proposition- can actually increase public perception of your product and attract higher-value customers who don’t mind shelling out for premium features. 

The end result is you not only end up underselling yourself, but, by doing so, you also end up making it harder to cover overheads while still turning a profit. 

Occasionally, it also goes the other way; charging too much without delivering the added-value that would justify a higher price. 

Do that, and customers simply turn to a competitor who offers a similar product at a better price. 

So yes, it’s tricky, but that doesn’t mean there’s no way to create that fine balance between attracting customers with competitive pricing and ensuring the sustainability and profitability of your business.

Pricing Models Explained

The first step towards finding the perfect pricing structure for your product is to understand the most common models available to you. 

That way: 

Here’s a breakdown of the most common and effective models used by WordPress-related companies. 

1. Feature-Tiered Pricing

The most common SaaS pricing model, a tiered structure allows customers to choose a plan based on the features they need. 

For example, you might have a Basic plan with bare-bones functionality, a Pro plan that offers a few advanced features and capabilities, and an Enterprise plan that unlocks the full potential of your product, with access to its full suite of features and value-adds such as priority support. 

You can see this model at work with tools like the Elementor page builder. Here, customers have a range of plans to choose from, with higher-priced plans offering more tools, templates, and site licenses than lower-cost models. 

Pros:

• Appeals to a broad range of customers (small businesses to enterprises).
• Encourages upgrades as users grow.
• Simple to understand and market.

Cons:

• Can lead to decision paralysis if there are too many tiers.
• Customers may feel forced to upgrade for essential features.

Best for: 

• Products with clear feature differentiators
  
• Products where higher-tier customers get more value from additional features.

2. Usage-based pricing 

This is the type of model typically employed by email marketing tools, analytics, and, increasingly, AI tools. Here, customers pay for each individual use of the service, whether that means paying for each email sent, each API request generated, or every data query processed.

For example, RankMath’s Content AI tool is available at three price points: $4.99, $8.99, and $14.99. The more you pay, the more credits you get. 

Each credit counts towards either content research or creation, so the more you pay, the more you can use RankMath to generate AI content for your WordPress site. 

Pros:

• Allows for scalability – Customers pay only for what they need when they need it.
• The low starting costs can reduce barriers to entry for customers.
• Easier to align costs with the actual value of the delivered service. 

Cons:

• Harder to predict revenue.
• Customers may feel nickel-and-dimed if pricing isn’t transparent.

Best for:

• SaaS tools where usage varies significantly between customers (for example, cloud storage or API-related services).

• Businesses that serve startups and enterprises alike, allow small users to start cheap and scale up.
  

3. Hybrid Pricing 

A hybrid model is exactly what it sounds like: 

A mix of both feature-tiered and user-based pricing where customers typically pay a flat rate for access to the service plus additional fees based on usage. 

For example, Sendgrid‘s higher-priced plans offer a number of credits towards email content testing, but if that isn’t enough -or if users want a lower-cost plan with bundled credits- they can always pay for more. 

Pros:

• Provides predictable baseline revenue while allowing high-value customers to pay more.
• Works well when some features have scalable costs 

Cons:

• Some customers may find pricing confusing if its not communicated clearly

Best for:

• SaaS tools where core features are needed by all customers, but some require additional resources 

4. Post-Billing

Most SaaS businesses, including WordPress-based ones, rely on pre-billing. In other words, charging customers upfront for access to their services. 

Think about the way you pay for your web hosting. With most companies, you hand over your credit card details, and, in return, you get access to your hosting company’s services until your contract renews. 

However, some companies, such as Cloudways, opt for a pay-after-usage (post-billing) model, whereby you can select an hourly rate and then pay after the fact, with the total cost of your bill determined by your actual usage.

Pros:

• Ensures predictable cash flow 
• Easy to align costs with actual usage, making it attractive to customers who don’t want to pay for resources they’re not using. 

Cons:

• Customers may be surprised by high usage charges if they’re not carefully tracking their consumption.

Best for:

• Businesses that want to attract customers with low upfront costs but still charge for increased usage.

Monthly vs. Annual Pricing: Which is Better for Your Business?

Even after choosing the right pricing model for your WordPress SaaS, you still have one crucial decision to make:

Charge customers on a monthly basis or convince them to commit to an annual plan?

Each approach has its own pros and cons, and the right choice depends on your product, audience, and long-term business goals.

The Case for Monthly Pricing

Monthly billing is the default option for many SaaS companies, offering a low-commitment way for customers to try out a service without a significant upfront investment.

On the one hand, it creates a lower barrier to entry than high annual fees, and this can be a deal-breaker for small-budget customers who can only commit to a smaller upfront payment. 

On the other hand, there’s a much higher churn risk. 

Think about it:

Customers can take their business elsewhere, or simply decide to stop paying  you, at any time they like. The more they do that, the harder you’ll need to work to replace them with fresh customers. 

The Case for Annual Pricing

Annual pricing customers pay for a full year in advance, often at a discounted rate compared to monthly billing.

Getting this year-long commitment from your customers not only reduces potential churn, but it also means you get more upfront revenue that can be reinvested into further development or marketing. 

On the downside, the higher upfront cost can be a turn-off for some customers, especially if you don’t give them a decent free trial so that they can see what they’re paying for. 

Ultimately, you may find that the best approach is one similar to companies like WP Engine, who offer customers the choice to pay either monthly or yearly while incentivizing them to pick the latter by offering a discount on annual plans.

Case Studies and Lessons from Experts 

The good thing about pricing a WordPress SaaS business is that if one model doesn’t, it’s not too late to experiment and find one that does. 

Here’s just three examples of plugin developers who benefited from a pricing pivot. 

1. Barn2 Plugins: How Doubling Prices Increased Both Revenue & Sales

If you’re worried about high prices meaning low take up, look no further than popular plugin business, Barn2 Plugins for a great example of why that’s not always the case.

Pricing WordPress SaaS: Balancing Value and Growth – YouTube 

After years of selling premium plugins at relatively low prices, Barn2 doubled its pricing. Instead of seeing a drop in sales, both sales volume and overall revenue actually increased:

Why it worked:

The key to Barn2’s successful price hike lies in customer perception. Customers associate high prices with high value, seeing Barn2’s products as a more premium and trustworthy alternative to the company’s ‘cheap’ competitors. 

What’s more, raising prices kept bargain hunters at bay, meaning better customer retention and lower support costs. 

The lesson learned here? 

If your product delivers real value, don’t be afraid to charge what it’s worth. In many cases, higher pricing can attract more serious customers and increase overall revenue.

2. Jilt: When Revenue-Based Pricing Didn’t Work

Before it closed down in 2022, Jilt was an email marketing tool for WooCommerce. 

Initially, the company experimented with a revenue-based pricing model, charging users based on the revenue recovered through abandoned cart emails.

When you think about it, the logic makes sense: 

The more money customers made using Jilt, the more they would pay for the service. 

However, the model ultimately failed for a couple of reasons.

For one thing, customers didn’t want to share their revenue data with a third party. For another, they saw the pricing as unpredictable and unfair. Even when Jilt drove significant sales, users weren’t comfortable with revenue-sharing.

Jilt later switched to a tiered, feature-based pricing model that better aligned with what customers actually wanted. The result? Jilt’s fortunes improved and the platform continued to grow until its developers, SkyVerge, were acquired by GoDaddy. 

The bottom line here is this:

While revenue-based pricing sounds appealing, customers prefer predictability. If they feel like they’re paying an undefined or uncontrollable amount, they’ll look for alternatives.

3. Trusted Login by Zack Katz: How to Price a Blue-Ocean SaaS Product

How do you figure out the pricing for an innovative product in a completely new niche when you have no obvious competitors to benchmark against?

That’s the challenge Zack Katz faced with Trusted Login, a secure authentication tool for WordPress. With no direct pricing models to copy, he had to experiment with different approaches:

• Freemium + Paid Add-ons – Customers could use a basic version for free but had to pay for advanced security features.

• Flat Subscription Model – A simple, per-site monthly fee.

• Usage-Based Pricing – Charging based on authentication requests.

No surprise, a clear, simple flat-rate model won the day as customers much preferred to know exactly what they were paying rather than deal with fluctuating costs. 

Again, there’s a simple lesson to be learned here: 

When you’re diving into a blue-ocean market with no direct competitors to influence your pricing, keep it simple Customers don’t want to guess how much they’ll pay, so an intuitive, transparent pricing model works best.

Of course, these three businesses didn’t just decide to switch up their pricing structure on a whim. They paid close attention to their data and what it revealed about customers’ perceptions of the company. 

With that in mind, let’s take a look at which types of data matter most: 

Key Metrics to Track for Pricing Success

As with any business, your metrics matter. They’re not just numbers on a page, they tell an accurate story of how your customers feel about your pricing. 

If those numbers are way down, that story could reveal a useful lesson about what needs to be changed.

But which metrics should you be focusing on? Let’s break it down. 

1. Monthly Recurring Revenue (MRR)

MRR is simply the total predictable revenue you generate each month from subscriptions and it’s the most straightforward way of getting a clear picture about whether or not your pricing model is working. 

If your MRR is up, you’re doing something right. If it’s stagnant -or, worse, falling- then it might be time to correct course. 

Calculating MRR is easy. It’s just the total number of customers multiplied by the amount those customers pay. 

For example, if you have 100 customers paying $50/month, your MRR is $5,000.

2. Net Revenue Retention (NRR)

Net Revenue Retention (NRR) measures much revenue you keep from existing customers over time, factoring in both churn and customers upgrading and downgrading their plans. 

You can calculate your NRR by 

• Taking your current MRR
• Adding the number of upgrades
• Subtracting any churn, 
• Then dividing that by your starting MRR.

For example, if you started the month with $10,000 MRR, gained $2,000 from upgrades, and lost $1,000 from churn, your NRR would be 110%. 

In an ideal world, you’re looking for an NRR of 100%, which shows that your business is able to retain customers and even grow within your existing base. 

If it’s less than that, customers are downgrading or leaving faster than they’re upgrading and it may be time to rethink your strategy. 

3. Customer Lifetime Value (LTV)

Tracking Customer Lifetime Value (LTV) tells you total revenue you can expect from a customer before they churn.

For example, if a customer pays $30/month and stays subscribed for 24 months, the LTV is $720.

This can give you a good indication of how profitable your business really is. 

A high LTV shows that what you’re doing is working. Customers are sticking around and getting enough value from your product that they don’t mind paying the asking price. 

Meanwhile, a low LTV shows that something isn’t working. This number should always be much higher than your Customer Acquisition Costs (CAC). 

If it isn’t, this shows that you’re spending too much on getting new customers and not generating enough revenue in return. With that in mind, you may need to address your CAC, or at the very least explore why customers aren’t sticking around and do something about it. 

4. Churn Rate and How to Manage It

We’ve talked a lot about churn in this guide, but what exactly is it? In a nutshell, your churn rate simply shows you the percentage of customers who cancel their subscription within a given period. 

Say you start with 1,000 customers and lose 50 in a month. [SUM HERE]. So you have a 5% churn rate.

This can tell you a lot about how customers perceive your product. For example, if customers churn shortly after sign-up, that might be a sign that they don’t see any value in your product, that it’s too difficult to use or that they just don’t see any value in what you have to offer.

Naturally, the higher your churn rate, the less revenue you’re generating. So what can you do to fix that? 

Try the following: 

• Offer discounted annual plans –  If customers can save money paying for a year in advance rather than on a monthly basis, it can encourage them to commit for a longer period, boosting retention and lowering churn.
  
• Improve onboarding – Is your onboarding experience excessively long or needlessly complex? Smooth it out so that customers can start getting value from your product much faster. 

• Offer a downgrade option – If customers can no longer afford your higher-priced plans, isn’t it better to let them switch to a lower-cost plan than lose them altogether? 

5. Comparing Overheads vs. Revenue 

Finally, look at your outgoings. How much are you spending on customer support, hosting and infrastructure, and ongoing product development? 

Are you charging enough to cover those overheads while still turning a profit? If not, it’s time to make a change. 

Although this might mean raising prices, it could also mean taking steps to cut costs without cutting corners. 

For example, if you’re spending a ton on customer support, you might consider investing more in documentation and troubleshooting guides so that customers can fix more of their problems without opening a ticket.

It might even present a golden opportunity to add more value to your top-tier plans by offering priority support to higher-paying customers. 

Whatever it is, be sure to carefully evaluate your options and choose the best path forward to balance both customer satisfaction and profitability.

More Common Pricing Mistakes & How to Avoid Them

The biggest mistake WordPress SaaS owners make is either charging too little (and thus not making enough profit), or charging too much without demonstrating the kind of value that would justify high prices. 

Still, it’s not the only mistake we’ve seen newcomers make. 

Whichever pricing model you decide upon, avoiding the following common pitfalls will help you establish a sustainable and profitable pricing structure.

• Not offering the right upgrade paths – What if a customer’s business evolves or expands to the point they outgrow their current plan? If they don’t see a clear reason to upgrade, they’ll simply take off. So, make sure each tier provides a compelling reason to move up.
  
• Overcomplicating pricing – Too many options or unclear pricing structures confuse potential buyers, leading to drop-offs. Keep your pricing simple, transparent, and easy to compare.
  
• Failing to use billing tools –  Handling payments and subscriptions manually isn’t just inefficient, it opens you up to all kinds of possible human errors that could negatively impact your bottom line. So, take advantage of tools like Stripe and Chargebee to put your billing on autopilot, reduce errors, and free up time to focus on what’s important: Growing your business. 

The Future of WordPress SaaS Pricing

If there’s one thing about WordPress that’s for certain, it’s that nothing is for certain. 

Remember, this is an ever-changing, constantly evolving ecosystem we’re dealing with, one where everything from general business trends to the rise of emerging technologies like AI can affect how we approach pricing models

As a WordPress SaaS business, this means that setting your pricing may not be a one-and-done kind of deal. It means keeping abreast of the changes in the industry and the way they mold and influence customer expectations. 

For example, AI-powered WordPress tools and hosted services are pushing more SaaS products toward usage-based and hybrid pricing models. Instead of fixed fees, businesses are charging based on API calls, storage, or AI processing power, ensuring customers pay for exactly what they use. 

With that in mind, it may be that you have to revisit your pricing structure every now and again to keep up with these new industry standards.

We’re also seeing WordPress businesses begin to embrace the flexible, pay-as-you-go pricing models typically reserved for cloud computing companies. So, don’t be afraid to experiment with offering tiered pricing or subscription models that allow customers to scale their usage up or down as needed. 

Going forward, your WordPress business could do well to take cues not from WordPress itself, but rather Shopify and its rich ecosystem of third-party apps. There, we often see app developers blend free trials, usage-based pricing, and revenue-sharing models to maximize adoption while ensuring profitability. 

Similar strategies could prove just as effective for your SaaS, particularly for products tied to eCommerce, but don’t jump on the latest trends because everybody else is doing it. 

Instead, take a look at your data and your customer feedback to determine when, how, and why you should adapt your pricing to align with what customers want from you. 

Pricing Your WordPress SaaS: Key Takeaways 

At first glance, pricing your WordPress SaaS can seem like a tough task. From the number of possible pricing models to shifting customer expectations, there’s so many variables and potential challenges that make it more complex than a typical one-off or annual payment model. 

Still, by analyzing key metrics such as your Monthly Recurring Revenue and churn rate and assessing how typical SaaS price models can be adapted to the unique nature of your service, you’ll be better equipped to find a price point that both appeals to customers and generates a profit.

Just remember:

• Pick the pricing model that best suits your unique business –  Whether it’s tiered pricing, usage-based models, or a freemium approach, each model offers different benefits depending on your business type and customer base.

• Don’t be afraid to pivot – As the likes of Barn2, Jilt, and Trusted Login prove, changing your pricing structure can reap rewards. If what you’re currently doing isn’t working, stop doing it. Evaluate and make changes that work for you and your customers. 

• Stay up-to-date with the industry – The prices you set now may not always work in a market that’s constantly evolving. With AI related services driving the industry to a point where metered, pay-as-you pricing is becoming the norm, don’t be too surprised if you have to make that aforementioned pricing pivot sooner rather than later. 

Looking for the best tools to help boost conversions for your new WordPress SaaS? Check out our top recommended WordPress plugins for business websites.