Table 34 Sept 2026From “What is tiered pricing?”

How do you audit your own packaging?

Table 3How do you audit your own packaging?

Audit Dimension	Exemplary Practice (2 Points)	Acceptable Baseline (1 Point)	Critical Deficiency (0 Points)
1. Public Tier Count	Strictly three core tiers (Good-Better-Best) plus modular add-ons	Four tiers with clear target segment definitions	Five or more tiers causing buyer confusion and decision paralysis
2. Customer Distribution	Balanced self-selection: 20-35% Good, 45-60% Better, 15-25% Best	More than 75% of accounts clumped in a single tier	Over 90% of customers stuck in entry tier; higher tiers fail to sell
3. Fence Integrity	Enterprise compliance and security strictly fenced; zero leakage	Occasional feature leakage mitigated by sales discounting rules	Core enterprise capabilities freely available in low-priced tiers
4. Identity & SSO Policy	Basic SSO in mid-tier; SCIM and audit logging reserved for Enterprise	SSO in Enterprise tier, but discounted for security-conscious SMBs	Rigid SSO Wall forcing 5x price jumps solely for authentication
5. Value Metric Coupling	Each tier incorporates a scalable usage metric driving intra-tier expansion	Tiers are purely flat-rate, requiring manual tier jumps to expand	Misaligned value metric that discourages customer product usage
6. Reference Anchoring	Top tier actively anchors perceived value of mid-tier revenue workhorse	Visual hierarchy exists, but middle tier is not clearly highlighted	All tiers presented with equal weight; no cognitive anchor
7. Feature Hostage Audit	Every tier delivers an uncompromised, complete core workflow	Minor convenience features gated, causing occasional support friction	Critical utility features (export, search) held hostage in top tier
8. Grandfathering Governance	Clear contractual sunset clauses; max 12-month transition glide path	Grandfathered accounts reviewed annually on an ad-hoc basis	Uncapped, permanent grandfathering paralyzing billing and revenue
9. Sales Discounting Guardrails	Strict discount authority matrix tied directly to package tiers	Manager approval required for discounts exceeding standard limits	Account executives freely discount premium tiers to hit quota
10. Downgrade Velocity	Quarterly downgrade revenue represents less than 1.5% of total ARR	Downgrades monitored, but root cause analysis is inconsistent	High downgrade velocity indicating porous, unstable tier fences

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Source: Table from this essay. Sources and interpretation are given in the article.

PNG4:3, 1600 × 1200, with the title, the source line and the attribution set in the image isoglu-2026-what-is-tiered-pricing-fig04.png

From the essay

Pricing & revenue architecture

What is tiered pricing?

Tiered pricing bundles features into distinct packages with clear boundaries. Design fences that prevent downgrades and protect willingness to pay.

4 Sept 2026

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APA 7

Isoglu, S. (2026). How do you audit your own packaging? [Table]. isoglu.com. https://isoglu.com/insights/exhibits/isoglu-2026-what-is-tiered-pricing-fig04/

BibTeX

@misc{isoglu-2026-what-is-tiered-pricing-fig04,
  author = {Isoglu, Sinan},
  title = {{How do you audit your own packaging?}},
  year = {2026},
  howpublished = {Table 3, isoglu.com},
  url = {https://isoglu.com/insights/exhibits/isoglu-2026-what-is-tiered-pricing-fig04/},
  note = {From the essay {What is tiered pricing?}}
}

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