Simpler-Fairer Pricing Reset
Deliberately give away revenue to simplify pricing — it lifts retention and restores a customer-obsessed culture.
- Difficulty
- Advanced
- Time to result
- ~months to results
- Steps
- 4
- Confidence
- 85%
Intercom's legendarily complex, disliked pricing was a symptom of an unfocused strategy trying to capture value in every direction (seats, messages, leads, tiers, gates). McCabe's fix was to pick a lane strategically and then radically simplify pricing — accepting a large short-term revenue write-down — because simpler, predictable, fairer pricing increases retention and stops internally normalizing customer-unfriendly decisions.
Origin
Eoghan McCabe on undoing Intercom's pricing, which had become a viral Twitter meme, after returning as CEO and making 'customer obsessed' a core value.
Core principles
- 01Complex pricing is usually a downstream symptom of an unfocused strategy
- 02Every direction you try to monetize adds a metric, tier, or gate — complexity compounds
- 03Simpler, more predictable, fairer pricing increases retention and ease
- 04Screwing customers on price erodes internal belief that you care, spreading to other decisions
- 05Be willing to take short-term revenue pain for the long-term relationship
How to run it
- 1
Pick a strategic lane first
Narrow the strategy so you're not 'trying to do all the things for all the people' — the sprawl is what forced pricing to charge for seats, messages, leads, and tiers simultaneously.
Pro tip Simplify pricing as a consequence of focus, not as an isolated pricing project.
- 2
Make the bold no-decisions
Kill the pricing complexity: collapse metrics, tiers, and gates into something predictable and fair even where it means saying no to captured revenue.
Watch out This requires a willingness to 'take pain in the short term for the long term' that many leaders avoid.
- 3
Accept and quantify the write-down
Reduce prices for many customers and explicitly accept the revenue hit — Intercom gave away roughly $50M in ARR to move customers to simpler pricing.
- 4
Let fairness compound into retention and culture
Simpler fair pricing makes customers stick around longer and removes the internal cognitive dissonance of 'screwing customers,' reinforcing a customer-obsessed culture.
Pro tip Tie the pricing reset to a stated value (e.g. 'customer obsessed') so the org understands why revenue was sacrificed.
In the wild
Facing viral memes mocking its pricing, Intercom picked the service lane and rebuilt pricing to be far simpler and fairer, writing down roughly $50M in ARR to move customers onto it.
→ Customers on simpler, more predictable, fairer pricing stuck around longer, created 'so much more ease' in the company, and the change reinforced the new 'customer obsessed' value.
Common mistakes
Treating pricing complexity as a pricing problem
McCabe traces the complexity to an unfocused strategy trying to monetize in every direction — fixing pricing without narrowing strategy just re-grows the behemoth.
Refusing to take short-term revenue pain
He names 'an unwillingness to make bold decisions, say no, pick a lane and take pain in the short term for the long term' as a root cause; leaders who won't write down revenue stay stuck with hated pricing.
Is it for you?
Best for
Founders of maturing SaaS businesses whose pricing has become complex and disliked as a byproduct of sprawling product scope.
Not ideal for
Early companies still discovering value metrics, or situations where a revenue write-down would be existentially unaffordable.
From the transcript
“we actually have already given away something like something like $50 million in AORA.”
“when people feel like they have far simpler, more predictable, fairer pricing, they'll stick around longer and it creates so much more ease in the…”
“When our people saw that we were screwing customers effectively in every direction, it”
“an unwillingness to frankly make bold decisions, say no, pick a lane and actually take pain in the short term for the long term”
From the episode
How Intercom rose from the ashes by betting everything on AI
Eoghan McCabe (founder and CEO)