
How to generate more revenue from your web application today - nathanbarry
http://nathanbarry.com/generate-revenue-web-application-today/
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alanctgardner2
I'm dealing with this right now in the worst way. My product actually depends
on a subscription to another service, which is massive and priced ridiculously
(JIRA). It's a hard sell to say that my service is worth as much as the
platform its built on, but it works out that way for some customers.

I was considering dropping the price and making it a long-tail type of
service, but I'm still excited about plowing lots of development effort in.
This just reminds me that for businesses, the difference between 5 and 10
dollars is minimal, but for me, it's enough to keep the lights on
(metaphorically, my office/apartment is very dim). I'd rather try to grow the
customer base the hard way and then keep giving them more value for money.

Edit: my app is FocusTi.me, at <http://start.focusti.me>. I welcome any
feedback, I haven't really started promoting it yet.

~~~
meritt
Btw your font choice looks horrible on Windows (IE9, Chrome, FF):
<http://d.pr/i/qK9i>

There has been a growing number of not-tested-on-Windows sites which need some
serious testing on modern Windows machines because the fonts look _really_
bad.

~~~
alanctgardner2
Thanks for that. I actually develop on Linux, but either way Windows is
definitely most of the market. I'll shop around and see what I can find.

~~~
cowsaysoink
Fonts that are not native always seem to have issues for me on Windows if they
are not big enough.

The best option is usually to use a native font like Calibri or some of the
many other fonts that windows comes with or increase the size of the font
quite a bit.

The font your using looks kind of bad to me on my linux box because it seems
more geared towards headings and larger font sizes because of how condensed it
is.

You may want to consider one of the more used but good looking fonts like PT
Sans or Open Sans

~~~
alanctgardner2
In case my comments - or more likely my design - didn't give it away, I'm
absolutely not a designer. Open Sans was a great tip, and the point about
condensed versus paragraph text was eye opening. I've basically applied those
points now, I haven't tested on a windows box yet but hopefully it's more
legible.

Thanks for the 5-minute font picking lesson guys :)

~~~
meritt
Looks a world better, great job!

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robomartin

      The Book ($39) – 226 copies sold
      The Book + Videos ($79) – 137 copies sold
      The Complete Package ($169) – 100 copies sold
    

In my experience real price elasticity only exists in business books. The
author's example illustrates what tends to happen in real life: something that
is 1/4 of the price rarely sells 4x better than the 1x-priced product. This
generally means that you are leaving money on the table. The problem is that
testing pricing can be a difficult art to master.

In some market segment selling a cheaper product in exchange for volume can
actually cost you a ton of money. In hardware, for example, the customer
looking for rock-bottom pricing will often be the most demanding in terms of
support requirements as well as the expected value delivered.

~~~
alperakgun
I agree. all those price elasticity examples depend on at which point you are
on the demand curve for your individual product offering.

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ergest
The "charge more" advice should be common sense in this day and age. I'm very
surprised it doesn't get taught in college marketing 101 courses. I read a
book on salesmanship published in 1929 teaching the same exact thing to
salesmen and Cialdini wrote at length about this phenomenon in his book
Influence.

~~~
nathanbarry
You're right, it should be common sense, but it's not. Just look at all the
"Show HN" posts. Charging too little is still a very common problem.

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fbuilesv
Some advice from a prospective customer: if you can't/don't want to offer free
plan, at least give me a trial that's long enough to actually try out your
product. Two great examples that come to mind:

1\. Mixpanel vs. Kissmetrics: Mixpanel gives me a free account that I can use
for as long as I want to evaluate all the stuff I can do with it. KM gives me
a 14-day trial. I'm the only developer working on this project which means
that 14 days is not enough time to implement the changes I need and actually
start to see the results. Going with Mixpanel for this one was obvious. I will
reach their free 25k data points way before the first month so I have to get a
real paid plan or put a banner on my website. In any way, they won already.
Even if I wanted to switch to KM for the lower prices, exporting the data I
currently have would be a hassle.

2\. The New Basecamp: Although they don't offer a free plan anymore, they do
have a 60 days trial. They don't really lose much by offering those extra days
and after two months I'm already hooked to their service, I know how
everything works, and most importantly, they have my projects tied down. The
work of those 2 months is already there so even if I don't like the product,
I'll probably pay for it so I don't have to export it. Joel Spolsky has a
great article that talks about this retention thing (his specific example was
with email providers) but I can't find it right now :(

~~~
whatusername
Rob Walling on Startups for the Rest of Us had a different take on it. One of
the things that dropping to a shorter (14 days vs 21 vs 30 vs 60) is that it
lets you iterate your marketing A/B tests much faster.

~~~
btilly
Which matters more, iterating tests faster, or getting to a better result? In
my books, a better result.

Here we have an actual customer here saying that uselessly short free trials
will drive him to a competitor that offers a useful free trial. And the
customer had an actual example to point to of it happening. If this is a
general trend, then it is impossible for the best optimized short free trial
to match the best optimized longer free trial.

And yes, long conversion cycles are a PITA. However they are sometimes a
necessary PITA. Furthermore a long conversion cycle (if needed) is a useful
barrier to entry for competitors who will need more float to survive, and who
will learn more slowly.

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kefs
I'm surprised to see no mention of the Decoy Effect..

<https://en.wikipedia.org/wiki/Decoy_effect>

~~~
OzzyOsbourne
Finding out about this kind of thing is _exactly_ why I come to Hacker News.
Thank You, eminent kefs.

~~~
nathanbarry
If you like that, watch this TED talk:
[http://www.ted.com/talks/lang/en/dan_ariely_asks_are_we_in_c...](http://www.ted.com/talks/lang/en/dan_ariely_asks_are_we_in_control_of_our_own_decisions.html)

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frankdenbow
Contacting customers with invalid billing information is definitely a good
tip. I was surprised to find out at 17% of our subscribers for StartupThreads
were delinquent. Some had cards stolen, numbers changed, expired, etc. Wish I
had taken their phone numbers to reach out easier, but sending a few friendly
reminder emails will help.

~~~
alanctgardner2
Stripe can do this automatically with WebHooks; it's seriously worth taking
the time to set up.

------
nathanbarry
This list is just a starting point. I would love to hear what all of you have
found works for increasing revenue. Stories are good, specific numbers are
even better!

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elchief
Please do not substantially raise your prices all in one shot.

I watched in horror as the old marketing manager jacked our prices 50% one
day. Everyone complained. He had to drop them back to their original levels.

Do it in baby steps.

~~~
dkokelley
There is a big difference in changing the price for new users and pitching an
increase to your current users. If you are going to price test, do it on
landing page visitors (if possible). Grandfather in your current customers at
current prices if you can (which might even increase retention), or if the
economics prohibit that, explain why the increases are necessary. "We think we
can get more from you" is probably not a good reason from your customer's
point of view.

~~~
nathanbarry
This is a very good point. I should have clarified that I mean to charge more
for new accounts. If you are going to increase prices on existing accounts do
it on a case-by-case basis.

