SaaS Packaging and Tier Design: Build Packages That Grow With Customers

SaaS packaging is how you bundle what you sell into packages that make sense for different customers. Done well, your packaging makes it easy for customers to start, intuitive to expand, and difficult to churn. Done poorly, it creates confusion, limits adoption, and leaves revenue on the table.

Why packaging matters more than price

I have seen scale-ups spend weeks debating whether to charge 499 or 599 per month while completely ignoring how they package their product. This is optimizing the wrong thing.

Packaging determines three critical outcomes. First, who can buy: your packages define the entry point. Second, how customers grow: your packaging creates or blocks expansion paths. Third, how customers perceive value: what you include and exclude signals what you think is premium.

The price is what you charge. The packaging is what you charge for. Start with the packaging.

The three-layer pricing architecture

I use a three-layer architecture where each layer does something different for your business.

Layer 1 is the base platform license: your predictable, recurring revenue foundation. Layer 2 is add-ons and modules: your expansion layer, where customers go deeper based on their specific needs. Layer 3 is usage and consumption: your fairness layer, ensuring customers pay in proportion to the value they extract.

Each layer serves a different business purpose, and most scale-ups only operate on one of them. That single-layer approach forces all your pricing strategy into a single number, which leads to painful trade-offs you do not need to make.

The real challenge: getting the details right

Knowing the three layers exist is the easy part. The hard part is deciding what belongs in your base versus your add-ons, choosing the right usage metric, designing tiers that feel natural rather than extractive, and creating fences between segments that actually hold.

These decisions depend on your specific customer segments, your value chain, and the job your product is hired to do. Generic frameworks only get you so far.

In my upcoming book, Pricing from the Core, I walk through the full methodology for designing your packaging architecture step by step, including how to build fences, bundle features, and create expansion paths that grow revenue without growing friction. If you want to be notified when it launches, get in touch.