Add-on 1#
The core offering is priced competitively, but there are numerous extras that drive the final price up. In the end, the costumer pays more than he or she initially assumed. Customers benefit from a variable offer, which they can adapt to their specific needs.
Examples: Iconic Cases
How they do it: Via AppExchange, its platform featuring third-party applications, customers of Salesforce do not only pay for the core offering of the Salesforce software suite, but may opt to purchase access to additional software solutions. These add-ons are created by third-party companies and may be integrated seamlessly into a Salesforce instance.
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How they do it: The Sega Dreamcast was launched in 1999 for the price of $199, and video games for the Dreamcast were sold for $50-$70. With any customer owning on average multiple games, this resulted in recurring add-on revenues for Sega.
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How they do it: Customers are able to purchase SAP’s core software offerings for a competitive price. After signing a contract, customers are encouraged to purchase add-on products (e.g. CRM system) to leverage the full potential of the SAP software suite.
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How they do it: With Ryanair, a standard airfare might be advertised to a customer for as low as $50. But the base fare is complemented with a host of add-on offerings. Reserving a seat will be charged to the customer for $16. Customers checking a bag will face a $25 surcharge. From travellers who forget to print the boarding pass at home, $95 is collected at the airport before boarding. These add-on services amount to roughly one quarter of Ryanairs revenue.
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How they do it: The customer gets free ”credits” in the beginning to set up their cloud computing structure on AWS. Once these credits are used up and the customer has needs more server capacities, he can flexibly use as much server capacity as he needs and is billed accordingly.
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Below, the top industries for the pattern "Add-on" are displayed, in order to get insights into how this pattern is applied across different industries. We've collected data from 5 firms using this pattern.
Top Industries
50% of firms using pattern
6% of firms using pattern
3% of firms using pattern
All Industries
Below, the pattern "Add-on" is analyzed based on co-occurrence, in order to get insights into how this business model pattern is applied in combination with other patterns within the firms we studied.
Top Co-Occurrences
4 pattern co-occurrences
3 pattern co-occurrences
3 pattern co-occurrences