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Andy Brice
Successful Software

Doug Nebeker ("Doug")

Jonathan Matthews
Creator of DeepTrawl, CloudTrawl, and LeapDoc

Nicholas Hebb
BreezeTree Software

Bob Walsh
host, Startup Success Podcast author of The Web Startup Success Guide and Micro-ISV: From Vision To Reality

Patrick McKenzie
Bingo Card Creator

What do you think about this pricing scheme?

I have program for servers, but some admins can use it on the workstations in office.
For some reason I cannot use Std/Pro separation for this program.
But I still think that we need to cover as more users as possible, those who are always buys the most expensive and prestigious versions without a doubt, and those who are looking for much cheaper solution.
Here is what I came up with:

High price - lifetime updates/upgrades.
Medium price - one year or minor updates only (standard shareware scheme).
Low price - ability to use current version only with no free updates/upgrades.

What do you think about it?
Don Pedro Send private email
Tuesday, July 02, 2013
Lifetime guarantees can be problematic, it's been discussed here a few times.

Snap On Tools has a lifetime guarantee that I believe in since they've been around for a long long time and are well known.

Others, not so much.

Lifetime pricing with software often ends up creating an abandoned product, no income, no updates.
Scott Send private email
Tuesday, July 02, 2013
Rule Number 1 of selling software:

1. Do not sell or promise free life-time upgrades or support
Blocky Send private email
Tuesday, July 02, 2013
Why do you think that everyone will buy the most expensive license with lifetime updates? I think there will be very few people who will buy this version. Could it be such a big problem?
Don Pedro Send private email
Wednesday, July 03, 2013
Lifetime upgrades is a bad way to differentiate. Better throw in premium support options (phone support?) or some other services.
Dmitry Leskov Send private email
Wednesday, July 03, 2013
Ok, maybe the following scheme is better?

Normal license - with minor updates.
Economical license - without updates.

Or is it all very confusing for corporate environment and system administrators?
Don Pedro Send private email
Wednesday, July 03, 2013
> Economical license - without updates.

That one would be called Community Edition. And be free.
Vladimir Dyuzhev Send private email
Wednesday, July 03, 2013
And no one will but the Normal license.
Don Pedro Send private email
Wednesday, July 03, 2013
"will but" -> "will buy"
Don Pedro Send private email
Wednesday, July 03, 2013
From what you're saying, it seems you'll be selling your product to companies. Businesses will always pay for support year after year so they're covered.

Offering lifetime support is leaving money on the table.

I'd first launch the product with one license type and one price. Listen what customers think about it, gather feature requests and then build a pro version with the new functionality.
Jose Send private email
Wednesday, July 03, 2013
+ lifetime updates is a bad idea.

Also avoid giving a free version without updates because how will you track and/or monitor that? What's to prevent me from pretending to be a new customer each year?
Stephane Grenier Send private email
Thursday, July 04, 2013
Sorry I meant low price. But same idea. How do you monitor that? What's the difference between low price with no upgrades and medium price with upgrades? Why wouldn't I just get the low price and upgrade when I need to?
Stephane Grenier Send private email
Thursday, July 04, 2013
Why don't you stop tossing pricing schemes in the air and tell us what sort of market segmentation you want to achieve, and why you think that would increase profits (not revenues) in the long term?
Dmitry Leskov Send private email
Thursday, July 04, 2013
The problem with this type of scheme is that it's not clear what you get.

If I buy the budget version, will the vital bug fix be considered a major update ?

If I buy the expensive version, will the major updates be relatively minor ?

If you have 2 versions; one does X and Y; the other does X, Y, Z and Q. It would be better.
koan Send private email
Thursday, July 04, 2013
Without knowing your product, it's difficult to know if this suggestion is useful:

Offer a "Server" and "Workstation" version of the product. It may be the case that they are functionally identical except for the support commitments "This will work on your server"and "This will work on your workstation".  If you can distinguish the environments you could enforce this - and you can enforce it if a support request arises - but it may not be necessary.

Despite other people's comments, (a client I do some work for) has had tremendous difficulty selling long term support / differentiating prices based upon 30 days vs 1 year's support. Buying extended support contracts or renewing support contracts is the exception rather than the rule.  It's only  a single data point, but depending upon the application and its criticality to the business, support can be a difficult sell.  Your software, is, after all, supposed to work and unless there is a service aspect to it or disruptive changes in its environment which require frequent upgrades, the "added value" of a longer term support contract may be questionable. Some IT departments take the view that "if there is a problem we will purchase the latest version".

"One year of Unlimited telephone and email support" does seem to be something users see as valuable, however - even if they never take advantage of it.
Mike Bell Send private email
Friday, July 12, 2013

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