Something Old, Something New: The History and Future of Pricing

May 22, 2023 | #Other
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Introducing The History and Future of Pricing

The future of pricing may look increasingly usage-based, but is that a break from the past or an evolution of what has gone before?

The systems that underpin UBP are more sophisticated than ever – with AI, APIs and real-time data allowing usage to be tracked and billing adjusted with ease, but the ideas behind it go back much further.

In Something Old, Something New we explore how the history of pricing has led us to this point, and the surprising continuities between the pricing models of centuries ago and the way companies do business today.

Report Highlights

In a whistlestop tour from the 17th-century publishing industry through to the contemporary software market, we will explore:

  • The early origins of the subscription model, and how what began as a method to raise funds for cultural projects grew into the system of regular payments as we know it today.
  • How the idea of a single, fixed price emerged later than we often assume, with price tags not becoming a retail fixture until the mid-19th century.
  • The emergence, with household utility bills, of the idea that a customer would pay according to how much of a service they had consumed.
  • The rebirth of dynamic pricing as the ecommerce and app economies took hold, with customers accustomed to the idea that prices would fluctuate day-to-day or depending on the time of day.
  • The concurrent rise of the SaaS model, a new twist on the old idea of subscriptions, and how it has evolved over recent years into usage- and consumption-based systems, aligning vendor and customer more than ever.

Not everything that’s novel is entirely new. Our short tour through the history of price reveals how today’s systems and tools owe something not just to modern technology, but to centuries of thinking about how businesses should charge their customers. The question of how to hit the sweet spot in which profit, trust and loyalty are all maximized is centuries old, and continues to occupy us all today.

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