[poll]Software pricing. What do you prefer? subscription or one-time payment?

In this thread I would like to hear your opinions on software pricing models.

I am a seller and I recently released Autofill Magic, a new and unique tool to create high quality back links.

Currently I do not offer any lifetime license, but since several users have requested that, I am investigating the option.

My current prices are $12.99 per month or $87 per year ($7.25 per month).

There is a nice flow of new users, but maybe we could do better?

The math is quite interesting.

Lets say that 100 users are willing to pay $87 per year. That is a net profit of $8.700 after the first year.

But lets say that two out of three potential buyers decide not to buy Autofill Magic because they don't like the subscription model.

Then we are actually loosing 2 x $8.700 the first year in lost sales.

Now lets say we did offer a a lifetime license for $87. Then we would not loose any sales to those who dislike subscriptions and we would be able to sell 300 lifetime licenses and not 100 subscriptions.

The result after the first year would be 300 x $87 = $26.100.

It would take three years to reach the same result with a subscription based model.

But can this example stand a real life test? What is your opinion? Do you avoid subscriptions? Do you like them? Why?

Please vote and tell why you voted as you did.

Thanks

If its a one off product, then you can have a single life time license. Else, if the app is being updated constantly, you need the money flow all through out. If it was me, I would stick with subscription.

Hey OP, congrats for your program and your success. Nevertheless, I would guess there are other ways to promote your products.

Hmm.. I quickly looked over the math, I think you might've mis-calculated something. (or I just overlooked some details)

Either way,

From a consumer's POV, I personally don't like subscriptions if they're added on top of the sale price. For example, some software you have to buy and then pay a subscription on top of that.

I like how you have the subscription and the yearly set up. It allows the user that doesn't have a lump sum of cash to spend to still be able to get a hold of the product.

As far as lifetime goes, you would have to find a price that you won't find yourself loosing money on.

People that are asking for a lifetime should be generating a bit more income, thus their willing to spend a larger lump sum.


I quickly calculated a price for you: $249


How did I arrive at this number?

You currently charge $87 yearly. I assumed that the average person would use this for about 3 years, so I multiplied the yearly ($87) by 3 (for 3 years)

The total there is $261, but because you typically want to make it a better deal (lower price) for those who are buying the lifetime (because of the lump sum payment) I looked for a lower price.

The price I picked was $249 (psychological reasons) and then divided that by 36 (3 years = 36 months) to find what that would equal to monthly. If they buy the lifetime, their monthly is lower = $6.92 (lower than the yearly rate)

Price Chart:

Monthly: $12.99
Yearly: $87.00
Lifetime: $249.00

Good Deal.


The only problem with lifetime's is that they're a little harder to keep people from sharing them along so just make sure you have a nice little verification system in place.

Best of luck with your business. I just went through and took a look at your thread, looks like a nice little tool to have for Tier 1 links. (Not sure if it offers proxy support or not, but it would be a nice option to have.)

You should offer lifetime offer, as Autofill Magic will not last long. There are roboform, lastpass, magic submitter, and all other kinds of software to automate process like autofill magic, and roboform is free. Autofill magic will lose a lot of subscribers at a fast pace and eventually out of the game. So lifetime offer is the best way to go for. Personally, I like autofill magic I will purchase the lifetime offer if there is, there is no one like to pay monthly/yearly subscription.

$249 if you offer at this price no one will ever buy autofill magic. $87 is also consider quite reasonable, as roboform is free to use and it do the same as autofill magic.

Here are my opinion...

Autofill magic is a good firefox plugin, but as GAdsense mentioned, there is roboform which is free I rather use a free plugin like roboform or MS to fill up the form. I will prefer one-time fee rather than paying monthly/yearly fees for a tool to fill up forms.

Plus, if I were you, be smarter please. Since there are people who don't like to pay yearly/monthly fees. Then just offer limited time of lifetime offer of autofill magic.

Here is my explanation.

If you don't offer lifetime offer for autofill magic. You lost money as some people don't like to pay for subscription. But if you offer both options: subscribing and lifetime offer. You will get more money. Understand? You can just offer limited time for lifetime offer like senukeX CR, thebestspinner, kontent machine.

If you offer both subscription + limited time of lifetime offer = you will make more money.

Limited time of lifetime offer = people will quickly buy it before the offer closes. You make big money and plus all the users who are paying for subscription fee.

If you don't offer lifetime offer you are really throwing money to the pool of SEA.

If you sell autofill magic for $150+, I will rather use roboform(free) to form up my forms. A ideal price will be around $100 for lifetime offer.

Since there are buyers who are interested on lifetime offer you should offer that option too but for limited time. If you don't offer lifetime offers for these buyers you are losing a lot of money. eg. if there are 30 people who are interested on lifetime offer for autofill magic.

$80 * 30 = $2400 USD.. (you lose $2400)

You lose a huge amount of money if you don't offer lifetime option. One point is that when you offer limited time offer people tend to quickly buy it so you make a quick profit. If you are only offering monthly/yearly subscription then you will LOSE (all the customers who are interested on lifetime offer only). Which may be more than $10k. I personally also hate paying for monthly/yearly subscription, I rather pay one time fee.

If you offer lifetime offer for limited time + subscription = you make most money out of autofill magic.

As mentioned roboform is FREE to use, how many people will really subscribe on autofill magic?

sn0rt said:

Hmm.. I quickly looked over the math, I think you might've mis-calculated something. (or I just overlooked some details

I quickly calculated a price for you: $249

Price Chart:

Monthly: $12.99
Yearly: $87.00
Lifetime: $249.00

Click to expand...

I appreciate your thoughts and I would not mind selling Autofill Magic for $249 at all. But I do not think that it would work. People who would pay that much would also pay for the yearly subscription.

What I am trying to find out is if a lot more would buy the product if the price is lower. If three times as many users would buy Autofill Magic for $97, then it will be a better business to have a lower price. It seems that the sweet spot for SEO software is around $100. Adding a lifetime license for $249 would not bring more users I think.

Autofill Magic vs. Roboform and other free tools

GAdsense said:

You should offer lifetime offer, as Autofill Magic will not last long. There are roboform, lastpass, magic submitter, and all other kinds of software to automate process like autofill magic, and roboform is free.

$87 is also consider quite reasonable, as roboform is free to use and it do the same as autofill magic.

Click to expand...

WordTracker said:

Here are my opinion...

Autofill magic is a good firefox plugin, but as GAdsense mentioned, there is roboform which is free I rather use a free plugin like roboform or MS to fill up the form. I will prefer one-time fee rather than paying monthly/yearly fees for a tool to fill up forms.

Click to expand...

WordAi said:

As mentioned roboform is FREE to use, how many people will really subscribe on autofill magic?

Click to expand...

If the impression is that Autofill Magic and Roboform are more or less the same, then I have done a bad job explaining what Autofill Magic is about. Autofill Magic can do a lot more than filling a few sign up forms.

First of all Autofill Magic needs no configuration. It works 100% with the sites in the collection. And it also work with any other site. With other form fillers you need to do the configuration before they work. Autofill Magic just works! another iimportant difference is that Roboform can not fill Rich Text Editors. That makes it unable to fill in any article at any web 2.0 site. Autofill Magic can do this with a single click. There is also a bunch of other features that free tools do not provide.

I made a comparison table to point out how Autofill Magic is different than Roboform.

[TABLE="class: grid, width: 700"]
[TR]
[TD]Feature
[/TD]
[TD="align: center"]Roboform[/TD]
[TD="align: center"]Autofill Magic[/TD]
[/TR]
[TR]
[TD]No configuration needed
[/TD]
[TD="align: center"] [/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Comes with a list of 125 maintained
sites (and growing)[/TD]
[TD="align: center"][/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Can fill Rich Text Editors[/TD]
[TD="align: center"][/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Solves Captchas[/TD]
[TD="align: center"][/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Collects created links[/TD]
[TD="align: center"][/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Support for spintax[/TD]
[TD="align: center"][/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Can insert links ,images and video in articles[/TD]
[TD="align: center"][/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Can fill forms in several tabs (you can open
100 sign up forms in tabs and fill all of them
with one click! )[/TD]
[TD="align: center"][/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Special randomization features[/TD]
[TD="align: center"][/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Unique user name and profile information
for each site with just one profile. This
would take hundreds of identities with
roboform.[/TD]
[TD="align: center"][/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Auto populate profile info[/TD]
[TD="align: center"][/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Works with flash sites[/TD]
[TD="align: center"][/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Shortcuts to all key pages[/TD]
[TD="align: center"][/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Provides notes with relevant
information about the sites[/TD]
[TD="align: center"][/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Universal (works with all sites even
those who are not in the collection)[/TD]
[TD="align: center"][/TD]
[TD="align: center"][/TD]
[/TR]
[TR]
[TD]Can post unique articles from a folder[/TD]
[TD="align: center"][/TD]
[TD="align: center"]coming soon[/TD]
[/TR]
[TR]
[TD]Export created accounts in a text file[/TD]
[TD="align: center"][/TD]
[TD="align: center"]coming soon[/TD]
[/TR]
[TR]
[TD]Support for proxies[/TD]
[TD="align: center"][/TD]
[TD="align: center"]coming soon[/TD]
[/TR]
[/TABLE]

I like it when software developers give the option to both one time payment and a monthly subscription. That way I can pay less and test the software thoroughly for the first month and if I like it I can always purchase the life time license.

Ning, there is no way to find out whether lifetime offer will more profitable the only way is to try out and start to offer lifetime offer starting at $249 if no one buy then adjust the price. Since there are already several users approached you for lifetime offer you should start to offer them starting from $249 if no one buy then slowly lower the price.

One time payment!

Although sometimes it would be better to have both as an option.

Before you offer lifetime offer please make sure that Autofill magic has a way for license verification that only 1 user per license, to prevent users from sharing or abusing the Autofill magic.

I agree with themoneywizard since there are people who are interested on lifetime Autofill magic just offer them, it is just stupid to offer only subscription option, you are throwing a lot of money to the sea.

WordAi said:

Before you offer lifetime offer please make sure that Autofill magic has a way for license verification that only 1 user per license, to prevent users from sharing or abusing the Autofill magic.

Click to expand...

Thanks for the advice. A feature like that is already in place.

ningning said:

I appreciate your thoughts and I would not mind selling Autofill Magic for $249 at all. But I do not think that it would work. People who would pay that much would also pay for the yearly subscription.

Click to expand...

The price was calculated using a 3 year average. If they use your product for any amount of time they're still getting a better deal than paying monthly or yearly. If they use it over 3 years, it's an EVEN BETTER deal. You can calculate the price using a 2 year average if you'd like (but do you think people would use your plugin only for two years? That's the question)

You have to use a price that would correspond with the amount of time you honestly think your product will sell and be used for.

If you set up a price with a 2 year average:
$87.00x2=$174.00
(Yearly Rate X Average Product Consuming Lifespan)

You can use: $149-$169

At $149 the monthly rate would equate to $6.20 (still less than half the monthly and lower than the yearly)
At $169 the monthly rate would equate to $7.04 (still almost less half than the monthly and lower than the yearly)

What I am trying to find out is if a lot more would buy the product if the price is lower. If three times as many users would buy Autofill Magic for $97, then it will be a better business to have a lower price. It seems that the sweet spot for SEO software is around $100. Adding a lifetime license for $249 would not bring more users I think.

Click to expand...

I would allow the consumer to pick any option they want; monthly, yearly, or lifetime. You would also have to keep in mind the adjustment you make to the price according to your target consumers.

The regular joe, can afford 12.99 a month.
The advanced regular joe, can afford 87.00 a year
The BST Sellers and those with development type needs, can afford the 149-169 price range.

You have to believe in your product. It will be worth whatever YOU make it worth. If you believe this is the next big thing, something that offers features that non of your competitors can compete with, then make people pay for it.

Obviously you also don't want EVERYONE to have this as it would cause the platforms to put something in place to defend against these types of software. All it would do is give you headaches due to constantly having to create updates..

Hope this helps..

Thanks for all your good advice.

I have been having many of the same thoughts my self. I have decided that I will offer a lifetime license as an exclusive BHW offer. It will be in the price range $149 - $199. It will be at least a week or two before it is available. Anyone who have purchased the annual license can update for the additional amount. No extra charge.

I do believe in my product and I am sure that Autofill Magic will still be here three years from now. Autofill Magic is the only universal tool that works with all sites without any need for configuration. When people realize that it does not only work with the 125+ sites in the collection, but with any site, then the perspective is big.

If it is the next big thing or not is hard to say. There is no other product like it to compare it with. I think a lot of users want 100% automation, but some end up being disappointed about the success rate, stick rate and quality of the created sites. Autofill Magic is for those who want to put in a bit of extra work to get nearly 100% success rates and all the flexibility and quality that manual link building provides. How big is this group? It is hard to say. I do think that a lot of users will benefit form building there tier 1 links with Autofill Magic and then back them with automated software. A very good strategy could be Autofill Magic and GSA SER. I know personally that it work wonders.

Time will tell. Thanks to everyone for the feedback.

sn0rt said:

The price was calculated using a 3 year average. If they use your product for any amount of time they're still getting a better deal than paying monthly or yearly. If they use it over 3 years, it's an EVEN BETTER deal. You can calculate the price using a 2 year average if you'd like (but do you think people would use your plugin only for two years? That's the question)

You have to use a price that would correspond with the amount of time you honestly think your product will sell and be used for.

If you set up a price with a 2 year average:
$87.00x2=$174.00
(Yearly Rate X Average Product Consuming Lifespan)

You can use: $149-$169

At $149 the monthly rate would equate to $6.20 (still less than half the monthly and lower than the yearly)
At $169 the monthly rate would equate to $7.04 (still almost less half than the monthly and lower than the yearly)




I would allow the consumer to pick any option they want; monthly, yearly, or lifetime. You would also have to keep in mind the adjustment you make to the price according to your target consumers.

The regular joe, can afford 12.99 a month.
The advanced regular joe, can afford 87.00 a year
The BST Sellers and those with development type needs, can afford the 149-169 price range.

You have to believe in your product. It will be worth whatever YOU make it worth. If you believe this is the next big thing, something that offers features that non of your competitors can compete with, then make people pay for it.

Obviously you also don't want EVERYONE to have this as it would cause the platforms to put something in place to defend against these types of software. All it would do is give you headaches due to constantly having to create updates..

Hope this helps..

Click to expand...

Ning, what is the lifespan of autofill magic? As I want to use it permanently once I purchase the lifetime license.

WordTracker said:

Ning, what is the lifespan of autofill magic? As I want to use it permanently once I purchase the lifetime license.

Click to expand...

The plan is to maintain and develop Autofill Magic for many years. There is absolutely no plans of stopping the maintenance and any point.

In my opinion, I hate subscriptions. I want to feel like I own the product. I don't want to fork out money for software that has a time limit on it. That's like paying for trial software that stays as a trial. I would much rather pay a little more and have the thing forever.