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I think you're really pre-judging your customers in a bad way here. You don't have pathological customers, what you have is a large number of people who instea

by buro9 16y ago

I think you're really pre-judging your customers in a bad way here. You don't have pathological customers, what you have is a large number of people who instead of paying hard currency for a service will trade time as their currency. What this means is that a good number of those who stay on the free side of the freemium model are in fact willing to pay. Just not with cash. What they're willing to do is to spend time to learn your service, to participate in your forums, and in any way that is required to get their free service. When you only expect, want, and cater for the customers who have hard currency you will of course piss off the time-as-a-currency crowd if you've already grabbed them. Then it should come as no surprise when those pissed off people use their time against you. I'm not saying that's a reasonable response. But it's certainly to be expected. The best thing to do is to work out how to use the time-as-a-currency crowd to your advantage. Instead of ditching them in a price-hike, ask them to do something for you. Maybe they have to participate in support forums to help others getting on board in return for the service? Maybe they have to just promote your service on their site? My point is simply that it's naive to ignore this very large set of customers, and even more naive to act in ways that will piss them off if you've already constructed a freemium model that attracted them.

Poiesis 16y ago
You don't have pathological customers, what you have is a large number of people who instead of paying hard currency for a service will trade time as their currency. Look, I'm sure they're very nice people, but their extra time is not going to pay for your ramen. They cost more money and pay less money so they cost you money. You may decide that you would like to optimize for lower revenue, but most people would probably disagree.
- tptacek 16y ago
  It seems to turn out that a lot of them aren't very nice people.
- deleted 16y ago
  [deleted]
damoncali 16y ago
I wish I could accept time-as-currency, but I can't. My bank won't cash the checks.
- tomjen3 16y ago
  Millions sell their time for money everyday. Surely you should be able to sell others time if they give it to you. Suggestions: remove spam from the discussions forums, help the newbies, write tutorials, etc, etc.
  - tptacek 16y ago
    Isn't it a little arrogant to presume that another company should be able to find ways to effectively employ random people who don't want to pay money for their services? There really aren't big stacks of dishes in the back you can wash if you can't pay your tab.
  - damoncali 16y ago
    Good point. I would happily trade a free lifetime account for my bug tracking app ( http://trackjumper.com http://trackjumper.com ) to any graphic/ui designer who will help me improve and/or clean up the main page of the app.
patio11 16y ago
You don't have pathological customers, what you have is a large number of people who instead of paying hard currency for a service will trade time as their currency. This is the exact opposite of my experience. Pathological customers use the service less, spend less time reading the words on the screen, spend less time exploring or reading the documentation and more time asking me questions (in, often, the rudest possible fashions), ask me questions like (I kid you not) "It says that every card will be different. Does that mean every card will be the same? Cuz that would suck.", etc etc.
- jackowayed 16y ago
  You're both right. Patrick, I'm sure you get lots of awful customers. You're targeting not-very-technical people, and when you do lots of SEO/AdWords to get as many people in the door as possible, you'll bring in a lot of good customers and a lot of bad customers. But I don't think Chargify has that many. Of course they had a few, but for the most part, I doubt that those free customers suck; they just aren't making money yet. But a lot of companies that don't know if they'll ever make $49/month when they start writing their payment code turn into valuable customers. You need to look no farther than Bingo Card Creator. Would you have been comfortable locking yourself in to paying $49/month so that you could save time writing payment logic when you first started? I doubt it. But today, a billing system that enticed you with a free plan would be extremely happy that that got you to sign up. The real issue I see for Chargify is that I don't know what their target market is now. They basically have to get new apps, since existing apps will already have something that works. But now they're limiting themselves to new apps with owners that are confident in their success. You're not going to pay $50/month for billing on something that you're just hoping will bring you a few hundred dollars a month, even though some of those apps turn into many thousands a month.
  - lukevdp 16y ago
    " But now they're limiting themselves to new apps with owners that are confident in their success. You're not going to pay $50/month for billing on something that you're just hoping will bring you a few hundred dollars a month" I agree fully. And the first plan is actually $99 month, not $50. $99 as the cheapest option is really pushing it in my opinion. They are offering existing customers are $39 plan, which I think is fair enough for a starting business for the support you need when you're getting setup. I don't understand why they don't just offer this plan to the public as well though.

by buro9 16y ago

Poiesis 16y ago

You don't have pathological customers, what you have is a large number of people who instead of paying hard currency for a service will trade time as their currency. Look, I'm sure they're very nice people, but their extra time is not going to pay for your ramen. They cost more money and pay less money so they cost you money. You may decide that you would like to optimize for lower revenue, but most people would probably disagree.

tptacek 16y ago
It seems to turn out that a lot of them aren't very nice people.
deleted 16y ago
[deleted]

damoncali 16y ago

I wish I could accept time-as-currency, but I can't. My bank won't cash the checks.

tomjen3 16y ago
Millions sell their time for money everyday. Surely you should be able to sell others time if they give it to you. Suggestions: remove spam from the discussions forums, help the newbies, write tutorials, etc, etc.
- tptacek 16y ago
  Isn't it a little arrogant to presume that another company should be able to find ways to effectively employ random people who don't want to pay money for their services? There really aren't big stacks of dishes in the back you can wash if you can't pay your tab.
- damoncali 16y ago
  Good point. I would happily trade a free lifetime account for my bug tracking app ( http://trackjumper.com http://trackjumper.com ) to any graphic/ui designer who will help me improve and/or clean up the main page of the app.

patio11 16y ago

You don't have pathological customers, what you have is a large number of people who instead of paying hard currency for a service will trade time as their currency. This is the exact opposite of my experience. Pathological customers use the service less, spend less time reading the words on the screen, spend less time exploring or reading the documentation and more time asking me questions (in, often, the rudest possible fashions), ask me questions like (I kid you not) "It says that every card will be different. Does that mean every card will be the same? Cuz that would suck.", etc etc.

jackowayed 16y ago
You're both right. Patrick, I'm sure you get lots of awful customers. You're targeting not-very-technical people, and when you do lots of SEO/AdWords to get as many people in the door as possible, you'll bring in a lot of good customers and a lot of bad customers. But I don't think Chargify has that many. Of course they had a few, but for the most part, I doubt that those free customers suck; they just aren't making money yet. But a lot of companies that don't know if they'll ever make $49/month when they start writing their payment code turn into valuable customers. You need to look no farther than Bingo Card Creator. Would you have been comfortable locking yourself in to paying $49/month so that you could save time writing payment logic when you first started? I doubt it. But today, a billing system that enticed you with a free plan would be extremely happy that that got you to sign up. The real issue I see for Chargify is that I don't know what their target market is now. They basically have to get new apps, since existing apps will already have something that works. But now they're limiting themselves to new apps with owners that are confident in their success. You're not going to pay $50/month for billing on something that you're just hoping will bring you a few hundred dollars a month, even though some of those apps turn into many thousands a month.
- lukevdp 16y ago
  " But now they're limiting themselves to new apps with owners that are confident in their success. You're not going to pay $50/month for billing on something that you're just hoping will bring you a few hundred dollars a month" I agree fully. And the first plan is actually $99 month, not $50. $99 as the cheapest option is really pushing it in my opinion. They are offering existing customers are $39 plan, which I think is fair enough for a starting business for the support you need when you're getting setup. I don't understand why they don't just offer this plan to the public as well though.