Why don't more companies experiment with only offering yearly pricing?
Almost every SaaS pricing page I see offers monthly pricing. It's rare to see a company only offering yearly plans.
I understand that it's a risk, but if it works, your foundation for cash flow is so much stronger. Your company is instantly more valuable because of that.
Why don't more companies experiment with this?
Curious to hear your thoughts.
I don't pay yearly for products unless I need and trust them. It usually takes me one or two months of usage to decide whether I should pay yearly.
So unless the product:
I most likely wouldn't pay yearly for it.
I'm sure most businesses would prefer to let customers like me who are super skeptical pay monthly rather than not use the product at all.
Super useful and interesting. Thanks for sharing! I think I might be in a less common camp of people more willing to pull the trigger on yearly if I think it's useful after the free trial. I always buy the yearly packages to save the two months or whatever the deal is.
Exactly what I wanted to say
Oh, I plan to do a mix. One-off purchases and a yearly subscription for everything. A lot of marketplaces use this tactic so that someone doesn’t just subscribe for a month, download all their content, and cancel. The one-off purchases are nice so that users don’t need to buy the entire subscription just for one item—if they want multiple items, then the subscription becomes appealing. Anyway, it depends on the market
Agree with what @johnt2021 and @WilsonSquared said. On top, the annual subscription typically gives 2 months off,so it's only ten monthly rates. So users have an incentive to subscribe annually.
But why not, maybe have a try, coupled with a generous free trial (plus crédit card). That could reassure hesitant users (and maybe some forget to cancel :-) ).
And report back here.
Yes I will definitely report back if we go this route.
Simple. It's hard enough (really really hard) to get someone to subscribe monthly.
Yearly, it's 12 times harder.
Makes sense that you'd be adding yet another obstacle. But I wonder if it's actually 12x harder. Would be awesome to see some data on conversion rates across two cohorts of yearly only vs. monthly + yearly discount.
I temporarily offer a lifetime license to get initial users, but on the long term, I offer both monthly and yearly.