SaaS Backwards Episode 161 - Is User-Based Pricing Dead? How AI Is Reshaping SaaS Monetization

Guest: James D. Wilton, Founder & Managing Partner of Monevate

The advent of AI is forcing a complete rethink of traditional SaaS pricing—particularly the long-standing dominance of user-based pricing. 

In this episode, pricing strategist James Wilton explains why AI-native products are undermining the foundations of per-seat pricing models. 

Unlike traditional SaaS, where users are the proxy for value, AI tools often perform tasks autonomously, disconnecting cost from usage in unpredictable ways. 

As a result, the most value-aligned and sustainable pricing approach for AI-powered platforms is shifting toward usage-based models. 

Wilton argues: "If you’re still defaulting to user-based pricing, you’d better be ready to defend it."

📌 Other Takeaways:

• Misaligned Incentives in AI Pricing
  With AI, the metric that drives cost (compute) is often not the same as the metric that reflects customer value—creating tension between profitability and value-based pricing.
• The Rise of Usage-Based Pricing
  As automation and AI reduce the need for additional users, user-based pricing loses its relevance. Usage-based models offer better alignment with customer value and revenue scalability.
• Customer Expectations Are Changing
  Enterprises prioritize cost predictability. Even in AI-native environments, buyers want fixed pricing or capped usage tiers to maintain budget certainty.
• Real-World Example: Help Scout’s Pivot
  Wilton shares a case study on Help Scout’s move from per-user to “contacts helped” pricing. The shift improved customer satisfaction, better aligned with value delivered, and even offered greater revenue predictability.

Watch the episode video here.

📚 James Wilton’s Book:
Capturing Value: The Definitive Guide to Transforming SaaS Pricing
Get the blueprint for designing pricing that drives both growth and profitability without shortchanging strategy.

Other resources to check out:

Interview with Vinay Bhagat, Founder and CEO of TrustRadius who publishes a yearly report about how B2B buyer behavior is changing.

The Lead Gen Mistake I Guarantee You’re Making – how to create content that better identifies intent from today’s b2b buyer.

And, if you want an outside look at your content with actionable advice, take advantage of our Content Audit. Valued at $20K in free consulting