Charging less while in early alpha/beta?
The product I'm working on is still somewhat buggy and slow, and thus the value the customer gets out of it is less than if those kinks would be worked out. Do you recommend charging less in this stage?
Also, how much less? 😊
Hey @nickjanssen 👋
Some people will probably tell you to not undersell your product/work because it is not giving a good signal and can be interpreted as admitting that your product is bad/boring/uninteresting/feature lacking...
Let's be honest here, all of us are all looking to get the best deal out of everything. I've had hundreds of calls with C-level executives and one thing stood out, they were all looking to spend ad little as possible!
A lot of them talked about expenses as if they were paying themselves and made a weird connection as if B2C (things they are buying personally) = B2B (things they are buying for the company).
One of my co-founder and myself are gamers and you probably noticed that the video game industry is widely using the "early-access" business model. As a consumer, it is a great way to engage with the dev team and support them as well. The video game industry is silently taking over the entertainment world, so they probably got this right!
This is why with my teammates, we decided to not charge 'full price" during our early-access and are currently offering a highly reduced monthly sub to access our platform (abyssale.com).
We are around 30 to 50% less than what we intend to charge at launch.
Hope this made sense ;)
Hey @NxAlessandro! Thank you for the detailed reply.
I agree with you, and it's funny that you bring up the game industry because I also had to think about that. Remember how Minecraft had alpha and then beta pricing? First 50% and then 75% off.
Regarding the C-level executives wanting to spend as little as possible - the thing is though if you go too cheap you lose credibility, so I'm not sure this holds true 100%;
I'll think about this some more but I'll likely go for a 50% off while we're in beta status.
I do agree that low prices = low expectations (this is natural).
However, this pricing strategy won't make sense when you officially release your product! Right now you are looking for beta user willing to pay... You can be cheaper now, not when your product is "gold".
Makes sense. Cheers!
Note that not charging may get you more early users but you will not be able to get quality feedback on a key metric. Price.
One thing to keep in mind is that market positioning and perceived value can be a major factor in testing a product. If one of the goals of your Alpha or Beta is to validate market demand, offering it at a substantially different price than the true market price could give you false positives/negatives in that validation.
Fair point. I wonder if this can be alleviated by making it very clear that the price is 50% off while in beta only and they will soon go up.
The best advice I saw was have it discounted so 50% or 75% off.
That way when you do upgrade it won't be a surprise.
I'm in a similar boat, so thanks for prompting this discussion!
It'd be best to provide less features but tested and optimized.
If it's not possible for some reasons, charging less or even nothing - is good idea.
First you need users, you need feedback, so every move that gets you that is good :)
When I’m launching the products the thing I want more than anything in the beginning is honest feedback. So I would give it away to anyone who can give you useful, actionable input.
BaseCamp allows people to grandfather in rates. If you buy it now for $99 per month and in a year it becomes $149, you still pay the $99 - unless you cancel.
You can make it where people buy today and pay far less while you work out the bugs. As a thank you (and reason to buy now), you will lock in that rate for as long as they are a customer.
Grandfathering is always the way to go. In fact, you cannot not-grandfather in prices or you are guaranteed to piss off customers.
How do they communicate this?
They use to say it on the website. Now, it is only told to paying customers.