Klaviyo's CEO explains the shift from charging per email sent to pricing based on the revenue each message generates. The company invested in attribution tools that measure response rates and customer spend, letting them charge for actual growth instead of volume.
Chapters
How do you anchor around sort of known pricing points in the industry? What we felt was different was we actually invested a lot in not just adding in like personalization, but also in doing the attribution side of helping you figure out what worked. So it was, I think about it, it was almost like the cost-based model, which is what like email had become. And we wanted to flip it to a value-based model. Yep. So if we felt like if we could say, hey, the value of the, you know, the message you just sent, was, I don't know, it was a dollar, right? Because I don't know, on average, you send it to 100 people and 20% of them respond to it. And on average, they spend X dollars. If you could do the math and do the attribution correctly, we felt like you could change the whole calculus because at the end of the day, what people were really after was growth. And that was actually the big