Add-On

An add-on is a product or service that is added to a subscription extending the existing subscription. Without add-ons, you might end up defining new plan variants for each feature tier, which quickly becomes unmanageable.

#Add-on Use Cases

Add-ons are often used in self serve billing to allow customers to add additional products or services to their subscription.

Dynamic Usage Tiers For example, a customer may subscribe to a basic plan and then decide they need more storage. They can add an add-on to their subscription to get the additional storage.

Optional Feature Toggles These are add-ons that enable a particular feature set. For instance, a "Premium AI Model" add-on might enable a specific set of AI models.

Bundled Add-Ons These are add-ons that are bundled with the core product. For instance, a "Enterprise Security Add-On" might include all the enterprise security features like SSO, MFA, and audit logs.

Cross-Sell These are add-ons that are used to cross-sell other products or services. For instance, a "Premium Support" add-on might include priority support from the provider.

Seasonal or Temporary Add-Ons B2B customers may have seasonal needs, for example, an e-commerce platform might need additional capacity only during holiday season. Supporting temporary add-ons means allowing an add-on to be active for a limited number of billing cycles or a fixed time window.

Add-ons are commonly used to move high-value features (needed by only a subset of customers) out of the core plan and into optional purchases. This way you can keep the core plan simple and competitively priced, while still offering the high-value features to customers who need them.

#Add-ons or higher-tier plans

Consider whether the feature should be bundled into a plan or sold separately. If most customers need the feature, it could be part of a higher-tier plan (an upsell). If only some customers need it, offer it as an add-on (a cross-sell) so others aren't forced to pay for it.

Sometimes what starts as an add-on upgrade can eventually suggest a plan change. For example, if a customer continuously increases their usage add-ons, it might be more cost-effective to move them to the next tier plan that includes more usage by default.

#Add-ons or separate subscriptions

Using add-ons keeps all charges under one subscription, which simplifies invoicing. The customer receives a single consolidated bill for their base plan and any add-ons, rather than juggling multiple separate subscriptions. On the other hand, if an add-on has a life cycle of its own (different start/end dates or cancellation independent of the main service), a separate subscription might offer cleaner management.