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Happy to answer questions to the extent that I can. Speaking of which: if it isn't transparently obvious by now, I really, really like getting feedback about h

• bdunn 14y ago
  Patrick, I've recently doubled my pricing across the board. To confirm Ruben's results, no change in trial/paid conversions. Next step is disconnecting from "usage" (right now, plans are based on # of employees using the software, all plans have the same features) and moving towards plans based on the goals of the business: Do they need reporting? Are they comfortable being a solo freelancer working from Starbucks, or is the customer (or wants to look like) a big agency that needs a lot more flexibility?
  • dchuk 14y ago
    This is the exact path I'm taking with my company very soon (I refer to it as persona based pricing, not sure if that's the correct technical term or not). We've found that increased usage is not what differentiates our users (no one hits the imposed limits on their plans). So we're switching to plans that users should be able to read and immediately identify themselves with (Solo, Consultant, Agency) Would love to chat with you about your thoughts and results if you're interested.
    • bdunn 14y ago
      Absolutely. brennan at planscope.io
    • glimcat 14y ago
      I refer to it as persona-based pricing I hereby declare this to be the correct technical term for it. The guys in marketing may be calling it something else, but I don't think you'll find a more succinct description of the strategy.
      • jbigelow76 14y ago
        The guys in marketing may be calling it something else... I have a suspicion the marketing guys might come up with that terminology as well (sorry I couldn't resist a little off topic inside baseball)
• mootothemax 14y ago
  What are your thoughts on trimming down the price options even further, e.g. one plan around $200/month, plus a "need more? we do custom plans, call us!" option? Oh, and thanks for writing this, there's some really useful information here.
  • patio11 14y ago
    The notion of keeping customers from having to make multiple decisions at once appeals to me, but you hugely gain by ability to price discriminate against customers who are less sensitive. There's a reason almost everyone you can think of has more than one price for their offering. Can I give you a suggestion that's halfway there? There's no reason that your /pricing page has to be the only channel anywhere for getting signups. You might have a particular recommendation specific to a particular audience and give that particular audience just a single option. For example, when I write drip marketing campaigns, I often pitch the #3 out of 4 plan semi-exclusively, and send folks to pages which plug it and only it. (If you want to hear more about drip marketing get on my email list. August will be a fun month for you. If you don't want to hear about email marketing optimization my email list is a very bad place to be for the next couple of weeks.)
    • mootothemax 14y ago
      Thanks, that's really good advice. I'm planning on launching a new product at some point next month, and am preparing the initial pricing plans now. I hadn't thought of offering custom pages for specific audiences like that - I'm already on your list, and looking forward to seeing what turns up :)
• mamcx 14y ago
  Any info in the best price strategy for online backup software, for companies? Price per server, GB or what?
  • patio11 14y ago
    I haven't worked directly with any online backup software companies (and wouldn't give you their secrets if I had). In general, I'd try to align pricing with customer success, such that e.g. a big enterprise doing online backup of a mission critical application would end up paying a heck of a lot more per anything than a bride backing up her wedding photos. This would tend to suggest not pricing backups by weight at all because, crucially, businesses do not value data by weight. 8 GB of bingo cards: doesn't matter if they get rm -rf'ed, I can regenerate them trivially. 200kb gzipped of Appointment Reminder database backups: that literally represents more than half my net worth. The production database for a large enterprise customer? That might trivially be worth $20k+ per month, totally no-brainer, regardless of size. My most specific recommendation: if the pricing page includes "picodollars", it really shouldn't. (Much love for Tarsnap but darn it I'm right.)
    • cperciva 14y ago
      if the pricing page includes "picodollars", it really shouldn't I knew that was coming as soon as I read the question. :-)
      • statictype 14y ago
        Have you considered running tests on your marketing copy and doing the math on the hard data you get out of it? I think I understand your point that you're not interested in having the type of customer who would be scared away by 'picodollars' (as opposed to finding it amusing) but you should at least test it out and get the numbers to verify your hypothesis right? (As a bonus, if you're right, you get to shove it in the faces of everyone else. If you're wrong - well congratulations - you just increased sales) Unless you're doing this more as a principled stand (which is fine I guess).
    • 14y ago
• gav 14y ago
  If you are targeting non-technical people, I wonder what improvement the change from "∞ users" to "unlimited users" would be.
  • patio11 14y ago
    Non-technical is not a synonym for uneducated. Many of my non-technical customers have masters degrees, and substantially all passed high school math. The typical non-technical decisionmaker trying to buy server-monitoring software has a title like Purchasing Director or Team Lead and a four-year degree or better. (I'd also tend to avoid that A/B test because the pricing grid looks very clear in context.) There's a semi-related issue where talking in a particular way can make you seem like The Other to someone, and you don't want to do that, but I doubt the person with purchasing authority is so scared of math that this qualifies. (I might avoid putting a D&D joke on that page, where I would totally do that when talking directly to a geeky audience, if that fits the company culture.)
    • gav 14y ago
      That wasn't a dig at non-technical people, more so that I've always (and seen results) from being a clear as possible. It took me a couple of seconds between reading "infinity" and realizing what you meant.
• rodolphoarruda 14y ago
  Patrick et al. I work in the e-commerce "ecosystem". What's your opinion about offering all software functionality for free, but charge for support and other side services like "product catalog management", "product image treatment", "e-mail marketing campaigns management" etc? Do you think customers may like the idea?
  • patio11 14y ago
    I think that the kind of customers who think "Oh, you know what, I want to run my business on a platform put out by a company with no clear way of keeping the lights on" are absolutely not the customers which you want to get. They're disproportionately going to be people who aspire to make money on the Internet rather than people who actually run businesses. People who actually run businesses are much better prospects: they have money and are willing to spend as much of it as you'd care to take if you can generate positive ROI. They'll be much more positively inclined to upsells like e.g. improved photography for their goods because they know that will directly make them money, whereas someone who a) has no orders and b) has no goods won't understand why on earth they'd pay for a professional photographer. These very desirable business customers will run screaming from the impending trainwreck of a company which is proposing a) tie your business at the hip to ours and b) we could fold at any stiff breeze.
• 147 14y ago
  What about pricing a B2C SaaS? It seems to me that all of the advice I've found leans towards pricing B2C and charging a lot more money. Will applying the same techniques work for B2C where customers will be more stingy with their money?
  • Silhouette 14y ago
    Will applying the same techniques work for B2C where customers will be more stingy with their money? Which techniques? Market segmentation and pricing by features? Sure, absolutely. Some people value a certain service more than other people depending on their circumstances, just as some businesses do. Doubling/trebling your prices overnight and hoping you'll get a similar number of customers all paying several times as much? ROFLOLWAT. These customers are spending their own money, and not only will many of them take their business elsewhere if you try to charge insulting prices, they'll tell all their friends that your service is a rip-off, too. Obviously it's not really as simple as that. For example, a lot of businesses pitch their prices far lower than market value would support at first. In those cases, increasing the prices to something higher but still reasonable is fine and often quite lucrative. But you're absolutely right that advice that holds for B2B environments doesn't necessarily work the same way in a B2C context. The starting point and assumptions simply aren't the same.
• bravura 14y ago
  Here's what I find really surprising: Making the word "Free" in the call-to-action much less prominent did not reduce conversion by very much. The original page prominently says: "Sign up for a free trial" and gets a 6.9% conversion from visitor to trial user. The new page unprominently says: "Money back guarantee" and "Free Sign Up" in the top right corner. Conversion is 5.2%, which is almost the same considering the scope of the change, even though there was much less use of the word "Free". This is surprising in itself. I'm also curious about how the next stage of the funnel is converting users from the trial to entering their credit cards. Also you say that credit card signup is not mandatory. When does the CC enter the picture? Does the service wait a while (e.g. one month ) and ask you to enter you credit card? How does this compare to taking a credit-card upfront and offering a one-month money-back guarantee?
  • hythloday 14y ago
    I don't want to be pedantic, but 25% fewer conversions is not "almost the same", it's quite the loss. You need to increase your funnel 33% somewhere down the line to make up for it (which I'm sure they did - I'm just making the point that X% -> X-d% is significant if X and d are small).
    • dmytton 14y ago
      Depends if you're maximising for revenue or signups. The number of signups decreased but the revenue increased significantly, making up for the loss in signups. Of course if you can increase signups now with the new pricing then that would also show revenue increase.
  • robryan 14y ago
    I think this might be because of the product. Most people probably don't want free server monitoring, as the perceived reliability and performance would be worse.
  • dmytton 14y ago
    We request a credit card when the trial expires.