+30% MRR increase. 87% of customers migrated from the cheapest plan to higher tiers. 0% churn increase. And it all started because a CEO had a pricing plan - but wanted to make sure it was the right one before pulling the trigger.
LiveSession is a fantastic analytics software that helps you analyze users’ behavior, improve UX, find bugs, and increase conversion rates using session replays and event-based product analytics. We know many tools, but we reckon it is one of the best in this market segment. There are session replays, click and heat maps, and funnels among its core features. The UX is outstanding, and customer support is best-in-class.
By optimizing their pricing strategy, LiveSession gained a competitive advantage in the crowded analytics market, allowing them to stand out and outperform competitors.
"What we have introduced with your help had positive impact. Increasing the prices and migrating some customers to higher plans accounts for roughly 30% of the MRR increase. The migration rate of 87% indicates that the previous price of our cheapest plan was not in line with the value that customers see. We have increased the ARPU and managed to add some more MRR at the new price. We aim to abandon the lowest plan as we see we can position ourselves as a more premium product. We will do more pricing initiatives in the future. Thank you for your work – your analyses helped me make the right decisions regarding pricing and client up-sell."
LiveSession approached Valueships with something we don’t always see - they already had a thorough pricing change plan ready. They didn’t need us to build a strategy from scratch. They needed a SaaS pricing consultant to critically assess the plan, stress-test it, and make sure it was safe to implement.
And that caution made perfect sense. Being a good, UX-friendly, and functional product didn’t automatically translate to the MRR potential of the company. The initial hypothesis suggested that the value was substantially higher than the asking price - a pattern we see often in B2B SaaS pricing, where founders undervalue their own product.
However, LiveSession operates in a highly competitive product category, so the challenge was not trivial. Raise prices too aggressively and you push customers to alternatives. Don’t raise them enough and you leave significant revenue on the table. Setting a competitive price was essential to attract and retain customers in this environment. Market research was crucial for understanding the competitive landscape and informing the pricing decision. The question wasn’t whether to increase prices - it was how to raise SaaS prices without losing customers in a crowded market.
The main objective was to positively impact ARPU with changes in service pricing without losing the competitive positioning. The goal was to increase ARPU across the existing customer base while also supporting customer acquisition and retention in a competitive market. In short: figure out how to increase ARPU while staying competitive in one of the most contested segments in B2B analytics.
We began with our revenue engine diagnostics - a deep dive into internal client data to understand the current state of the business. This process involved analyzing customer data and segmenting customers to identify pricing gaps, customer behavior patterns, and plan distribution. By leveraging customer data, we were able to tailor our approach and optimize revenue strategies. Implementing unit economics allowed us to track profitability by individual customer and identify unprofitable offerings.
The data confirmed what the CEO suspected: the cheapest plan was significantly underpriced relative to the value customers were getting from it. Customers on the lowest tier were getting an outstanding product at a price that didn’t reflect its worth. That’s a classic SaaS pricing strategy misalignment - and also an opportunity.
Next, we ran a thorough competition scan. We analyzed the competitive space to understand where LiveSession stood relative to its peers - not just on price, but on perceived value. As part of this benchmarking process, we also analyzed competitor profit margins to ensure our pricing would support sustainable growth and competitiveness. Traditional approaches like cost plus pricing and cost plus pricing cost were considered, but we found them less effective for SaaS products since they do not account for perceived value or customer willingness to pay.
What we found was a strong signal. LiveSession had a very good NPS compared to the overall perceived value ratio and ROI payback of the product. We use this at Valueships as a reliable indicator of price increase potential. When customers rate your product highly and the value-to-price ratio is tilted heavily in their favor, it means there’s room to move. The question is how much - and that’s where scenario planning comes in.
This is where we added the most value. Rather than just saying “yes, raise prices,” we built detailed scenarios modeling different price points, migration paths, and churn outcomes. As part of this process, we conducted customer pricing research to understand how different customers assign value to features and outcomes. Scenario planning included modeling different pricing models and comparing them to other pricing models in the market, such as tiered, subscription-based, and usage-based approaches. Each scenario gave LiveSession’s leadership a clear view of what to expect - best case, base case, and conservative.
The scenario planning was critical because it turned a gut-feeling decision into a data-backed one. LiveSession’s CEO didn’t just raise prices - he knew exactly what the likely outcomes were before making the move. That’s the difference between a value-based pricing strategy and a hopeful guess.
We also validated the specific plan structure changes - including the migration path from the cheapest plan to higher tiers. The 87% migration rate that followed proved that the pricing of the lowest plan was genuinely out of line with the value customers perceived. They weren’t resistant to paying more. They just hadn’t been asked.
The results confirmed everything our analysis predicted - and they carry a powerful lesson: sometimes the biggest pricing wins come not from building something new, but from validating and de-risking a plan that’s already on the table.
The 87% migration rate is particularly telling. When nearly 9 out of 10 customers on your cheapest plan willingly move to a higher tier, it means the previous price wasn’t just low - it was misaligned with how customers actually valued the product. The new pricing was perceived as a fair price by existing customers, resulting in high customer satisfaction and fostering customer loyalty. This positive response from existing customers demonstrates the importance of balancing value and affordability. LiveSession is now positioning itself as a more premium product and plans to eventually phase out the lowest plan entirely. That’s a strategic shift that started with pricing and will reshape the entire business.
Strong Net Revenue Retention (NRR) - ideally 110% or higher - further indicates that revenue from existing customers is growing after accounting for churn, supporting long-term business success.
In the fast-evolving world of SaaS, choosing the right pricing model is crucial for business success. The most popular SaaS pricing models are designed to align with customer needs, maximize perceived value, and support sustainable growth. Here’s a look at the most widely used pricing structures among SaaS companies - and how they can help you serve different customer segments while optimizing revenue.
1. Tiered Pricing ModelThe tiered pricing model is one of the most popular pricing models in SaaS. It offers multiple pricing tiers, each with its own set of features and support levels. This approach allows SaaS companies to cater to a broad target market, from startups needing basic functionality to enterprise customers requiring advanced features. By structuring pricing tiers around customer needs and usage, businesses can encourage upgrades and increase customer lifetime value, all while keeping the pricing structure simple and transparent.
2. Usage-Based Pricing ModelUsage based pricing charges customers according to how much they actually use the product - whether that’s the number of active users, data processed, or another relevant metric. This model is especially attractive to customers who want to pay only for what they use, and it can help SaaS businesses align revenue with customer value. Usage based pricing models are also effective for attracting new customers who may be hesitant to commit to higher price points before seeing the value.
3. Flat Rate Pricing ModelFlat rate pricing offers a single, fixed price for access to all features, regardless of usage or company size. This model is straightforward and easy for potential customers to understand, making it a good fit for SaaS businesses targeting smaller companies or those looking to keep their pricing page simple. However, flat rate pricing can sometimes limit revenue potential from larger or more active customers who would be willing to pay more for additional features or higher usage.
4. Per User Pricing ModelPer user pricing is a classic SaaS pricing model where customers pay a set amount for each user or seat. This model scales directly with the size of the customer’s team and is easy to explain and manage. It’s particularly effective for B2B SaaS companies serving organizations with varying team sizes, and it helps align pricing with customer growth.
5. Value Based Pricing ModelValue based pricing focuses on charging customers according to the value they perceive and receive from the product. Instead of basing prices on production costs or competitor pricing, this approach uses customer feedback and data to set price points that reflect the true impact of the software on the customer’s business. Value based pricing strategies can help SaaS companies capture more value from loyal customers and differentiate themselves in a crowded market.
We ran a focused SaaS pricing optimization engagement - designed to validate and strengthen LiveSession’s existing plan, not to replace it. By analyzing customer data and applying customer segmentation, we ensured the pricing plan was tailored to different customer needs and behaviors. The engagement leveraged proven SaaS pricing strategies to optimize outcomes. Here’s what we did.
+30% MRR increase
+87% upsell rate from the cheapest to the higher plan
0% churn increase
4 weeks time-to-market
1 Engagement Manager + Data Analyst:
Certified expert in price, revenue and margin management in B2B companies and e-commerce. Member of the prestigious Professional Pricing Society. At Valueships, he is responsible for the implementation of consulting projects and taking care of the profitability of clients. Prior to joining Valueships, he worked at McKinsey & Company in the area of pricing and strategy.
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Certified expert in price, revenue and margin management in B2B companies and e-commerce. Member of the prestigious Professional Pricing Society. At Valueships, he is responsible for the implementation of consulting projects and taking care of the profitability of clients. Prior to joining Valueships, he worked at McKinsey & Company in the area of pricing and strategy.
