FAQ: Feb 18 appreciation discount

Learn about the appreciation discount that goes into effect with the February 18 billing changes. 

If you want answers about the billing change in general, please see our billing change FAQ.  

What is the appreciation discount?

The appreciation discount helps customers keep their current number of active profiles while moving to a profile-compliant email plan at Klaviyo.

This discount is automatically available to some legacy Klaviyo customers who, over time, grew their active profile count far beyond the limits of their email plan tier. To help those qualifying customers make the transition to profile compliant plans, the appreciation discount limits any increase to their email plan price to no more than 25%.

It is not a 25% discount; rather, it’s a discount that “caps” a price change to no more than 25%.

For example, a customer on a $100/month plan might have enough profiles to require a $200/month plan. In this case, they would pay the maximum increase of 25%, so their total spend will be $125/month. In other words, they receive a $75 appreciation discount off the $200 plan list price.

The discount is applied automatically; continues indefinitely; and, until further notice, recur as long as an account stays on an applicable plan. The dollar value of the discount will shrink by the amount of any downgrades until it reaches $0. The discount amount does not change if your plan grows.

Is my total email spend going to increase?

At Klaviyo, we firmly believe the value lies in the customer profile, and that’s why we price our email plans based on active profiles with sends included. We recently introduced some new pricing features and fixes that introduce consistency and flexibility for our customers.

For most Klaviyo customers, these changes will have no impact on email plans. However, for some legacy Klaviyo customers, moving to a profile-compliant plan will require a total email spend increase of less than 25%.

For any customers who are so far out of profile compliance that they would require a total email spend change bigger than 25%, Klaviyo is calculating a customer-specific appreciation discount to cap any price change.

How is the appreciation discount calculated?

The appreciation discount is automatic and customer-specific. It is the difference between the list price of a profile compliant plan and 125% of a customer’s email plan price ahead of the announcement on January 14.

For example, a customer on a $100/month plan might have enough active profiles to require a $200/month plan. In this case, they would pay the maximum increase of 25%, bringing them to $125/month. They therefore receive a $75 appreciation discount off the $200 plan list price.

The dollar value of the discount will shrink by the amount of any downgrades until it reaches $0. The discount amount does not change if your plan grows.

So, using the example above, if this customer reduces their active profile count and downgrades to the $175/month email plan, that’s a $25 downgrade. Their appreciation discount would also go down by $25 (to $50). The customer new payment is then: $175 (plan price) - $50 (appreciation discount) = $125/month.

If instead the customer added active profiles and moved from $200 to the $225/month email plan, the appreciation discount stays at $75, for a final price of $150/month.

What do I need to do to get an appreciation discount?

Nothing! Any customers who are eligible will receive the appreciation discount automatically.

When does the appreciation discount expire?

The appreciation discount is applied automatically; continues indefinitely; and, until further notice, it will recur as long as an account stays on an applicable plan. The dollar value of the discount will shrink by the amount of any downgrades until it reaches $0. The discount amount does not change if your plan grows.

How does the appreciation discount work if I also have other discounts?

The appreciation discount is completely independent from any other discounts. They can stack on top of each other, and any changes to an existing discount will not impact the appreciation discount.

What happens to my appreciation discount if I upgrade?

You keep it! The appreciation discount is a dollar discount off your email plan price. As you upgrade, the appreciation discount stays at the same amount, applied every month. Please note if you upgrade before Feb 18th 2025, your appreciation discount will shrink.

What happens to my appreciation discount if I cancel my account and later return to Klaviyo?

The appreciation discount will no longer be available.

What happens to my appreciation discount if I downgrade?

The appreciation discount provides a bridge to profile-compliant email plans at Klaviyo. If your account has an appreciation discount, you clean your active profiles and downgrade, the dollar value of the appreciation discount will also reduce by the size of your downgrade. Otherwise, your bill could become negative! Let’s look at an example:

A customer is on a $200/month plan with a $75 appreciation discount ($125 final price). The dollar value of the discount will shrink by the amount of any downgrades until it reaches $0. If this customer reduces their active profile count and downgrades to the $175/month email plan, that’s a $25 downgrade. Their appreciation discount would also go down by $25, to $50. The customer keeps the same price of $175 (plan) - $50 (appreciation discount) = $125/month.

Note that after you downgrade, the appreciation discount does not grow back if you upgrade.

What happens if I suppress a large number of profiles before February 18?

While we always recommend our customers maintain an efficient list of engaged active profiles, suppressing a large number of active profiles ahead of the February 18 profile compliance changes will not result in a larger appreciation discount.

What happens if I add a large number of active profiles before February 18?

Unless you upgrade your plan, adding active profiles ahead of February 18 only results in your account being farther out of active profile compliance. Thus, it will not lead to a larger appreciation discount.

Will opting in to the new "auto-downgrade on profiles" option impact my appreciation discount?

Not directly. The size of your appreciation discount is not determined by your billing preferences. However, if you enroll in the Auto-downgrade on profiles option and your plan actually gets downgraded, any applicable appreciation discount will be reduced by the dollar value of the downgrade until it reaches $0. This is the same as any other type of downgrade.

Will upgrading my email plan to a higher tier before my first billing cycle after February 18th impact my appreciation discount?

Yes. If you upgrade your email plan before your first billing cycle after February 18th, it will lower your appreciation discount. Please note that on your first billing cycle after February 18th, Klaviyo will automatically migrate you up to the active profile-rightsized plan if you have more active profiles than your current plan entitles you to.

Does the appreciation discount apply to products other than the email and profiles plan?

No. The appreciation discount only applies to the email and profiles plans.

Why did I get a smaller appreciation discount than what was estimated in the emails on January 21 or February 4?

The initial appreciation discount value is set on your first billing date after February 18, based on your current active profile count on that day. While Klaviyo provided estimated appreciation discount via email on January 21 and February 4, those estimates could be different for 4 reasons:

1. You added more active profiles and are further out of compliance.
2. You downgraded your account and are further out of compliance.
3. There was another change to your account, like an existing discount roll-off, that impacted your final email plan price.
4. You upgraded your email plan to a higher tier.