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People don't want to subscribe to stuff. They only do it when there is no other choice. If your site only offers subscriptions, I'll make a site with a one-time

People don't want to subscribe to stuff. They only do it when there is no other choice. If your site only offers subscriptions, I'll make a site with a one-time payment thing, store the users payment information and sell them new 'innovations' and 'features' that will be as easy as clicking a button to get, and that will bring me more money that your subscriptions. If I have someone using my site all the time, it's easy to sell him something new.

terrellm 17y ago
I agree that people prefer a sense of ownership rather than renting, even if renting is in their best interest. However, the problem with a one-time payment is that the vendor loses incentive to continue supporting the buyer after the transaction. The primary way to generate additional revenues from that customer is, as you say "sell new innovations and features". This adding of new features can increase complexity which eventually impacts the ease of use and increases the learning curve. These two side effects can have a negative impact on new user signups. I'm optimistic of the web app user model after having developed desktop software for the past 10 years. Each version has to "work just like the previous, but better". You can only do that for so many versions :)
- gte910h 17y ago
  I honestly prefer fee-per-month software. It is MUCH cheaper than the equivalent valued software would be for the first 4-5 months, and most software is used infrequently, so I usually save money with the starting and stopping of subscriptions.
  - jhancock 17y ago
    I like SaaS subscriptions as well. Most that hold my data as opposed to just providing a cool tool do not allow you to turn off your subscription for a few months without losing your data.
Slashed 17y ago
What about 'pay for what you use' model? Isn't this somewhere in between of subscription and one-time payment? Users still get the sense of 'ownership' and based on a product, businesses can get payments almost as if it was a subscription service. Though I absolutely understand that this model can't fit all, but I find it to be a good option to consider.
DenisM 17y ago
People don't want to subscribe to stuff Should we assume that you talked to 6 billion people, or would you like to qualify your blanket statement?
- maxklein 17y ago
  Actually - I have some data. I had a product priced at $2 per month subscription vs $50 one-time fee. More people paid the one-time fee than the subscription. From talks I've had with people, people prefer to pay a one-time fee than a subscription.
  - terrellm 17y ago
    I think the answer is "it depends". $50 isn't a a lot of money to many people so your product could still considered an impulse buy. If you look at a product that runs $25/mo, a user would look at $625 one-time fee. I'd imagine the one-time purchases would be much lower.
    - maxklein 17y ago
      But your statement is also making a generalisation. You say $50 is not much money to a lot of people. How do you prove that statement? The one-time fee strategy is a way of pulling people in cheaply and then upselling them. You will not a $25 a month product $650 one time, you make it $99 one time payment, and you optimise your funnel to upsell them within the first 4 months. A $25 a month product will have a LOT of cancellations compared to a $5 a month product.
  - DenisM 17y ago
    And among the people I talk to most prefer to live in Seattle. Is it representative of the people at large? Your generalization is completely unwarranted, at best you could derive that "among buyers of X most prefer one-time payment".
    - maxklein 17y ago
      I think my generalisation is quite warranted. My sample size ran to about 30 people, who were not selected by me in any way. If you are selling a product that is a one-time fee and you are happy with the model, then fine, let's agree to disagree. If you are building something and want to make subscriptions or have some interest in my statement being wrong, then you are approaching business with the wrong attitude. In the absence of any information to the contrary, I like to work with the little info I have.

terrellm 17y ago

I agree that people prefer a sense of ownership rather than renting, even if renting is in their best interest. However, the problem with a one-time payment is that the vendor loses incentive to continue supporting the buyer after the transaction. The primary way to generate additional revenues from that customer is, as you say "sell new innovations and features". This adding of new features can increase complexity which eventually impacts the ease of use and increases the learning curve. These two side effects can have a negative impact on new user signups. I'm optimistic of the web app user model after having developed desktop software for the past 10 years. Each version has to "work just like the previous, but better". You can only do that for so many versions :)

gte910h 17y ago
I honestly prefer fee-per-month software. It is MUCH cheaper than the equivalent valued software would be for the first 4-5 months, and most software is used infrequently, so I usually save money with the starting and stopping of subscriptions.
- jhancock 17y ago
  I like SaaS subscriptions as well. Most that hold my data as opposed to just providing a cool tool do not allow you to turn off your subscription for a few months without losing your data.

Slashed 17y ago

What about 'pay for what you use' model? Isn't this somewhere in between of subscription and one-time payment? Users still get the sense of 'ownership' and based on a product, businesses can get payments almost as if it was a subscription service. Though I absolutely understand that this model can't fit all, but I find it to be a good option to consider.

DenisM 17y ago

People don't want to subscribe to stuff Should we assume that you talked to 6 billion people, or would you like to qualify your blanket statement?

maxklein 17y ago
Actually - I have some data. I had a product priced at $2 per month subscription vs $50 one-time fee. More people paid the one-time fee than the subscription. From talks I've had with people, people prefer to pay a one-time fee than a subscription.
- terrellm 17y ago
  I think the answer is "it depends". $50 isn't a a lot of money to many people so your product could still considered an impulse buy. If you look at a product that runs $25/mo, a user would look at $625 one-time fee. I'd imagine the one-time purchases would be much lower.
  - maxklein 17y ago
    But your statement is also making a generalisation. You say $50 is not much money to a lot of people. How do you prove that statement? The one-time fee strategy is a way of pulling people in cheaply and then upselling them. You will not a $25 a month product $650 one time, you make it $99 one time payment, and you optimise your funnel to upsell them within the first 4 months. A $25 a month product will have a LOT of cancellations compared to a $5 a month product.
- DenisM 17y ago
  And among the people I talk to most prefer to live in Seattle. Is it representative of the people at large? Your generalization is completely unwarranted, at best you could derive that "among buyers of X most prefer one-time payment".
  - maxklein 17y ago
    I think my generalisation is quite warranted. My sample size ran to about 30 people, who were not selected by me in any way. If you are selling a product that is a one-time fee and you are happy with the model, then fine, let's agree to disagree. If you are building something and want to make subscriptions or have some interest in my statement being wrong, then you are approaching business with the wrong attitude. In the absence of any information to the contrary, I like to work with the little info I have.