Ryan from Schematic shows how paid add-ons boost revenue by testing price changes, monetizing popular features, and letting customers buy up incrementally. PostHog uses just two core plans plus four add-ons. He walks through creating a $50/month Salesforce Integration add-on in Schematic's product catalog.
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Hi, I'm Ryan, a developer at Schematic. We help a lot of companies figure out the right pricing and packaging for their product. And one thing that we think is really important are add-ons and how add-ons support the overall pricing and packaging strategy. There are a lot of great ways to use add-ons to support your pricing and packaging. The first way is to use add-ons as a way to test pricing changes. If you're thinking about taking a feature and dropping it down a tier, first make it a paid add-on to that lower tier and see how many customers opt into using it. If it's really popular, you know that that might be an important consideration in future packaging and pricing changes. Next, if you have a feature that's either really high margin or often requested from your customers, making it a paid add-on is a great way to allow more of your customers to opt into it. This could either be something added on monthly to a plan, um, like additional support, or a one-time purchase like white glove onboarding, where maybe you help set up the customer's environment for them. Finally, add-ons are a great way to bridge customers into higher tiers, but at a pace that's more comfortable to them. Maybe they want a little more than their current plan provides but aren't ready to go all the way to the next level. An add-on is a great way to allow them to opt into some of the features of that higher level plan and for you to drive a little more revenue until they're ready to upgrade all the way to the next level. There's a lot of companies using add-ons really effectively right now, and one that I want to call out is PostHawk. PostHog has only 2 core plans, yet they have 4 different add-ons that allow customers to determine which parts of the product are most appropriate to them and then use those parts effectively. In Schematic, setting up add-ons is really easy. Within the product catalog, there's an add-ons tab, and from here we can create a new add-on. Let's make a copy of our Salesforce integration to show how that works. We're going to click create add-on and give it a name. We'll call it Salesforce Integration 2. These names need to be unique. And then we want this to be a paid recurring add-on, so this is going to be billed along with their existing plan. We'll say this is only going to be, uh, $50 and can only be billed monthly. We'll click save. Um, from here, an add-on is kind of like a plan in which it has features associated with it. So we will add in the Salesforce integration feature. We'll click save. And now if you buy this add-on, you'll also get access to Salesforce integration. Finally, within the product catalog, we'll add this as a live add-on. And this means that as customers are going through the payment, they'll be able to select this add-on to add it to their existing plans. Click Save and click Save Changes. And now anytime a customer is checking out, they can add the Salesforce integration to their existing plan to get access to this feature. And that's add-ons, a really powerful way to enrich your pricing and packaging that Schematic makes quick and easy. Thanks.
