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Innovative Solutions to Optimize Pricing Models and Improve Customer Retention

SaaS Sunday (#3)

Good morning squad,

As more layoffs keep coming our way and customers tighten their SaaS spend, companies are turning to innovative solutions to improve customer retention and optimize their pricing models, which we cover in this today's newsletter. Also, we might need better HR SaaS solutions.

⌛️ Summary of This Week's Digest

  • 🤝 Amberflo revolutionizes SaaS pricing with granular usage tracking, boosting Product-Led Growth and customer retention

  • 💣 Unlock the secret sauce to 80% more effective influencer campaigns with Klug, the B2B software platform taking the marketing world by storm

  • 🗿 Twitter’s block of third-party clients and APIs limits user choice and customization, and marks a change in the company’s relationship with developers

  • 💸 Funding Rounds: Vyalitics ($10m), ThriveCart ($35m), Beaconstac ($25m)

⬇️ The Full Meal

Amberflo to Revolutionize SaaS Pricing with Metered Usage Model

  • Amberflo is a startup that aims to change the way SaaS products are priced and power the transition to usage-based pricing models.

  • The company’s founder and CEO, Puneet Gupta, came up with the idea for Amberflo while working at AWS from 2011-2014 and saw the benefits of metered usage model first-hand.

  • Amberflo's metering solution allows companies to track usage at a granular level, down to every transaction, API call, or resource used.

  • A metered usage model offers certain benefits for companies:

    • (1) it provides the data required to price their product accurately, compared to a subscription tier or seat licenses.

    • (2) it allows them to continue working with customers who may otherwise churn, by giving them the option to dial back usage instead of unsubscribing.

  • Read more about it here.

⚡️ Power Take:

  • A metering service like Amberflo’s should be particularly attractive for companies using a Product-Led Growth (PLG) strategy (e.g. Dropbox, Slack, Zoom), as it would allow them to align the cost of the product to the value received by the customer.

  • With usage-based pricing, customers only pay for what they use and thus, are more likely to be willing to try the product and use it more.

  • Examples of companies that have successfully implemented usage-based pricing models include Twilio, Digital Ocean, and Message Bird.

Note: "PLG" is a business strategy that focuses on creating a product that is so valuable to customers that it generates organic word-of-mouth promotion and viral growth. In other words, the product is the primary driver of growth, rather than traditional sales or marketing tactics.

Klug: The Secret Sauce for 80% More Effective Influencer Campaigns

  • Klug is a B2B software platform that aims to improve the performance of influencer marketing campaigns by up to 80%.

  • The platform has already started gaining traction globally and has added various Indian D2C and institutional brands, as well as global agencies like WPP, as clients.

  • Not their first-time rodeo: Before Klug, the founders had a successful digital marketing agency, Social Catalyzers, which specialized in promoting brand awareness and viral content. They also focused on developing technology for influencer campaigns.

  • How does it work? Klug's analytics tool allows marketers to track performance, forecast revenue and monitor campaigns. The platform’s algorithms, which rely on machine learning, can predict and analyze campaign success with an accuracy rate of over 85%. The AI component is mainly used for image and audio recognition.

  • Klug is currently available on Instagram, YouTube, and TikTok and is planning to expand its reach to Twitch, Facebook, and Twitter in the near future.

  • Read more about it here.

⚡️ Power Take:

  • Venture capitalists are showing growing interest in the creator economy by investing in startups that offer services to content creators such as monetization tools and business management solutions

  • As of July 2022, venture-backed startups in the content creator space had reached $637 million in funding, on pace to surpass 2021’s record of $939 million.

Twitter's War on Third-Party Clients

  • Twitterrific, a popular third-party Twitter client, has removed its iOS and Mac apps from the App Store.

  • The company that made Twitterrific, Iconfactory, cited Twitter's recent actions under Elon Musk's management as the reason for ending their association with the social media network.

  • Twitter has been intentionally blocking third-party clients without explanation and recently updated its developer terms to prohibit the use of its APIs to create substitute products or services.

  • Many other apps, including Tweetbot, are also removing or preparing to remove their apps from different app stores.

  • Twitter's move is believed to be an attempt to exert control over its users and force them to use their in-house services.

  • Read more about it here.

⚡️ Power Take:

  • Twitter’s decision to discontinue support for third-party apps like Twitterrific may come as a disappointment, especially as these apps have played a significant role in shaping the platform, adding features like the iconic bird logo, character count, and conversation threads.

  • The discontinuation of third-party Twitter apps may impact user experience and engagement on the platform as many have come to rely on these apps for their unique features and functionality. Ultimately, this may lead to decreased user satisfaction and retention.

💸 Funding Rounds

  • Vyalitics | $10m: the company’s software automatically collects and analyzes the condition data needed for regular maintenance and upkeep of roads (link)

  • ThriveCart | $35m: the company provides a powerful platform for building cart pages, sales funnels, and managing sales performance (link)

  • Beaconstac | $25m: the company connects physical products and places to consumers through QR codes (link)

👋 That is all for this week -- thank you for reading!

Keep an eye out for next week’s update for more software news and insights.

💬 If you have any feedback or suggestions for future topics, please don’t hesitate to reach out. Follow me on Twitter to stay in touch.