Margin-Calibrated Discounting
Pricing ModelSales Compensation
SPP's term for the practice of engineering a smooth pricing surface that produces a targeted net price at every commitment level a customer might make, calibrated so that gross margin is the primary lever rather than revenue. The practice retires hand-set tier-step discount tables: an internal smooth net-price surface, whose slope (the rate at which discount accumulates with volume) is engineered against margin targets at every point rather than only at tier boundaries, generates the schedule customers actually see. The practice removes the cliff-edge negotiation behaviors tiered breaks invite (customers gaming the volume threshold; reps round-tripping through the next tier just to access the next discount).
Used in these articles
- Continuous Monetization: The B2B Software Pricing Discipline | SPP
- Margin-Calibrated Discounting: The Pricing Surface Software Should Have Inherited
- GitHub Copilot Pricing Change Reveals the 5-Position AI Pricing Spectrum
- From Coarse Volume Tiers to a Smooth Pricing Surface: The Artifact AI Consumption Forces