Subscription Pricing Calculator
Calculate optimal subscription pricing tiers to maximize MRR. Model monthly vs annual pricing, trial conversion economics, and the impact of discount depth on annual revenue.
📊 SaaS & Subscriptions💼 Annual Revenue = Monthly Subscribers × MRR + Annual Subscribers × ARR
Monthly price ($)
Annual price (e.g. 2 months free)
Number of monthly subscribers
Number of annual subscribers
Please enter valid values.
Formula & Reference
| Variable | Formula | Units |
|---|---|---|
| Subscription Pricing Calculator | Annual Revenue = Monthly Subscribers × MRR + Annual Subscribers × ARR | $/year |
Step-by-Step Examples
Example 1
SaaS Tool
$29/month or $290/year (2 months free), 200 monthly + 100 annual.
- Monthly MRR: 200×$29 = $5,800
- Annual MRR contribution: 100×($290/12) = $2,417
- Total MRR: $8,217 | ARR: $98,604
- Annual plan discount: 16.7%
✓ $8,217 MRR, $98,604 ARR
Example 2
B2B Software
$99/month or $990/year, 50 monthly + 150 annual.
- Monthly: 50×$99 = $4,950
- Annual: 150×$82.50/mo = $12,375
- MRR: $17,325 | ARR: $207,900
✓ $17,325 MRR, $207,900 ARR
Example 3
Newsletter
$10/month or $100/year, 500 monthly + 200 annual.
- Monthly: $5,000 | Annual: $1,667/mo
- MRR: $6,667 | ARR: $80,000
✓ $6,667 MRR, $80,000 ARR
Real-World Applications
SaaS Companies
Model revenue under different pricing structures and subscriber mixes.
Investor Metrics
ARR and MRR are the primary valuation metrics for subscription businesses.
App Developers
Optimize IAP (in-app purchase) subscription tiers and annual plan discounts.
Startup Planning
Project subscription revenue growth for financial models and fundraising.
Common Mistakes to Avoid
⚠️
Ignoring churn in revenue projections
Subscriber counts change monthly due to churn. Revenue projections should account for churn rate, not assume constant subscriber count.
⚠️
Setting annual discount too high
Over 30% discount on annual plans reduces immediate cash flow impact. Standard is 15–25% (1–2 months free).
⚠️
Offering too many tiers
Research shows 3 tiers is optimal (Goldilocks principle). More than 4 tiers creates decision paralysis.
Frequently Asked Questions
What annual discount should I offer? ▾
15–25% is standard (1–2 months free). Less than 10% doesn't incentivize annual commitment. More than 30% may signal pricing insecurity.
What's the right number of pricing tiers? ▾
Three tiers works best: Free or low-cost entry, mid-tier (often most purchased), and premium enterprise. The middle tier is the anchor.
Should I show monthly price for annual plans? ▾
Yes — showing $24/month (billed $290/year) increases annual conversions because monthly feels affordable, even though it's an annual commitment.
What is MRR normalization for annual plans? ▾
Divide the annual payment by 12 to get the monthly contribution, allowing fair comparison between monthly and annual subscribers in your MRR metric.
When should I raise prices? ▾
When customer acquisition is strong, churn is below 3% monthly, and NPS is high. Annual price increases of 5–15% on existing customers are common in healthy SaaS businesses.