Is offering a one-time payment stupid?

blackkatemoss

blackkatemoss

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A one-time payment for an offline version.
I operate a low-cost SaaS that does about $500,000 a year. Churn is quite low, and LTV is about $250 per user.

Would it be totally stupid to offer a one-time purchase equal to LTV for an offline-only version of our application?

I’ve actually built my application local-first; it works offline just fine. My business model is SaaS because it’s easy and we do have online-only features, but I wonder if a dual model would get more money on the table? Many users have emailed us asking for a one-time, offline option.

Does a dual model work? SaaS for app + online features, and a one-time payment option for offline usage and one year of updates?

Thoughts?
 
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It is always enticing to just pay once for something, not subscription. It's always tempting to buy the lifetime option because of the vision of saving money in the future for this service. So I think if you can afford to give out your SaaS like that, then go for it.
 
Nah, not stupid. Some clients actually prefer paying once and being done with it. Just make sure you're not undercharging and killing your own time. Could even use it to build trust, then pitch something recurring if it makes sense later.
 
If the standalone version doesn’t require ongoing maintenance costs on your side and the price equals the LTV, then it’s a good deal. In all other cases, you’ll end up paying out of pocket after the LTV period.
 
The main idea behind a SaaS is to make you RECURRING income from RECURRING subscriptions = renewals.

I won’t encourage a one-time payment SaaS as it may inadvertently repurpose potential subscription/recurring customers who would pay monthly anyway into a one-time.

One time payment is good for one time conversion and that says so much about it. I have been on both ends of the spectrum and I can tell as a business owner I would always prefer the recurring subscription option even if that means losing a few potential one-time customers.

It’s also about loyalty, you get to know who stays earlier especially if you have a solid product people care about.
 
One-time payments always give the impression that someone might disappear soon.
 
Since the payment is one-time, you should be suspicious of something.
 
Think its best to do a combination between one-time purchase + available to buy upgrades or extra modules that later. Or combination between one time and subscription. It all comes down to what you're selling, does it need frequent updates, servers, etc.
 
OTP is beneficial for customers and you can apply it if it does not affect your revenue, this is a problem of monthly and permanent customer usage rate. Will have to calculate very carefully about money
 
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