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The last time this issue came up, I recommended the following free e-book on software pricing, and I still stand by the recommendation: http://www.neildavidson

The last time this issue came up, I recommended the following free e-book on software pricing, and I still stand by the recommendation: http://www.neildavidson.com/dontjustrollthedice.html http://www.neildavidson.com/dontjustrollthedice.html. That should get you thinking about the right issues. Now, as to your specific questions: 1) I'd start charging right away. If you can't get enough users to get good feedback, then that's feedback of a different kind. I don't see any serious upside to getting lots of free users, if you don't already have a business model built around that. 2) My gut is telling me that $7/month sounds low for this kind of product. If you've got compelling advantages over Balsamiq, and a good way to induce trial (i.e., the "free option" you mention), then I'd be thinking in the $15-20/month ballpark. I say this because as a business user, honestly, when evaluating a product that will help my business earn money more efficiently, the difference between $7/month and $20/month is basically a rounding error. They both fall into the "pocket change" bucket.

patio11 16y ago
Plus, the easiest way to communicate with a business user that you are better than Balsamiq is to charge three times what they do. You and I know that Peldi is the thought leader in this space. Your customers, overwhelmingly, do not know who Peldi is. They have two data points: 1) what was on the 5 minutes of Google searching they did (and I'm overestimating by a factor of 10 for many customers) 2) what you are charging. If Balsamiq charges a third of what you do, well, clearly that must be the inferior knockoff which is only used by ramen-chomping MIT students, not what we'd trust our client relationships with. (Balsamiq is, obviously, not an inferior product and I make lots of money for my clients using it. But if you put a gun to my head and said "Compete with it", I'd start by charging a lot more.)
- matt1 16y ago
  Thanks. You have an amazing ability to explain things clearly and concisely...you should write a blog or something (jk!). FWIW I intended to supplant Balsamiq as the mockup tool of choice within the next two years. Wish me luck :)
  - patio11 16y ago
    If N is Balsamiq's current revenue, two years from now you could be making 2N, they could be making 10N, and both of you put together wouldn't have a twentieth of the share of "not doing mockups despite a clear path to benefiting from doing them", to say nothing of the number using inferior solutions such as "sending Excel files around". The true enemy isn't another company. It isn't even the back button, though that is closer (and that pernicious bastard is still costing me 97% of sales). It is the need going unfilled.
    - matt1 16y ago
      How do you make sure you're filling the need?
      - petervandijck 16y ago
        DO whatever you can to understand the need, first. (Sidenote: I checked out the product and it's not addressing my needs.)
    - michael_dorfman 16y ago
      The true enemy isn't another company. It isn't even the back button, though that is closer (and that pernicious bastard is still costing me 97% of sales). It is the need going unfilled. This. I think I'll print that out and hang it on my wall.
matt1 16y ago
Great feedback, thanks. And I'll definitely check out the book. I think it's fair to say that $5 is too low and $30/month is too high, putting me somwhere in the $15-$20 range like you and others recommend.

patio11 16y ago

Plus, the easiest way to communicate with a business user that you are better than Balsamiq is to charge three times what they do. You and I know that Peldi is the thought leader in this space. Your customers, overwhelmingly, do not know who Peldi is. They have two data points: 1) what was on the 5 minutes of Google searching they did (and I'm overestimating by a factor of 10 for many customers) 2) what you are charging. If Balsamiq charges a third of what you do, well, clearly that must be the inferior knockoff which is only used by ramen-chomping MIT students, not what we'd trust our client relationships with. (Balsamiq is, obviously, not an inferior product and I make lots of money for my clients using it. But if you put a gun to my head and said "Compete with it", I'd start by charging a lot more.)

matt1 16y ago
Thanks. You have an amazing ability to explain things clearly and concisely...you should write a blog or something (jk!). FWIW I intended to supplant Balsamiq as the mockup tool of choice within the next two years. Wish me luck :)
- patio11 16y ago
  If N is Balsamiq's current revenue, two years from now you could be making 2N, they could be making 10N, and both of you put together wouldn't have a twentieth of the share of "not doing mockups despite a clear path to benefiting from doing them", to say nothing of the number using inferior solutions such as "sending Excel files around". The true enemy isn't another company. It isn't even the back button, though that is closer (and that pernicious bastard is still costing me 97% of sales). It is the need going unfilled.
  - matt1 16y ago
    How do you make sure you're filling the need?
    - petervandijck 16y ago
      DO whatever you can to understand the need, first. (Sidenote: I checked out the product and it's not addressing my needs.)
  - michael_dorfman 16y ago
    The true enemy isn't another company. It isn't even the back button, though that is closer (and that pernicious bastard is still costing me 97% of sales). It is the need going unfilled. This. I think I'll print that out and hang it on my wall.

matt1 16y ago

Great feedback, thanks. And I'll definitely check out the book. I think it's fair to say that $5 is too low and $30/month is too high, putting me somwhere in the $15-$20 range like you and others recommend.