Retention Base Pricing

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The idea of retention base pricing stemmed from the observation that a lot of businesses focus more on getting new customers and rewarding them, verses retaining existing customers. Imagine if instead of ne flix being 12 dollars a month throughout the whole course of a subscription, it started at le say, 18, and then it went down to eight dollars a month where every month it reduced in price by a dollar. So it's rewarding people who have been around for longer. And it also could reduce churn by people being locked in at a certain price.

In this episode, Cal and Steph discuss the subjective nature of pricing. They explore how a value extends beyond utility or the physical nature of an asset (think luxury items, NFTs, etc) and use these ideas to explore new pricing models, including tiered, retention-based, and completion-based pricing.

They also explore how our own psychology can inhibit use as consumers to spend on what's most meaningful and the importance of unlearning certain spending habits.

If you find the psychology of money as fascinating as we do, give this episode a listen.

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