Should you always offer a monthly plan… or can you go straight to annual?
Hey PH! I'm a bit obsessed with Pricing, and just started testing a new experiment for my startup, @Pretty Prompt:
Remove the monthly tier; offer only Free or Yearly (basically no monthly plan available).
We decided to do this after doing some simple maths and seeing that 42% of users today choose annual vs our monthly plan.
So what if I can take out the monthly option entirely?
Has anyone here done something similar or has experience with this?
I think a big part of PMF is also a different type of PMF (aka Pricing Market Fit).
Does removing monthly pricing hurt conversion… or actually make pricing clearer and push more users toward longer commitment?
So then I did a bit of research:
@Screen Studio
Monthly + heavily discounted annual ($29/mo vs $9/mo billed annually). Clear push toward yearly. And no Free option. (BTW I LOVE THIS PRODUCT. I use it ~3/week and it's one I always recommend to others.)Send.co
Free or $20/user/month. No annual plan. Super simple, low cognitive load.Fin (Intercom)
Pay-per-outcome (~$0.99 per resolution). You only pay for value delivered, but costs can be harder to predict. I don't know how I'd feel as a founder implementing this today. Given that more people can ask more questions (cos form a user perspective, we all ask AI stuff all the time), I can only see this going up.@Basecamp
If you want unlimited, it's a flat $299/month billed annually. Whether you're a small startup or an enterprise, they will never charge you more than that. (And they make it clear you get direct access to the CEO -> a great, great push for yearly).
Open to another pair of eyes! If you were designing SaaS pricing today, would you still include monthly billing by default, or less is more?
Replies
hello @ilaiszp I’d probably keep monthly unless the product is already very easy to trust before paying. Annual plans usually improve retention and cash flow, but monthly lowers the commitment barrier and can protect conversion — especially for newer products still earning confidence.
That said, with 42% already choosing annual, this is absolutely worth testing. I’d compare not just checkout conversion, but activation, refund rate, and 60–90 day revenue per visitor before deciding. Pricing-market fit is very real. 👀
42% of people are already opting for the plan, which is a pretty honest answer. The data is actually telling us something before we even run the test.
The only risk here is losing some buyers who can't commit upfront like early-stage companies or those who need sign-off. They don't just vanish; they find a competitor that offers a plan.
Screen Studios' approach seems like a middle ground. Monthly plans technically exist. The numbers make the annual plan the obvious choice.