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Pricing Software - Some Considerations and Techniques

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db90h:
You can do all the studies in the world and you'll eventually arrive at the conclusion that consumers willing to pay for a good or service will pay what they consider a reasonable price, while those who will not pay, will not pay any price, no matter how low. I've never increased volume by lowering my prices either. I wish I could say I did ;o. Then we could really lower the cost of software.

Renegade:
You can do all the studies in the world and you'll eventually arrive at the conclusion that consumers willing to pay for a good or service will pay what they consider a reasonable price, while those who will not pay, will not pay any price, no matter how low. I've never increased volume by lowering my prices either. I wish I could say I did ;o. Then we could really lower the cost of software.
-db90h (October 01, 2011, 12:31 AM)
--- End quote ---

I can absolutely say that lowering prices works... if you do it right... which in the software world, a lot of guys don't...

The problem is one of setting a proper base-line. Once you have that, you're set. If you don't have a base-line, you're hosed and lowering prices will only hurt you, in general.

I posted a little bit on that topic here:

http://cynic.me/2011/09/15/creating-urgency-for-sales-with-infralution-licensing-system/

I'll post more in the future, but that's the general idea on how to lower your prices properly. (There are other ways, but that's one that works.)

db90h:
I will research and study your methods, if this is true it is a paradigm shift for shareware authors still selling their software.

Renegade:
I will research and study your methods, if this is true it is a paradigm shift for shareware authors still selling their software.
-db90h (October 01, 2011, 02:17 AM)
--- End quote ---

I wouldn't say that it's a paradigm shift. The general strategy has been used for a long time in retail, and also in software, though not so much in software.

I haven't backed up what I posted with a lot of empirical evidence because I simply don't have the time to collate it all, and even if I did, I don't post numbers for GDT (which is where I get a lot of the information). Other information I have I cannot post because it doesn't belong to me.

However, it's not all that difficult to try it out for yourself. I've posted other information about how I'm integrating ILS, IPN.NET, PayPal, and TrialPay into some software that I'm about to release very soon. While the details might not be relevant to you, the general principles are in line with what I wrote in the other post, and can serve to help get a system that works for you up and running.

The flow chart that I posted might help some. Most of the logic is in the first decision process. I've not posted on that too much, but once I've released, I hope to get back to that and post some results along with a longer explanation of that first decision process.

Renegade:
I just got my copy of ASPects today, and there's an article in it on software pricing by Al Harberg.

...software developers should base their prices by figuring out the value of the product to their customers.
--- End quote ---

It seemed obvious to me...

“Higher prices don’t just talk,” Beckwith insists. “They tempt.” My 25+ years of marketing experience in the software industry confirms this belief. In the software industry, most developers will tell you that their Pro version outsells their Standard version.
--- End quote ---

I've heard that elsewhere as well. From my own experience, I can say that it works.

There's a lot more good stuff in there, but... You must be an ASP member to get a copy of ASPects.

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