🤔 Why did we include the Lifetime Deal option in our go-to-market strategy?
Well, maybe many of you will say it wasn't a great idea for a SaaS company but let me share some interesting facts.
1️⃣ When you first launch a product, people think that that's a scrappy tool they are not ready to pay for.
But when they see a Lifetime Deal for only $89 they start thinking.. "okay, this company seems to have great potential and $89 is not too much". And they finally pay for the service.
2️⃣There is a huge fanbase of Lifetime Deal offers. Once someone notices a useful service for a low price, they share it across all social media platforms. That's how the newly launched website traffic increases dramatically.
3️⃣LTD users are good testers. Even before purchasing the service, they will crawl the internet to find similar products, they will test features, compare pricing, functionalities, usability, friendliness, etc.
If they happen to finally choose your service your product receives a great amount of feedback. They will for sure compare your software with your competitors offering a similar product/service.
Believe me, even though you may think you know all your competitors, LTD users will add new ones you didn't know existed.
4️⃣ Well, you may think that $89 for lifetime usage is not fair. That's right.
That's exactly why you want to make sure to have some additional functionality and upsell features before you run the LTD campaign. These have huge potential to convert users into regularly paying customers if additional features are of a monthly subscription or recurring customers if add-ons are of a one-time purchase model.
5️⃣AppSumo is a great platform for launching your LTD campaigns. They have a great helpful team and a huge community of followers and ambassadors.
When agreeing on the deal with AppSumo, their professionals help build an attractive product page and increase your brand awareness.
And because AppSumo chooses collaboration products after a careful selection process people already know your product is among the special ones having a bright future. AppSumo helps bring deals and the first userbase.
So, if nothing else is planned, like ads or special promo campaigns, this may be the best way to go.
How have you gained your first users? I'd appreciate comments on your post-launch experience.
LTDs sound scary to me. It’s basically adding a dead weight to your platform. It adds load to your infrastructure and adds fixed monthly expenses that don’t give back any return. It builds capital at the start but after a while you’ll get to a point where that dead weight costed more money than what you’ve got for it in the first place.
So except for the short burst of income and marketing I don’t see it as a good idea. I guess it really depends on what kind of service you offer, what kind of infrastructure you need and how much a user costs you per month.
Certainly, it's worth considering the infrastructure and 3rd party services you're utilizing. As previously noted in one of the comments, acquiring early-stage users can be immensely valuable for gaining insights into your target market, and using this knowledge and experience could expand the business and make it better.
Fair enough, I’ll have to agree with that. Nothing beats that kind of early feedback. That’s sure one way to do it in this case as long as the overhead fees aren’t too high ie. like with AI generated content.
Exactly 👍
Nice points but personally, I'd be wary of the short term high of offering LTDs at launch vs having to support that customer for the lifetime of the app without getting another dollar from them.
Having been through an exit with my apps, I know that amongst other things, potential buyers want to know the percentage split of active subscribers vs lifetimes. Having a high number of LTD customers is basically baggage for them to support going forward and will devalue the deal for them somewhat.
To be fair, point #4 basically nullifies the risk of the LTD. If you're launching a true MVP, then realistically very few users won't upgrade, particularly your first cohort of users since they should feel the pain point most acutely and would therefore benefit the most from incremental features
Hi @ktm55,
Well said, I agree that if you have a true MVP and are able to identify and address the pain points of your target audience, there is a good chance that your first cohort of users will upgrade to a paid plan.
Indeed, identifying your target market and achieving product-market fit can be challenging in the early stages of a SaaS business, and running an LTD can be a great way to validate the market and gather feedback from users.
As someone who has bought lots of LTDs, this makes me wince ... "have a plan in place for transitioning LTD customers to regular subscribers"
There's nothing worse from a customers perspective than buying a lifetime deal for the founders to reduce your usage or force you on to a paid plan. IMO, it goes against the whole ethos of offering a lifetime deal and users react quite angrily towards it in my experience.
For that reason, we hold our early adopters in high regard for their investment in our product, and as such, any plans for transition should not impede upon the functionality for which they have already paid. :)
Hi @rickblyth,
Thank you for your comment.
I completely agree with your point that LTDs can potentially create issues during an exit or when seeking investment. It's important to have a clear plan in place for transitioning LTD customers to regular subscribers and to ensure that the pricing model is sustainable in the long term.
In addition to having a clear vision for the LTD campaign, I believe it's also important to consider factors such as customer acquisition costs and customer lifetime value when developing a pricing strategy. This will help ensure that the business is profitable and sustainable over the long term.
P.S. ARR and MRR are one of the key metrics when you sell your SAAS business or when seeking investment.
I first tried LTD deals initially for my new SaaS and was surprised by the result. I was able to sell LTD for $2,350 and that gave me the motivation to keep working on the project.
I talked about it here:
https://twitter.com/AlexBelogubov/status/1625921633813659673
Hi @AlexBelogubov,
Thank you for your comment, and I'm glad to hear that you had a positive experience with a lifetime deal for your SaaS product. It's always great to get that initial boost of motivation and validation that comes with making some sales.
Thanks for the post! Did you spend any time trying to grow MRR while running your lifetime deal?
I always think an interesting question with lifetime deals is: How many of those users would've been paying customers were it not for the deal?
Hey @WilliamPaul,
Thank you for taking the time to leave a comment.
While we did run a lifetime deal campaign, we also focused on offering additional features and services that customers could subscribe to on a monthly or annual basis. We put a lot of effort into making these add-ons as valuable and useful as possible for our customers.
Regarding the conversion rate, we have seen around 7-8% of our LTD customers convert to regular subscription payers. While this may seem like a small percentage, we believe that the long-term value of these customers is significant. Moreover, we are continually working to improve our product offerings and customer experience to ensure that our customers see the value in continuing to use our product and services.
If you have any further questions or comments, please don't hesitate to reach out.
P.S. In summary, I believe that LTDs have their place in the market, but they should be used strategically and with a clear plan for transitioning to a more sustainable pricing model.
Hey Boris,
Appreciate the response. That sounds like a great way to approach it, particularly if 8% of users are upgrading.
Did you get any negative feedback doing this? I understand that many lifetime deal users expect every feature on the roadmap to be included free, regardless of mounting costs.
Thanks again.
We are striving to ensure that every transition is seamless so that our LTD users can feel at ease with any changes.
Thus far, we have not received any negative feedback on this front. :)
Thank you for sharing your thoughts on this!
You're welcome!
How do you not fuck up pricing?
It's important to remember that pricing is not a one-time decision, and you may need to adjust your prices over time as your business grows and changes.
So not LTD pricing then?
Then regular pricing for those who didn't buy LTD. To convert LTD users into recurring payments we sell add-ons.
It's fascinating to hear how offering a lifetime deal can be an effective strategy for attracting early users and building momentum.
I completely agree! Offering a lifetime deal can create a sense of urgency for potential customers who don't want to miss out on a great deal. Additionally, it can create a sense of loyalty and commitment from early users who feel invested in the success of the product.