In 22 years I've never raised prices on existing customers. Have you?
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In all 22 years of running my business, I’ve never raised prices on my existing customers.
My philosophy has always been to price a little below the competition, make the product better, and the customers will come to you. That's how I've made it this long.
Normally, for me, it means taking the cost of not trying hard enough on your customers. And if you're selling the product, there's no need to increase the price.
If I ever did raise prices, I think I'd keep all of my existing customers at their current price and only charge the new price to new customers.
I know many other founders do not see it this way, so I would love to know. Have you ever raised prices on existing customers? What made you decide to do or not to do it?
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Not yet, but the product is weeks old, so that's no virtue. What I can add is the subscription-app side of it. On the App Store and Google Play you can raise the price for new subscribers and leave existing ones where they are, and I think that's the only version I'd ever use. A subscriber who gets a "your price is going up" notice doesn't compare the two prices. They just get reminded they're paying, and some cancel who never would have otherwise. So even if you ignore the fairness argument, the math is against it.
Curious about your 22 years: did staying a bit under competitors ever backfire, as in customers reading the lower price as lower quality?
@gbasovv Not sure if it is lucky or unlucky, but the freelance job site I've run since 2004 has never taken a transaction fee like Upwork does today. It has always run on ads and some paid memberships. Around 2008 the word "crowdsourcing" showed up. The fee-based model came with it. Lots of Japanese companies jumped into that model, and a few of them have even gone public. With that business I chose a different model from the start, so price competition was never really a thing for me. Revenue isn't even close to theirs, but it's more than enough to support my family, and there is zero stress.
On the SaaS side, back in 2000 I built my own system that worked a lot like Shopify does now. There were similar services back then, but the free CGI ones were hard to use and the paid ones cost way more than small businesses could afford, so I offered it for around $30 a month and got a decent share of the market. Sadly, my co-founder took it over unilaterally and I ended up leaving it (same thing that happened to Steve Jobs at Apple back in the day). Now I am launching a few SaaS products, and I plan to stick to the same strategy with them.
@hisashispace zero stress and enough for the family sounds like the real win here, the public companies with ten times the revenue rarely get to say that. And losing your own system to a co-founder must have hurt, respect for starting again. Which of the new SaaS products comes first?
@gbasovv Probably Pinateca for now. Kanban boards, Gantt charts, that kind of thing. To be honest though, it's mostly existing services made cheaper and more flexible, so I haven't found that one thing only it can do yet. Where it's easy to see is price. Gantt charts are in the free plan for up to 5 people, while Trello puts them behind Premium at $10 per user and Asana's free plan stops at 2 people. Paid is $5 per user, so 10 people come to $50 a month, versus about $110 on Asana Starter. The part I like most is that I can run all of it through AI agents. And the timetable board I made for my daughter, our family actually uses it every day and it helps us out a lot.
@hisashispace $50 against $110 for a team of ten is the kind of number a team lead can take straight to whoever pays, and a free Gantt chart for five people is a clear hook on its own. Maybe the one thing is exactly that, the cheapest way for a small team to get a Gantt chart. And a timetable board your own family uses every day is the best test there is. Do people sign up for the Gantt chart or for the kanban?
Oh wow great for you and your customers, especially the ones that have stuck around. This builds a lot of trust and loyalty.. wish every business was like this 👀
@amanndaphillips Thanks, Amanda! For me, raising their price would just be passing my own lack of effort on to them ☺️
@hisashispace Yeah, yeah, yeah!! That is exactly what I think about raising. Either don't raise it if it's not necessary, or keep it the same for existing users.
@kushagra_agrawal8 Glad we're on the same page, Kushagra! And if it's selling well, I don't see a reason to raise it in the first place ☺️