* The Business of Software

A former community discussing the business of software, from the smallest shareware operation to Microsoft. A part of Joel on Software.

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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

Increased my price and made another sale!

In this thread...

http://discuss.joelonsoftware.com/default.asp?biz.5.860477.11

...Doug said: "One other thought: price is a signal for quality.  People don't appreciate and respect $10 software, even if it's truly awesome and amazing."

I didn't really think much of that advice, but then again, I've had only one sale for one of my apps that was being listed for $9 on my website.  So I figured, what the hell, let's try it, and changed the price from $9 to $49 (a massive 444% increase!) and you guessed it: less than a day later, I got my second sale for that app!

Proof:  http://i.imgur.com/NHmQdBE.png

Unbelievable!  Thanks, Doug!  :)
PSB136 Send private email
Saturday, April 18, 2015
 
 
BTW, here's what I email them in return for their sale.  I'm hoping the special offer at the end will lead to an impulse buy of my other app.  :)

http://i.imgur.com/rTzR23t.png
PSB136 Send private email
Saturday, April 18, 2015
 
 
Interesting, I am struggling between prices $24 and $28 for security software, if I dont have sales for day or two I lower the price to 24 or $20 and vice versa but I will try with $33 or higher , maybe it will help
Damjan Send private email
Sunday, April 19, 2015
 
 
OMG, my other app which was also $9 originally, and which I changed to $19, just made a sale!  That's a 111% increase in price and the first new sale since February.  Very interesting indeed.

I like these notifications: https://i.imgur.com/h0j2XPN.png
PSB136 Send private email
Sunday, April 19, 2015
 
 
I agree with the price as signal point, but I also suspect that many people simply barely look at price as a limiting factor. That is to say, they spend on what they want and rarely factor in price. I know this flies in the face of classical economics, but I get the sense it is true. I have a friend who sold a car to fund a 40th birthday party, and other examples. Sure, there are limits to how far you can push it, but I'm always surprised how much people just ignore price as if money were unlimited. I almost think the biggest separator is the "I'll only acquire this software if it is free" vs. the "I am willing to pay money for this software", and once you're into the second camp, price matters less.

Congrats, PB!
Racky Send private email
Sunday, April 19, 2015
 
 
PSB, don't call it a refund call it a discount.

Refund calls to mind defective merchandise.
Scott Send private email
Sunday, April 19, 2015
 
 
Thanks guys!  :)  And good point, Scott; I'll re-word that part.
PSB136 Send private email
Sunday, April 19, 2015
 
 
Goodonyamate!
Marcus from London Send private email
Monday, April 20, 2015
 
 
Congrats!!

Besides price indicating quality, there is another aspect that (to me) suggests increasing the price: trust.  In a non-paypal situation, giving your credit card number to a website is a risky proposition.  An app worth $10 is maybe not worth that risk.  An app worth $99 is more worth the risk, because the app is more valuable -- the risk/reward ratio changed.  And, perhaps the company with the more expensive software is more stable/legitimate and less likely to scam.  (In absolute terms I'm not sure it's true, but emotionally that's often how I personally feel.)
Doug Send private email
Wednesday, April 22, 2015
 
 
@Damjan 

Is the security software for business or personal use?  Don't sell anything to a business for less than $49 (or maybe $99).  [I just made that rule up!]

I have an old app I'm tired of supporting that used to sell for $49.  I increased the price to $99 to try and discourage sales (I don't want to just drop it) and still get almost as many sales as before, but with much more profit...
Doug Send private email
Wednesday, April 22, 2015
 
 
it's for home use, I have raised price from 24 to 28 and there was no sales for couple of days then I have returned older price and sales returned in usual range, i will just try to put higher price such is 49 for business users, separate home and business clients and see what happends
Damjan Send private email
Wednesday, April 22, 2015
 
 
Damjan - why do you think that biz will not purchase the personal license? many of the bizs are 1-2 members - I think they will just purchase the personal license no?

Second question to all.
What do you do if on the market there is only one competitor that sales in the same price as you are?
Still think that increasing the price is good idea?
No Send private email
Friday, April 24, 2015
 
 
> What do you do if on the market there is only one competitor that sales in the same price as you are? Still think that increasing the price is good idea?

Yes, if your app is better.  My app that sold for $19 last week, and sold 4 copies previously for $9 each in February, has about 3 *freeware* competitors.  Why did people buy mine?  I believe it's because it does slightly more than the others, and it's also simpler to use.  The competitors have lists and preferences to be maintained by the user, whereas mine is basically a one-click affair.  As someone in these forums once quoted: don't make your customers think.
PSB136 Send private email
Sunday, April 26, 2015
 
 
Also, my app that sold for $49 last week has several freeware alternatives too.  I even wondered why the buyer paid me instead of using a freeware app, but I wasn't stupid enough to ask.  :)
PSB136 Send private email
Sunday, April 26, 2015
 
 
I have had free competitors for 7 years. Hasn't been a serious issue, because people who really need it just want it to work. Their boss is paying for it, so they don't care. As long as it works.
Darren Send private email
Monday, April 27, 2015
 
 

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