Excerpt from a December 19, 2023 YouTube interview where Klaviyo’s CEO discusses flipping pricing from a cost-based (email-style) model to a value-based model. The CEO emphasizes investment in personalization and attribution to demonstrate customer value and justify pricing, contrasting industry-standard cost-based pricing.
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 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 sense was I don't know it was a dollar right. Because I don't know on average, you know you send it to 100 people and like 20% of them respond to it and on average they spent you know, X dollars. Like if you could do the math and do the attribution correctly we felt like that could, you could change the whole calculus because the end of the day what people were really after was growth and that was actually the, I don't know that was the biggest.
