Q&A: "Do I have to sell as a SAAS?"

SaaS — software as a service — is the most common revenue model for the tools we use every day. There's a good reason it's so popular. But is it the only way? That's what today's listener wants to know.

Hi Chris, this is Diana from Columbus, and I've been listening to the show since episode #1! I'm starting an online service and am wondering about my pricing. As you probably know, over the past few years the SAAS model — software as a service — has become increasingly common, where the pricing is always monthly or annually instead of just paying a one-time fee. But I'm put off by the idea of forcing people to get another subscription. It seems like it's harder to convince people to commit to that instead of just paying a one-time fee. Don't get me wrong, I like the idea of recurring revenue — I just think that maybe I should go the other way when everyone else seems to be doing the same thing. What are your thoughts on this?

First, keep in mind why companies price this way: it works. Recurring revenue lets you depend less on any single period and forecast far into the future. For a lot of businesses, that's a good decision.

But it's not the only option. The core tradeoff is simple: subscriptions optimize for predictable, ongoing revenue, while one-time pricing optimizes for ease of purchase and lower resistance. Subscriptions fit when the value is continuous — something people use regularly and would miss if it disappeared. One-time pricing fits when the outcome is finite and clear: "I pay, I get the result, I'm done."

There are also hybrids that sidestep subscription fatigue: a one-time purchase with optional paid upgrades, a low-cost entry product plus a higher-tier subscription, usage-based pricing, or a premium "lifetime deal" for early adopters. Start with how customers actually experience value — and if you're unsure, you can test one model against another.

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