

Selling Tickets with Startup Megatrends - swombat
http://blog.awesomezombie.com/2009/11/selling-tickets-with-startup-megatrends.html

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patio11
Credit to a friend of mine in software: one single trial user is a perishable
resource, because their propensity to convert declines sharply the longer they
have been in your database. Accordingly, before they "age out" it is worth
taking a few stabs at finding an offer they'll respond to.

My friend has no price listed on his website for the software -- you pay the
price the software tells you to pay. There is a bit of a secret sauce involved
but, in general, the idea is that it costs $X on day 0 but you'll be given an
automatic $5 discount on day 5, a bundle deal with a $10 off coupon later, etc
etc.

Other software vendors have expressed skepticism that anyone would ever put up
with this, but he apparently does pretty well for himself.

Incidentally, he has a desktop app but I think you could get _scary_
sophisticated with a web app for this, because you can make the marketing
correspond to user behavior. For example, I got bored one day and implemented
a FAKO score (like FICO, except fake) which predicts a trial user's likelihood
of converting based on their observed behavior. If I extended that a bit to
take into account some lifecycle related factors, I could hypothetically mail
everyone with "sitting on the fence" FAKO five days into their trial with a $5
off coupon, with the goal of pushing them over.

------
idoh
The downside of yield management is that it upsets the buyers. A couple times
a week I go to my favorite lunch spot, and I know exactly what I'm going to
order and how much it will cost. If one day I walk in at it costs $20 to buy a
burrito, I'd find somewhere else to go and I wouldn't go back.

Also note that a lot of sites would rather run house ads instead of squeezing
every last drop of $$ out of an ad space, for aesthetic reasons.

------
ig1
I'm the author of the blog, so if anyone has any questions on the topic shoot
:-)

