Glossary > Captive Pricing
Captive Pricing
Captive pricing is a pricing strategy where a company offers a product or service at a low price point to attract customers and then increases the price once customers become dependent on the product or service. This is often referred to as “lock-in” pricing, as customers become locked into using the product or service due to the difficulty of switching to a competitor.
Captive pricing is effective in the SaaS industry because many SaaS products require a significant investment of time and resources to learn and integrate into a company’s workflows. Once customers have invested in a product and integrated it into their business processes, the cost of switching to a competitor can be high, making them more likely to continue using the product despite price increases.
Captive pricing can be risky for SaaS companies if customers feel they are being taken advantage of or if the price increases are too steep. This can lead to customer churn and damage the company’s reputation.
Ready to learn more about CloudBlue?
CloudBlue is a powerful XaaS platform that will help you grow revenue. Here are some resources for more information:
Subscription and Billing Management
Our flexible subscription and billing solution can handle the most complex XaaS business models – and scale recurring revenue.
Partner and Channel Management
Cut through complexity and see more revenue from your channel business as you easily onboard and enable resellers across the globe – at scale.
Vendor and Product Information Management
Centralize all of your vendor and supplier contracts and streamlined product information on one platform.
Ready to
get started?
Sign up or talk with a CloudBlue
expert today to get started.
