How do you decide your product pricing?
A few months ago, by the end of May, I changed Legendsverse's model to subscriptions (again), and things look... fine?
I have no idea.
Legendsverse's growth last month was huge, but this month not so much.
Currently sitting at $95.
I hope to reach $100 MRR by the end of the month 🤞🏽
But I have no real strategy. I think what has worked best for Legendsverse in the past is to share features on Reddit and commenting other posts with links to the checklist and price guide.
Before having subscriptions I had an OTP of ~20 bucks, and I also used to accept Paypal, but since I don't feel like figuring out PayPal subscriptions I left that out.
I'm planning a soft pivot for Legendsverse (I'll talk about it in another post), and I may need to decrease the pricing a little.
But man, every time I have to work with pricing I get so anxious.
What if the last pricing was right and this is wrong?
I'm curious how other fellow indie hackers feel about changing the pricing model, and the actual price of their products?
We've been building our own product strategy recently and will be launching it in the next few weeks. I wrote a blog post detailing our approach and thinking. Hopefully might be useful: https://kinde.com/blog/startups/building-less-shitty-pricing
Added your blogpost to my reading list, hopefully will be able to read it later today after my day job. Thanks a lot!
to final, the pricing of the product competitors' research is the most important thing.
Yeah, the most difficult part I guess, is that my product is the only paid product in the community, all the others are "free", but they have ads, affiliate links, and so on.
My main concern I guess is that the community is used to this kind of free website.
And it's kind of hard to convince them otherwise.
A rule for small startups in their early days - take your current pricing and double it.
It's all too common for new-comers to undersell themselves. If your product brings value, people will be willing to pay for it.
Every time I increase it I get so anxious 😂 and actually I'm thinking of lowering it again.
But haven't pulled the trigger.
It's super scary right?!
Good luck :)
The best way is to see your competitor you can charge according to them this will be the best.
It costs 30 dollars a year.
And your customers have collections that are worth thousands?
Your pricing is certainly not too expensive.
Your growth problems aren't coming from your product or your pricing (people are already paying you money for your solution - not much, but some).
It's your marketing.
You're only selling your product which, as I go into on my website, is the least effective way to grow a business. But that's too big of a subject to go into on here so you can check out the website (thebluntmethod.com) if you wanna learn more.
Now, concerning how high or low you should price, the question you've got to ask yourself is how big is this market? (I'm sorry but I know little about marvel collections so I can't answer this for you)
Let's say you manage to convince 1% of your market to buy from you. Would 30 dollars a year per subscriber generate enough revenue for you?
If not, you probably need to increase your prices.
Of course, there is an upper limit. If you needed to charge each customer 1000 dollars a year to make a living then you MIGHT not be able to make this work (or maybe you can if you position it right).
That's how you need to be thinking when it comes to pricing.
Hey man, this is very interesting and I already read all your linkedIn posts, would love to read more about your ideas. I'm also already considering getting the Blunt method
I love that you love reading my ideas but the best thing for you to do will be to take action with them :-) it's why The BLUNT Method is an action guide with templates and workbooks to force you to take action rather than just giving you information & asking you to get on with it.
thanks! Hopefully I can get it soon
For era.sh we compared with our competitors, see how much impact our features bring and how much the difference is to other note-taking tools, which have those features.
We collected a lot of data and parameters and came up with a good solution.
Does it work? We will see as soon as we leave beta :-) But I have a good feeling about that, as we really cared about it.
Hey, would love to learn about your experience.
In my field there aren't too many paid apps, I think mine's the only one, and the others are "free". Maybe that's why it's so hard to convince people to pay??
If there are no similar products to compare pricing with, then I just settle on a reasonable markup after expenses and if I need to change the pricing I will keep the existing pricing for 12 months and then increase the cost on new customers only.
I recently needed to do this on a service business I offer for hosting bee hives, and it was due to increased expenses and market strategy. I used the first two years for market penetration and now that I have accomplished that, I am increasing prices to become profitable.
That's interesting, what I've been doing is lowering my expenses actually. Currently, my expenses on this app are about $45 + dev time. So I think it's not that bad. But my worry is that maybe my pricing is too high, for the community I'm trying to sell this to.
Split testing new prices works great but you need enough traffic to make it statistically significant.
In the early days I generally use competitor based pricing by simply reviewing similar solutions and testing something in that general range.
Also support feedback you get on pricing is invaluable.
Hey man, thanks for replying. back!
I'm the only paid player in the community. And I think that's the main issue, pretty much everyone expects the app to be free.
Do you think I should ask current subscribers what do they think about pricing?
I generally ask what other tools your audience use which will give you an idea of their typical budget for new tools.
E.g. They may just use a bunch of $10/month tools or $5k/month tools. Very different budgets.
That's interesting. Thanks a lot!
I see three approaches to this.
First, I would estimate the value that your product delivers and make the pricing a fraction of it – 20% or so. Though this may be hard to evaluate for B2C, it can be a starting point.
Alternatively, look at how changes in pricing impact your conversion rates. Tweak it here and there until it works.
The third way is to work backwards. Think of the price you want to charge, and then refine the value proposition (and the product) until it works.
I think I've been doing the second idea most of the time, like I just constantly tweak it and see how everything behaves, but I don't think it's a very reliant approach, since a lot of things can be happening at the same time.