There's been a lot of buzz recently in the tech community around how AI agents should be priced (check out Aaron Levie's thoughtful post).
Today, we're sharing some of our learnings around the economics of deploying AI agents to many customers.
At the core, the value provided by AI agents is fundamentally different from the traditional per-seat software products we know and love.
AI agents are able to complete entire jobs autonomously, so there's a direct parallel with human labor. Similarly, there's often an easy way to quantify and measure the impact.
In our space at Decagon, the metrics everyone evaluates are:
1. Deflection rate: What % of customer conversations are resolved by the AI agent with needed a human?
2. Customer satisfaction: How happy are customers with these conversations?
This naturally leads to a pricing model that scales with conversation volume, because that's how much work is done.
We offer 2 ways to achieve this:
1. Per-resolution: Pay $X for each conversation that's resolved by the AI
2. Per-conversation: Pay $X for each conversation that flows through the AI
Over time, we've seen the vast majority of customers opt for the per-conversation model.
Why is that?
Per-resolution has the benefit of scaling with the 'results' achieved by the AI. At the same time, it naturally leads to a debate: what exactly is a 'resolution'? You never want to be in a situation where a user is upset and leaves, but they're just being deflected because that's how the incentives work.
We've seen that companies prefer the predictability and collaborative-ness of the per-conversation model, but both options have merit.
I'm excited to see how the pricing models play out in other AI agents well! For example, I've heard of some creative models on the coding side.
Full post linked below by Bihan Jiang! 👇