This is a simple pricing model. It makes monthly costing for potential customers easier, which also simplifies your sales. With a per-user pricing model, you can also scale as the number of users increases. If you double the users of a product in a company, it means you will increase your revenue.
Disadvantages of per-user pricing
This pricing model sometimes allows companies to cheat by sharing the logins of multiple team members.
It also helps with churn. If the use of the Latest Mailing Database product within a company is restricted, it will be easier for users to abandon the software. A team with 5-10 users is more likely to churn than a company with 50 product users.
Usage-Based Pricing
You pay for product usage, not for functionality provided to users. The more they use your product, the more it costs the customer.
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Advantages of usage-based pricing
Use usage-based pricing without any upfront costs. Even the smallest businesses can use your solution knowing that if they use the product more, the price will go up.
Disadvantages of usage-based pricing
With this pricing model, it's hard to predict and scale your revenue. Billing amounts vary from month to month, which can make the entire income forecasting and budgeting job more difficult.