* 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

Pricing- should I price my software to match competition

I have a product which is low volume and costs less than $40.I had increased the by price $5 .Got good sales last month but I got few questions about coupons and stufd.The product has more features than the competition.But does the same thing.

So I was thinking should I price compeetively?

Please advice
Testbox Send private email
Saturday, January 30, 2016
 
 
Is this B2C? Consumers are price sensitive. But if you charge less than your competitors, you are basically saying that your software is not as good as the competition (google 'price as signal'). So consider charging more than them if you are saying yours is better.

If nobody is complaining about the price, then its probably too cheap.

Pricing is hard!
Andy Brice Send private email
Saturday, January 30, 2016
 
 
You must think carefully about where you want to position your product in the marketplace. Is your strategy to compete on price or quality or feature set. It is all too easy to compete on price. This is usually where micro isv's go wrong starting their businesses.

The default option: If your product is of a higher quality than your competitors, then charge more. If it is a lower quality/less functionality, then charge less.

Before you introduce your product to the market, invest money and resources into developing a stunning brand. With a great brand, you will be able to put up the price and your customers will be happy to pay.

It is always better to start with a higher price, than a lower price. You can reduce your price, but it can be difficult to increase it.
jamieb22 Send private email
Sunday, January 31, 2016
 
 
How to you create a stunning brand without a product? Genuinely interested to know what you are suggesting here!
Andrew Gibson Send private email
Monday, February 01, 2016
 
 
Over the years my $49 product has moved up to $125 (with some more features), and nobody complains.  So are you selling the BMW or the Hyundai?  If a product is more BMW, people expect to pay for a BMW (Andy's note of 'price is signal' is very important).

So: if selling B2C, increase price by 20% and see what happens

If selling B2B, double the price.  Business people aren't spending their own money so they don't care much if it's less than $500(?).
Doug Send private email
Thursday, February 04, 2016
 
 
I'm about to release an app for $39 that does basically what a popular, open-source app, and totally free app does.  Crazy, right?

Probably, but when I look at the other offering I can't see Moms and Pops using it because it's too hard/technical.  Hell, even when I look at it and its tutorials, my own reaction is that it's too much hassle for the end result.

So I purposely made mine GUI-driven, colorful, pretty icons, and uses English phrases to do its job instead of technical PC terms (eg. "target window" instead of "target hWnd" etc).

I also made sure the things it does can be easily shared with others by having an import/export function that uses plain text, so if my Dad needs it do something, I can paste it in an email to him to import from the clipboard for immediate use without needing to save files and so on.

There's a post somewhere in these forums that says execution is more important than price, so that's how I've designed my app from scratch.  I have high hopes, but who knows.  :)
PSB136 Send private email
Thursday, February 04, 2016
 
 

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