Challenge

Known for its personalized customer service platform, Intercom has long invested in intelligent bots. In 2023, the company introduced Fin, a powerful AI agent that can both answer customer questions and take relevant actions.

Fin’s advanced capabilities required a new pricing approach. Traditional seat-based pricing models were fundamentally misaligned with the value Fin was providing. Fin’s potential performance could mean that a company with 1,000 customer service employees might eventually only need 200 people in customer service. So, a seat based pricing model would mean prices decreasing as value was increasing. And usage-based billing—charging per conversation—didn’t reflect actual value delivered, nor did it resonate with users.

“In early 2023 when we first launched Fin, users were really hesitant at the thought of paying for something that might not work,” said Aisling O’Reilly, head of pricing at Intercom. “At that time, trust in agents’ ability to effectively answer these questions was low.”

Intercom needed a model that would closely align pricing with value and a payment partner that could accommodate an innovative approach. In addition, the Fin team expected to iterate on its pricing approach over time, so it required a partner with the flexibility to adapt as needed on a short time frame.

Solution

As Intercom prepared to launch Fin, it was also in the middle of a massive migration from its in-house billing engine to Stripe Billing, which offered the functionality that Intercom needed to support new products and pricing models. “It was very obvious to us that our ways of working, especially in terms of collaboration and partnership, matched quite significantly with Stripe’s,” said Dave Lynch, Intercom’s VP of engineering. “The way that Stripe is built from an engineering perspective, with everything as an API, is a great fit for our team.”

The timing was fortuitous for the Fin team: they ultimately decided to adopt outcome-based pricing, which aligns with the value users receive from Fin. In this model, users pay 99¢ per resolution, meaning they are only charged when a customer confirms the AI answer resolved their issue, or when they don’t ask for more help after the last AI answer. Intercom used the usage-based billing features in Billing to power Fin’s pricing strategy—defining, metering, and billing customers for resolved issues only. To generate a customer’s outcome-based bill, Intercom’s team simply needed to configure a meter in Billing, then send usage events to Stripe via API to aggregate each customer’s successful resolutions.

The platform’s flexibility gave the company a full menu of tools to adjust pricing as it learned from user behavior. “We realized, hey, it might be nice if we don’t have to build all of this ourselves, and we can lean on the Stripe Billing platform for some of it,” said Lynch.

The platform’s flexibility gave the company a full menu of tools to adjust pricing as it learned from user behavior. “We realized, hey, it might be nice if we don’t have to build all of this ourselves, and we can lean on the Stripe Billing platform for some of it,” said Lynch.

For example, as Fin adoption grew, some users struggled with the uncertainty of how much they would pay for it, given factors such as seasonal changes in conversation volume and the product’s sheer novelty. Intercom rolled out multiple changes to address those concerns, including allowing customers to reallocate spending from seats in Intercom’s core customer service platform to Fin resolutions, made possible by the flexibility of Billing. Intercom also introduced annual buckets, which allow users to purchase a set number of resolutions for a year and draw them down at any point over that period.

Intercom partnered with Stripe’s professional services team for strategic expertise to guide these changes, and to plan for future enhancements as it continues to expand its capabilities with Stripe.

Results

Intercom added an eight-figure business line with Fin’s outcome-based pricing model

The launch of Fin created tens of millions of dollars in revenue in less than a year thanks to the strength of Fin’s technology, as well as Intercom’s ability to offer value-based pricing powered by Stripe.

“AI agents for customer support were new when we launched, so we optimized our pricing for flexibility,” said O’Reilly. “We prioritized simplicity and alignment with user value.”

The pricing model now drives user adoption, with more than one million resolutions a week

Intercom users have responded enthusiastically to Fin, which is now resolving more than one million customer service conversations a week thanks to strong adoption across a broad range of industries and customer service teams.

“Outcome-based pricing has been hugely helpful in terms of building user trust,” said O’Reilly. “In addition, the entire company is now focused on driving resolution rates, because for us to win, our users have to win.”

Fin launched adjusted pricing in just three months

With Stripe’s flexible usage-based billing tools, Intercom was able to launch the first iteration of its outcome-based model quickly and begin collecting user feedback for rapid modifications. “With annual buckets, we cared a lot about speed to market, because we were leaving revenue on the table,” said Lynch. “With the foundation that Stripe provided, our engineering team was able to customize around the edges and get to market in just three months.”