Introduction – Why Pricing Model Choice Matters
Salesforce Commerce Cloud doesn’t have a one-size-fits-all price tag. Instead, enterprises often face a choice between a Gross Merchandise Value (GMV) based model and an order-based pricing model.
This decision can result in millions of dollars in annual savings.
For e-commerce directors and CFOs, choosing the right Commerce Cloud pricing model (and negotiating its terms) is critical.
Salesforce will frame its pricing as flexible and success-based, but you should approach it with healthy skepticism and a buyer-first mindset. For a complete overview, read our Salesforce Commerce Cloud Pricing & Negotiation Guide.
The model you choose affects not only your budget but also how costs scale as your online business grows.
In short: picking the right pricing model – and negotiating smartly – can mean the difference between a manageable platform cost and an unwelcome budget shock.
GMV (Gross Merchandise Value) Model
The GMV model charges a percentage of your online sales revenue processed through Salesforce Commerce Cloud. In other words, you pay Salesforce a cut of your sales.
This is essentially a Commerce Cloud percentage-of-sales approach.
A quick example: if you do $50 million in annual online sales and your GMV fee is 2%, you’d owe Salesforce $1 million per year. The rate can vary (often around 1–3% of revenue, depending on your deal size, edition, and negotiations).
Advantages:
The GMV model is straightforward when your sales are steady or predictably growing. It’s easy to forecast costs as a fixed share of revenue. Salesforce often pitches this as “we only do well when you do well” – meaning if sales dip, your fee dips too.
For businesses with seasonal or cyclical sales, paying a percentage of sales can align costs with revenue flow. Also, if you have very high order volume but low average order value (AOV), a GMV model might yield a lower percentage fee than paying a fixed amount on every tiny order.
Risks: High-cost exposure if your sales soar. Under a GMV model, success comes at a price – literally. If you double your GMV, your fees double. This can feel like a tax on growth.
Companies with aggressive growth plans or high AOV products must be cautious: a few huge sales or continually rising order values mean Salesforce’s cut grows big.
For instance, if your average order value jumps from $100 to $500, that 2% fee on each order quintuples.
Over a multi-year contract, a GMV model can lead to unpredictable or runaway costs if your projections are too low. In short, you’re sharing upside with Salesforce – great in bad times, but costly in good times.
Order-Based Pricing Model
The order-based model charges a fixed fee for each order processed on the platform, regardless of the order’s dollar value. Instead of paying a percentage of revenue, you pay per transaction.
For example, if you process 100,000 orders a year at a negotiated rate of $5 per order, your Commerce Cloud cost would be $500,000 per year.
In this Salesforce order-based pricing approach, an order worth $10 and an order worth $10,000 carry the same platform fee.
Advantages: The order-based model protects you from high AOV scenarios. If you sell big-ticket items or have a luxury catalog with few orders but high revenue per order, you don’t get penalized for those large transactions.
Your costs scale with the volume of orders, not the value, which can be beneficial for high AOV, low-volume businesses. This model also introduces a level of cost predictability per order – useful for unit economics calculations (you can say “Commerce Cloud costs us $X per order” and bake that into margins).
If your average order value is very high, the per-order fee as a percentage of sales will be minimal (e.g. $5 on a $1000 order is 0.5%, much better than paying 2% = $20).
Another plus is that if your revenue grows mostly by increasing order values (not counting), your costs stay flat since it’s about the number of orders.
Risks: Expensive for high-volume, low-value orders. If you run a business with tons of small orders (think low-cost goods with many transactions), those per-order fees pile up fast. For example, 1,000,000 orders at $5 each would be $5 million in fees – much higher than a GMV percentage on the same $50M revenue.
Companies with thin margins or low AOV can find that an order-based model eats a big chunk of each sale (e.g. $5 on a $20 order is 25% of that order’s revenue!). Additionally, forecasting costs can be tricky if order volumes swing seasonally. A massive holiday peak with double the orders means double the fees, even if revenue doesn’t double.
So this model is sensitive to transaction counts – you’ll need to budget for peaks in order volume.
It’s also worth noting that Salesforce might set tiered per-order pricing or minimums, so high growth in orders could push you into higher cost brackets if not negotiated carefully.
Side-by-Side Cost Comparison
To summarize the differences, here’s a side-by-side comparison of the GMV vs. order-based models:
| Criteria | GMV Model | Order-Based Model |
|---|---|---|
| Cost Basis | Pays a % of sales (revenue) | Pays a flat fee per order |
| Best Fit | High order volume, low AOV | Low order volume, high AOV |
| Risks | Cost spikes if GMV grows unexpectedly (expensive in boom times) | Cost spikes if order counts soar (expensive with huge volume) |
| Forecasting | Sensitive to sales growth projections (revenue-based budgeting) | Sensitive to seasonal peaks in order count (volume-based budgeting) |
Example scenario: Imagine two businesses, each doing $50M annually online. Company A has 1,000,000 orders/year (low AOV of $50). Company B has 100,000 orders/year (high AOV of $500).
Under a 2% GMV deal, both pay $1M (since revenue is $50M). Under a $5 per order deal, Company A would pay $5M (ouch!), while Company B pays $500k.
Company A clearly benefits from the GMV model (just $1M vs $5M), whereas Company B benefits from order-based (just $500k vs $1M). This illustrates the importance of aligning the model with your business’s profile.
Plan for the future, Exit Strategy: What to Negotiate if You Might Leave Commerce Cloud in the Future.
Choosing the Right Model for Your Business
There is no universal “best” model – it depends on your sales patterns and projections. Here are some general guidelines:
- If you have high AOV and relatively fewer transactions, an order-based model is usually safer. Why give Salesforce a big slice of your large orders when you could pay a flat fee? Businesses selling luxury goods, B2B wholesalers, or expensive equipment often prefer per-order pricing to protect against percentage fees on big sales.
- If you have high transaction volume and lower AOV, the GMV model may be cheaper. When you’re processing huge order counts (millions of orders for small items), a percentage of total sales can yield a lower effective rate than paying a fixed amount on each order. Many retail and consumer goods companies with lots of small orders favor a percent-of-sales model to avoid per-order fees eating their margins.
- If your volumes or AOV are unpredictable, consider negotiating a hybrid or protective clauses. Uncertainty (like viral sales spikes or market expansions) can burn you on either model. We’ve seen deals with hybrid pricing (e.g., a reduced % of sales plus a small per-order fee) or contracts with caps (not paying beyond a certain amount) to handle volatility.
Checklist – Model Fit Questions:
Before deciding, ask yourself these questions about your business:
- What’s your average order value (AOV)? (High AOV means the GMV model could get costly; low AOV means per-order could get costly.)
- How many orders do you process annually, and are order counts growing? (Rapid growth in order count might favor GMV; rapid growth in AOV might favor per-order.)
- What’s your expected GMV growth rate in the next few years? (If you expect huge sales growth, locking a high % of GMV fee could hurt – unless you negotiate tiered rates or caps.)
- How seasonal or peak-heavy is your order flow? (Big seasonal spikes could lead to big one-time fees in an order model; a GMV model will also spike with revenue, but perhaps align with high-income periods. Either way, consider if one model handles peaks better in your budgeting.)
- How healthy are your profit margins? (A GMV fee directly cuts into margin as a percent of sales; if you run on thin margins, a high percentage fee might be unsustainable. Per-order fees are a more fixed cost per sale, which you can aim to offset with pricing or efficiency.)
By evaluating these factors, you can identify which model (or mix) aligns best with your business’s economics. The key is to run the numbers for both models using your own data – don’t just take Salesforce’s recommendation at face value.
Negotiation Strategies
Choosing a model is only half the battle – you also need to negotiate a favorable deal. Salesforce Commerce Cloud pricing negotiations are notorious for flexibility if you know what to ask for.
Use these strategies to get the best terms:
- Push for Flexibility: If you’re uncertain about what the future holds, ask for hybrid pricing or the ability to adjust. For example, negotiate a lower GMV percentage coupled with a cap on per-order fees (or vice versa). In some cases, you might negotiate the option to switch models or adjust rates after a year if projections were way off (Salesforce may resist, but it never hurts to ask for a mid-term recalibration clause).
- Cap Growth Exposure: One of the biggest fears is a runaway bill if your business dramatically exceeds forecasts (a good problem, except for the fees!). Negotiate contractual caps on fees. This could mean a maximum dollar cap on annual GMV fees (e.g., “not to exceed $X million per year regardless of sales”) or a cap on per-order fees after a certain volume (e.g., “orders beyond 500k in a year are charged at half-rate” or an outright fee cap). Caps protect you from wild cost spikes.
- Benchmark Aggressively: Salesforce’s pricing is negotiable, especially for large deals. Research what similar companies are paying (if you can) or work with consultants who know industry benchmarks. If peers have a 1.5% GMV rate or $2 per order rate, bring that knowledge to the table. This leverage can push Salesforce to improve its offer. Remember, the first quote you get is rarely the best — they often have wiggle room, especially at the end of the quarter or if you’re considering a competitor.
- Commit for Concessions: Salesforce will often trade a better rate for a bigger commitment. A longer contract term (e.g., committing to 3-5 years instead of annual) can motivate them to lower the percentage or per-order fee. Likewise, if you’re also buying other Salesforce products (Marketing Cloud, Service Cloud, etc.), bundle the deals and ask for an overall discount. Be strategic: only extend contract length if you’re reasonably sure the platform and model will remain a good fit. And ensure you have escape clauses for fundamental changes (for example, if your company is acquired or pivots, you don’t want to be stuck in a bad deal).
When negotiating, always consider the total cost of ownership. Ask about things like: Are refunds/returns excluded from GMV calculations? (They should be – you don’t want to pay for sales you didn’t keep.) Will services like infrastructure, support, or any add-on features incur extra costs beyond the base model fee? Clarify everything and get it in writing.
FAQs
Q: Can we switch pricing models mid-term if we regret the choice?
A: It’s challenging. Salesforce contracts typically lock you into a model for the term of the agreement. However, if your business changes drastically (e.g., your volume or AOV diverges hugely from forecasts), you can always approach Salesforce to renegotiate. Success varies – you may need to wait until the next renewal. The best approach is to negotiate flexibility upfront (like a one-time model switch option or a short initial term). Absent that, you’re likely committed until renewal, so choose carefully.
Q: Does Salesforce ever discount the percentage of GMV?
A: Yes, absolutely. That percentage is highly negotiable for large or strategic customers. While list rates might be 2% or 3%, big clients often negotiate lower (1% or even below, depending on volume). Salesforce representatives have quotas and will negotiate, especially if you express cost concerns or present competitive alternatives. Push for a lower rate or tiered percentages that drop as your sales grow. Also, clarify what counts as GMV – ideally, exclude taxes, shipping costs, and refunded orders so you’re only paying for true product revenue.
Q: Are returns and refunds included in GMV calculations?
A: By default, Salesforce may count the gross transaction value at the time of sale, which could include later-refunded revenue unless the contract specifies otherwise. You should negotiate the definition of GMV in your contract. Best practice is to define GMV as net revenue: exclude refunds, returns, fraud, and even sales tax or shipping if you can. You don’t want to pay a percentage on a $100 order that got returned and refunded. Make sure the fee reflects the revenue you actually get to keep.
Q: Can hybrid pricing be negotiated?
A: It’s not standard, but yes, for the right deal, Salesforce might consider it. Hybrid pricing could mean a combination (e.g., a smaller % of GMV plus a small per-order fee, or a base subscription plus usage overages). Large enterprises with unpredictable profiles have crafted bespoke models when the out-of-the-box choices didn’t fit. It helps if you can model why neither pure GMV nor pure per-order works for you and present a hybrid that caps the extreme cases. Salesforce won’t offer this upfront, but if they want your business, they may get creative.
Q: What if our order volume grows faster than forecasted – will we be penalized?
A: If you chose an order-based model and orders explode beyond projections, you’ll end up paying a lot more (since every order costs). If you choose GMV and GMV spikes, similarly, you pay more. Essentially, any growth beyond your expectations means higher fees unless you have protective terms in place. That’s why negotiation is key: insert volume or cost protections. If you didn’t, you’re not exactly “penalized” (since you’re just paying the agreed formula), but it can feel painful. In mid-contract, your leverage to change that is limited. Still, you might consider approaching Salesforce to discuss an adjustment or adding a cap (especially if the alternative is seeking another platform at renewal). Always plan for success: negotiate what happens if you vastly exceed your projections – it’s a good problem that can turn into a bad one if not accounted for.
Five Expert Recommendations
Finally, here are five expert tips to ensure you get the best outcome on Commerce Cloud pricing:
- Run the Numbers on Both Models: Don’t rely on Salesforce’s recommendation – do a thorough cost modeling of both GMV and order-based pricing using your own sales data. Take your last 2-3 years of orders and revenue and calculate what you would have paid under each model. This hindsight analysis will highlight which model aligns better with your business pattern (and possibly how big the cost difference can be). It also provides a baseline for negotiation – if one model is clearly much cheaper for you, you’ll know which to push for.
- Negotiate Caps to Prevent Runaway Costs: Always include caps or at least rate review clauses. For a GMV deal, try to negotiate something like “fees capped at $X if sales blow past a certain point” or a sliding scale that lowers the percentage beyond a revenue threshold (so you get volume discounts as you grow). For an order-based deal, similarly consider a cap on the total fees or a lower per-order fee after Y orders. This way, a blockbuster holiday season or an unexpected surge won’t result in a budget-busting invoice.
- Get Quotes for Both Models: When evaluating Salesforce Commerce Cloud, ask your rep to provide parallel quotes – one for a GMV-based pricing and one for an order-based pricing (for the same expected usage). Salesforce may have a default preference, but seeing both options side by side is invaluable. It not only lets you compare costs, but also gives you leverage: you can mix and match elements or push for whichever quote is more favorable. If they know you’re crunching the options, they’re more likely to sharpen their pencil on the rates.
- Consider a Hybrid or “Grow-into-it” Structure: If your growth is unpredictable or you’re in startup mode, don’t accept a rigid model. You might negotiate an initial period on one model and a switch later, or a hybrid that charges a baseline plus variable component. Another approach is a ramp-up structure: e.g., first year at a low base fee to get you onboard, then moving to GMV or order fees as your volume stabilizes. The goal is to avoid paying huge fees while you’re still scaling up or to avoid getting trapped in an untenable model if business dynamics change.
- Benchmark and Seek External Advice: Always benchmark any offer against industry data. Talk to other Commerce Cloud customers (if possible) or engage a third-party advisor who knows Salesforce Commerce Cloud pricing negotiation. These experts often know the discount bands and typical concessions. Going in with facts (like “Company X of similar size got a 1.5% GMV rate and a cap on fees”) changes the power dynamic. Salesforce reps are salespeople – they respond when they sense you’re an informed buyer. Don’t be afraid to pit alternatives against each other as well (e.g., mention you’re considering Shopify Plus, Magento, or others that have different pricing structures) to make Salesforce work harder to win or keep your business.
In conclusion, picking between the Commerce Cloud GMV model and an order-based model comes down to understanding your business’s numbers and negotiating fiercely to align with your interests.
Salesforce’s pricing can be complex and even skewed in their favor if you’re not careful – but with diligent analysis and strong negotiation, you can structure a deal that supports your growth without breaking the bank.
Happy negotiating, and may your e-commerce growth translate into profits, not just higher software fees!
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