Pricing model
Pay-what-you-want pricing model
Pay-what-you-want pricing lets the customer choose any price above a minimum (or zero). It is an unusual model with narrow fit — works for indie creators with strong audience, fails for most commercial SaaS. Honest analysis below.
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How the model works
Customer chooses what to pay. Minimum is usually zero or $1. Some implementations suggest an average or default value. Revenue depends entirely on customer goodwill and the perceived value-to-cost ratio.
Best for
Indie creators with audiences who already feel a relationship (e.g., creator products to a newsletter list). One-time digital downloads where marginal cost is zero. Goodwill-driven sales with no expansion-revenue path.
Worst for
Commercial SaaS with infrastructure cost. B2B sales where the customer is a buyer, not an audience-member. Products requiring sustained service or support.
Unit-economics implications
- Mean payment is usually 30-60% of the suggested price.
- Distribution is bimodal — many at the minimum, a few at large amounts. The few cover the many.
- Conversion rate is often higher than at fixed price (lower friction); revenue per visitor is usually lower.
- Support cost per dollar of revenue is very high (free-tier dynamics apply).
Common implementation mistakes
- Using PWYW without an audience relationship. The whole model depends on a sense of goodwill; cold traffic produces near-zero average payment.
- Not suggesting an average or default. Customers do not know what is reasonable; defaults to very low.
- PWYW on a recurring product. Recurring PWYW erodes trust as customers wonder what the 'right' amount is each month.
- Skipping the goodwill-build before launch. Many PWYW launches fail because there was no relationship to draw on.
Positioning trap to watch
PWYW often hides 'I do not know what this is worth and I am hoping customers will tell me'. That is a positioning problem, not a pricing problem. Decide what the offer is worth before letting customers tell you.
Frequently asked
- Is PWYW worth trying for indie SaaS?
- Almost never as a long-term model. Sometimes valuable as a launch experiment to test demand at scale before locking in a price. Not a sustainable revenue model for commercial SaaS.
Other pricing models
Diagnose the page, then pick the model
Pricing model is downstream of positioning. The free diagnostic labels which Brunson failure mode your page hits; the right pricing model follows from the positioning.