Billing Management: #6 Usage Billing in SaaS
Imagine a customer shuffling across multiple subscriptions, a streaming service, a music app, cloud storage, and a design tool. Each one charges a flat monthly fee, regardless of how much or how little they use. Some months, the customer barely opens the subscriptions, yet the bill is the same. This is what we call subscription fatigue, meaning resistance from the customer towards fixed, recurring charges that don't match their actual usage.
For SaaS, subscription fatigue is more than a buzzword. It's a business risk as a flat rate may appear overcharging for one, but others enjoy paying less for their high usage. This imbalance leads to churn, lost revenue and customer grievances.
The solution lies in usage billing, where the customer pays based on what they consume. By aligning cost with value, businesses can increase fairness and unlock sustainable growth. While the principle is simple, it requires a reliable way to track and monetise usage properly.
Zoho Billing Makes Usage Billing Seamless
Zoho Billing provides SaaS businesses with all the tools needed to implement usage-based pricing effectively. Key capabilities that Zoho Billing offers that work effectively for SaaS businesses include:
Flexible Pricing Tiers: Businesses can create multiple plans with different prices and list them on their websites for direct signup.
Zero value Plan: For charging customers purely based on usage alone, businesses can create $0 value plan and associate usage addons to charge appropriately.
Addons: Attach both flat-rated addons and usage-based addons to the subscription.
Hybrid Model: Combine a flat subscription fee with usage-based addons to monetise additional consumption fairly.
When a usage addon is attached to a subscription, Zoho Billing ensures that usage is tracked, recorded and billed accurately.
Scenario 1:
Sam runs a small consulting firm and uses a mailing application to communicate with his clients. His plan costs $200 and includes 500 GB of storage. Sam stays within the limit most months; however, with many attachments, proposals and reports during a particular month, his mailbox usage exceeds by another 100 GB. The mailing application provides a usage addon for $0.50/GB for the additional usage instead of offering a rigid higher value plan.
Item | Value |
Base Subscription | $200 |
Included Invoices | 500 |
Actual Usage | 600 |
Extra Usage | 100 |
Unit Price for Extra Usage | $0.50/GB |
Additional Charge | $50 |
Total Invoice Value (Base Price+Added Usage) | $250 |
The billing team records the extra 100 GB usage in Zoho Billing using the manual usage entry method and nothing more. The system automatically calculates $50 overage fee and appends it to the invoice to make the renewal invoice for the period $250.
Scenario 2:
Imagine Smith Enterprise uses a cloud analytics SaaS product. The contract covers a base subscription plan and two usage add-ons: API calls and storage. The base plan costs $500/month and includes 100,000 API calls and 500 GB storage. For every API call they make, an extra $0.01 per call will be charged. Similarly, for extra storage, $0.10 will be charged per GB.
During a particular month, the company consumes 250,000 API calls and 750 GB of storage, clearly above the usage limit. A subsequent invoice is created, and the charge based on the usage data is added to the base subscription value.
Addon 1 | Addon 2 | ||
Item | Value | Item | Value |
Included API Calls | 100,000 | Includes Storage | 500 GB |
Actual Usage | 250,000 | Actual Usage | 750 GB |
Extra Usage | 150,000 | Extra Usage | 250 |
Unit Price | $0.01/call | Unit Price | $0.10/GB |
Additional Charge | 150,000x$0.01= $1500 | Additional Charge | 250x$0.10= $25 |
Item | Charges |
Base Subscription | $500 |
API Call Overage | $1500 |
Storage Overage | $25 |
Total Invoice | $2025 |
The company exports the API call logs and storage usage data into a CSV file that can be imported into Zoho Billing. Zoho Billing digests both records, applies the pricing rule separately for each add-on, and generates a consolidated invoice.
Scenario 3:
Roy runs a digital marketing agency offering various marketing campaigns across social media platforms. Roy owns a SaaS application that generates posts and charges $1.5 per post design. No fixed base price for this, but their clients are purely charged based on the number of posts made. During festive sessions, Roy's team schedules a maximum of 450 posts for a client.
Item | Value |
Base Subscription | $0 |
Rate per post | $1.5 |
Actual Usage | 450 posts |
Total Invoice Value ($1.5x450) | $675 |
Using Zoho Billing, Roy records the usage manually or by importing them into the system. With no base price, the platform automatically calculates the total invoice based on the usage. Roy receives a clear invoice for $675, reflecting the value consumed.
SaaS Usage Billing Simplified
Usage Billing ensures that customers pay only for what they consume, whether extra storage, extra API calls, or purely based on the number of posts made. With Zoho Billing, SaaS businesses can seamlessly manage complex and straightforward usage billing scenarios. Adding usage to Zoho Billing is simplified through different methods. It can be added manually if there are fewer subscriptions, and usage data can be imported if there are more subscriptions and usage add-ons. Usage can also be pushed using APIs into Zoho Billing.
Post your use cases in the comments and find the best way to handle them using Zoho Billing.
Next, we will dive into Usage Billing in Telecom and Internet Service Providers, showing how this model powers those sectors. Topic Participants
Hari Hara Sudhan. S
Sticky Posts
Community Learning Series | Digest #5 — September 2020
Dear customers, We're happy to bring you the September edition of our #CommunityDigest! Keep track of your subscription KPIs right from your smartphone: Last month, we enhanced our Android mobile app to help our customers get daily updates on their business health. We got to know from a lot of customers that this has made their job much more easier because they no longer have to keep a reminder to manually check on the previous day's revenue or activations. If you have not downloaded it yet, here'sCommunity Learning Series | Digest #4 - August 2020
Dear customers, We hope you're staying safe and healthy. I'm happy to bring you the fourth edition of our #CommunityDigest with some brand-new updates from us. 1. Daily Business Updates (for Android users) The Zoho Subscriptions Android app has got a cool new update: You can now get a push notification to your smartphone that lets you know how many activations and cancellations have taken place, and what's the net revenue for the previous day. The best part is, you can tell the app when exactly youCommunity Learning Series | Digest #3 - July 2020
Dear customers, We hope you're staying safe and healthy. We're glad to bring you the July edition of our #CommunityDigest. New community members can view our previous newsletters here. This time, we have two major updates and three interesting topics for you: 1. Zoho Subscriptions Developer Community Since the inception of Zoho Subscriptions, our team believed that the recurring billing platform we provide should be able to offer an extensive API library that empowers businesses to automate mostIntroducing: Community Learning Series | Digest #1 - May 2020
Dear customers, We hope you are staying safe and healthy. Helping businesses manage their customer subscriptions more efficiently has always been, and always will be, our goal at Zoho Subscriptions. We strongly believe this is possible if we grow together as a community and share what we know with each other. To nurture this shared learning experience, here is our brand-new Community Learning Series! Welcome to the first edition of our digest! Each edition of our community digest includes guides
Recent Topics
Dependent drop-downs... how?
Good day. I have 2 different situations where I need a dependent drop-down field. First is for a subform, where I want to show related fields for a specific customer on the main form. In my case it is a parent whose children make use of our school transportReporting Limitation on Lead–Product Relation in Zoho CRM
I noticed that Zoho CRM has a default Products related list under Leads. However, when I try to create a report for Lead–Product association, I’m facing some limitations. To fix this, I’m considering adding a multi-lookup field along with a custom relatedSeries Label in the Legend
My legend reads 'Series 1' and 'Series 2'. From everything I read online, Zoho is supposed to change the data names if it's formatted correctly. I have the proper labels on the top of the columns and the right range selected. I assume it's something inDynamic Signature - Record owner
Hi everyone, I’m using Zoho Writer merge templates from Zoho CRM and have two questions: Owner signature: How can I automatically insert the CRM record owner’s signature in the merged document? I’m not sure where this signature is stored or how to referenceSet Warehouse based on Vendor
Greetings. I would like to set automaticaly the Warehouse based on the Vendor. Context: I am working on an adaptation of a Purchase Order to be used as a Quotation. I have defined that when a user has to raise a quote the Vendor will be "PROCUREMENT" I would like to set the Warehouse to a predefined value when "PROCUREMENT" is set as Vendor. I have tried to do with the Automation feature using the Field Update option, but Warehouse does not is listed as a field. Can you help? Thanks in advance.Printing from Zoho Creator hosted on my own server to printers hosted on my clients local network
Hello. Fairly new to Zoho Creator and looking for best options to be able to print from my application hosted on my own server to any printer hosted on my clients own local network. Any advice is welcome. Thank you.Add System Pre-Defined Lookup Field to Subform?
Hi there! New to using Zoho, so this may already exist, but I'm having trouble figuring it out. Is there a way to get the system pre-defined Account Lookup field (in our case, renamed to Company Name), as the starting point for a subform? In our company,Numbered / bullet point List in Zho Cliq
Hi, is there a way to format chat messages in Cliq like this Topic 1 Hey, I finished this project yesterday etc... Topic 2 I am still working on this etc...Cannot Access Subform Display Order in Deluge
As highlighted in this community post, we still have to deal with the significant limitation of not being able to access the user-sorted order of subform rows through Deluge. This creates a major disconnect between the UI capabilities and backend automation,How many groups in Zoho Mail can I make?
I'm currently on the free plan, which has a limit of 10 users. Does that limit includes groups too? If not, what is the limit for groups? Thanks!Feature Suggestion for Zoho Social: Auto-reply to Comments or Keywords
Hi Zoho team, I'd like to suggest a very specific feature that would be extremely helpful for customer engagement: the ability to automatically send a reply to comments on posts — either all comments or those containing specific keywords. For example,My domain did not activate
Hi, my domain (apsaindustrial.com.ar) did not activate, and the phone verification message never arrived. Please would you solve this problem? Thanks.Already have Zoho account. Not letting me log in
I already have a Zoho account that is associated with my Google email and my phone number. Even though I'm already logged in to Zoho, when I click on the mail icon to access my email, it takes me to the pricing page. When I click on the free option, itZOHO Mail App Not working
There seems to be an issue with Zoho Mail App today. It is not connecting to server, internet is working fine, tried uninstalling app and reinstalling, loading circle keeps spinning round. Is there an update on the way?facing error 550 5.4.6 while sending emails
Please help me fix this issueAllow Itemization for Recurring Expenses
For whatever reason, one cannot itemize a Recurring Expense. This capability should be added. The use cases to support this are largely the same as what they were to allow for itemization in Expenses. Anything that would need to be itemized for a regularZoho reply to not working. just reply to my self
Hello. i using on my wordpress website a contact form from Wsform. i can set the reply to email there. normally it works. but since i am using your wordpress plugin zoho mail it doesn`t work. its not using the reply to (email from customer). I just canPainfully Slow Zoho mail
Since yesterday Zoho Mail seems to have starting functioning very slowly and having a few bugs. It's slow to open mails, slow to send, slow to change between email accounts. Sometimes clicking on a particular folder (eg Sent folder) stops working andCan't receive any email from other platform
Hello,everyone, i'm just join zoho and create two email accounts for my own business. I was using it to get a verified email from stripe, but can't receive it. and I use my private gmail account to send test email twice, first time show below reply, butYour Incoming has been blocked and the emails will not be fetched in your Zoho account and POP Accounts
Can some on help me regarding our account . thank you so muchZoho Creator integration with Sage 50
Hi, Wondering if anyone has had any experience connecting Zoho to Sage 50 and could share any information on this matter. Thank you.Conditional Email Forwarding
How can I set conditional email forwarding of the users? For example: Mail should be forwarded to a address only if it comes from a particular sender. So, I want such email forwarding, which forwards mails based on particular conditions, like the incomingIncoming emails not appearing in Inbox
Hello, I have an issue with incoming emails sent from my website (domain: h2ostop.si). Emails are visible in the Sent folder, which means they are successfully sent through Zoho SMTP, but they never appear in my Inbox. Nothing arrives in Inbox, Spam,Automatic Matching from Bank Statements / Feeds
Is it possible to have transactions from a feed or bank statement automatically match when certain criteria are met? My use case, which is pretty broadly applicable, is e-commerce transactions for merchant services accounts (clearing accounts). In theseEmail Opt Out Question
Has the problem where if a customer is emailed opt out prevents you sending standard emails? For me this feature is simply to stop any email marketing and should not block people from receiving emails via Zoho mobile, which makes no sense.Can No Longer Access Zoho Email Accounts from iPhone or iPad Apple Mail Apps ,.
Keeps asking for password, Says ID or password incorrect. Tried creating a new app specific password. Same result. Is this possibly related to the server maintenance. Have verified all email settings, userid and password. This has worked for years untilLatest update caused issue in using marathi typingzoho
With latest update now marathi typing does Not work in zohonotebook. I preferred zoho over other because it was supporting marathi font without any distortion.. But after new update,keyborad simply does not workLogin verification emails never received.
I can't login to my account. You send a verification email, but it never arrives. This is a common problem, frequently caused by some relay point out there classifying the sender as a spammer. Is there anything I can do to bypass this? Maybe get a textGlobal lists for Multi select
It would be great if I could select a global list to use for a multi select dropdown filed.Yahoo is rejecting e-mails sent from a Zoho server
Diagnostic-Code: 4.7.0 [TSS04] Messages from 136.143.169.51 temporarily deferred due to unexpected volume or user complaints - 4.16.55.1; see https://postmaster.yahooinc.com/error-codes Remote-MTA: dns; mta5.am0.yahoodns.netYahoo blocks e-mail sent from Zoho servers
Getting this for a bunch of Yahoo addresses. Do you know if some of your servers got blacklisted? Diagnostic-Code: 4.7.0 [TSS04] Messages from 136.143.169.51 temporarily deferred due to unexpected volume or user complaints - 4.16.55.1; see https://postmaster.yahooinc.com/error-codesWorking with dates and Function Field
Hello friends! I'm trying to add days to a date, however the field function will always shows 00:00:00 after the resultant date. How can I display only the date, whithout the time? toDate(input.request_date.addDay(input.Prazo_acordado),"MM,d,yyyy") The code above will result something like "11-Feb-2020 00:00:00", but I want to display only "11-Feb-2020"What's New in Zoho Analytics - November 2025
We're thrilled to announce a significant update focused on expanding your data connectivity, enhancing visualization capabilities, and delivering a more powerful, intuitive, and performant analytics experience. Here’s a look at what’s new. Explore What'sUnable to send message;Reason:550 5.4.6 Unusual sending activity detected. Please try after sometime.
Please help my account got blocked automatically, can you help me how to avoid it? Thanks so muchUnusual activity detected from this IP. Please try again after some time
When i try to create new addresses on my account i am getting this error, it has been 24 hours now and i am still getting this error can anyone helptemporary system errorlouis
J'essaye d'envoyer des mails avec mes 2 adresses mail qe nous avons sur le compte arthur@lepunch.fr et louis@lepunch.fr mais j'ai toujours le message temporaire system error, je reçois les mails mais impossible d'en envoyer a qui que ce soitHow to Cancel/Delete Queued Mail Merge?
Hi. I just tried to do a mail merge before realizing there's a limit on number of sends. I accidentally sent one of my lists twice, and all of those emails are currently queued. Is there any way to cancel or delete a queued mail merge? Would love to beNeed to add a new admin for my domain
Hello Zoho Support, I am the owner of the domain localeistanbul.com. The current super admin account (admin@localeistanbul.com) is not accessible. I do not want to reset or delete the existing account because I need to keep all existing emails. PleasePossible Fraud Site.
Hello. I received a text with the sender's name as zoho, claiming that my account was at risk and that I should sign in at https://verify.zohomails.ru/signin to verify my account. I signed in on the web address above, and a few days later someone hackedZoho mail to Teaminbox
Hello, We're searching for new mail program. Now I'm testing a bit with zoho mail and team inbox. My findings in the research: Pop mail throught zoho mail is almost instant. Any pop or imap via external provider takes a couple minutes to 15 minutes beforeNext Page