Generative pricing emerged as a response to the pricing requirements of second generation generative AI applications, but the five steps at the heart of the approach are generally applicable. They provide a foundation for a new approach to price optimization, one based on the value being delivered.

Sales led growth continues to be the dominant growht mption in B2B SaaS with more than 70% of SaaS companies relying on this approach. How will generative AI impact sales led growth? One place is early in the sales funnel. Sales Development Representatives (SDRs) are responsible for qualifying and prepping opportunities. Can this be done by AI?

Generative pricing will come to dominate B2B SaaS pricing over the next decade, but most companies will begin by taking small steps to get there. The five steps are to (i) build a value model, (ii) use feature flags, (iii) map features to value, (iv) design a pricing model based on the feature-value mapping, (v) have pricing define configuration (or vice versa).

How should generative AI applications be priced? We asked our community in a flash poll, here are the results and our point of view on the emerging best practices for monetization and pricing of generative AI applications.

Companies have begun to use generative AI applications to evaluate proposals. What does this mean for proposal generation and pricing? How can a value story help you score well when an AI is making recommendations?

Applications built on generative AI platforms have emerging properties and will need a new approach to pricing. Software applications are becoming composable, conversational and adaptive. Pricing needs to respond. A new approach to pricing is needed. Let’s call it generative pricing.

Certain pricing metrics are associated with AI applications. In this year’s PeakSpan Ibbaka Survey of NRR we are seeing pricing metrics associated with AI showing up in multiple verticals, a significant change from last ear.

Generative AI application monetization is still in early days. Michael Mansard from Zuora has done some hard thinking about this. He shares his insights in this Ibbaka interview.

Will generative AI apps require generative pricing? And what might generative pricing be? We asked a generative AI to get a recursive perspective on this.

A recent poll found that 40% of pricing, design and product management leaders believe that generative AI will require new approaches to pricing. What might these new approaches look like? We explore this using concept blending with the help of generative AI.

The Mark Stiving and Steven Forth webinar attracted about 500 people and there were a lot of questions asked in the chat. This is the first of a series of posts where we answer these questions.

Where are people applying generative AI solutions? Ibbaka conducted a quick linked in poll to explore this. Here are the results. Not surprisingly, improving internal business processes is the most common use of generative AI today.

The layering in of AI has led Box to adjust its pricing. What can we learn from this that will help us to price other AI powered solutions?

RAGs or Retrieval Augmented Generation archiectures are becoming a common approach to the design generative AI. They tend to require more context in the prompt changing the cost dynamics. How will this impact their pricing?

SaaS vendors are used to high operating margins where costs are a minor consideration in pricing. AI is changing this. AI is expensive to develop and to operate. Will this change pricing models?

ChatGPT was launched less than one year ago but it is already upending SaaS product architectures. Initially we saw many generative AI extensions but we are now seeing the AI as the platform. How will this impact pricing?

Open.ai’s ChatGPT has become one of the anchor points for Generative AI pricing. How are people responding to the current pricing? What should Open.ai do next?

Copilot for Microsoft 365 pricing has been out for a few weeks now. Some buyers seem to have locked onto this as a reference price for any generative AI product. How should people marketing and pricing generative AI solutions position themselves relative to or away from Copilot?

The fast-paced and ever-evolving world of AI has placed pricing at the forefront of business success. Companies are competing fiercely and adapting to the dynamic demands of customers, with AI taking center stage.

The results are in for our survey on price acceptance of generative AI productivity applications. See how much people are willing to pay.