
Mailgun: new pricing without plans and limits  - old-gregg
http://blog.mailgun.com/post/new-mailgun-pricing-no-more-minimums-features-for-all/
======
the_bear
This is awesome. Aside from the fact that my bill will be cut in half, I hate
plans. Plans are just one more thing to monitor (make sure you don't go over
your totally arbitrary limit!), and they generally lead to weird inequity.

For example, I've been adding ~75 people per day to my MailChimp list and the
price stayed the same. Then one day it went from $75 to $150. Adding thousands
of subscribers was completely free, and then adding one subscriber cost
$75/month. That just doesn't make any sense to me.

Related anecdote: My company doesn't have plans (most in the industry do) and
customers tell me all the time how much they prefer our approach. There may be
selection bias going on, but I have tons of feedback supporting my decision to
avoid plans.

~~~
aymeric
Isn't your company Less Annoying CRM?

I see a monthly plan on your pricing page, did I misunderstand what you meant
by "My company doesn't have plans"?

[https://www.lessannoyingcrm.com/pricing.php](https://www.lessannoyingcrm.com/pricing.php)

~~~
the_bear
Chrischen is right. Maybe I'm not using the term correctly, but I think of
"plans" as meaning multiple different tiers that a user can choose from.
Mailgun previously had plans (i.e. you had to pick which tier you wanted) and
now they don't (i.e. there is just one tier that applies to everyone).

Some characteristics of plans that I don't like:

* Passing some arbitrary limit (# of contacts, # of users, # of files, etc) triggers a steep increase in price, rather than having the price gradually increase as usage increase. For Mailgun, usage is the number of emails sent. For us, it's the number of users on the account.

* Because of the steep price increases at arbitrary points, some users get a lot more value out of the software than others. With Highrise (another CRM) an account with 5,000 contacts pays $24, while an account with 5,001 users pays $49/month. Both accounts are getting roughly the same value, but one is paying twice as much as the other.

* Most SaaS companies with plans force users to choose which plan (or tier) they want when they sign up. How would a user know what features are worth paying for when they haven't even tried the software yet?

* Plans are often used to upsell existing customers after they're locked into your service. Salesforce has a plan that is cheaper than my company's price ($5/user/month vs. $10/user/month) but it is limited to the point of being almost useless. I've talked to many people who got suckered into a 1+ year commitment with them only to realize they'd have to pay $65-$250/user/month to get the functionality they needed.

* Customers have to monitor their usage to make sure they don't trigger the next tier. It's just one extra thing to worry about every day, and businesses have enough on their minds without worrying about unexpected price increases.

Having said all of that, I'm currently struggling with how I might go about
offering more products than just a CRM without making it look like a tiered
system. I don't consider it to be the same thing because they really will be
additional products (project management, invoicing, etc.) which are generally
completely separate subscriptions if you use a different company's products,
but I want them to be integrated/bundled directly with the CRM to make the
user experience as simple as possible. Still not quite sure how to pull this
off. Pricing sure is tricky.

~~~
_k
I took a quick look at it because I will be in the market for a crm system. A
question I have is whether it's possible to add contacts to a campaign so it's
easy to see the results per campaign.

In terms of offering more products without making it look like a tiered
system. If it's invoicing, it's perfectly fine to add that as a feature we can
pay for. Lots of SMBs already have their own invoicing system. They know it's
something separate. Just give it a name, a different color and sell it as a
feature. I think I would like a to-do list as well. Not all contacts buy the
same thing but some do, I want to automate it a little bit, so it's a step by
step approach that I can go through. Give me a list that I can easily copy to
other projects and easily change. Not sure if Basecamp offers something
similar. Add it to the crm system as a feature and charge me for it. Sounds
fair to me.

~~~
the_bear
Thanks for checking us out! There are two different options if you want to
track campaigns. One would be just make a "Group" for each campaign, and then
add the appropriate contacts to the group. Very soon we'll be adding the
ability to filter the pipeline reports by groups, so that should give you what
you're looking for.

Alternatively, you could add a custom field to a pipeline (pipelines = leads
for most people) which would track the campaign. It could be a text field or a
dropdown list depending on how many campaigns you're running.

As for the task management, it's not quite the same, but you can add a
checkbox list to the lead pipeline to track which tasks you've completed. We
also have more task functionality coming at some point, but not in the near
future unfortunately.

Thanks for the feedback on the pricing. Our reservation with charging more for
each feature is that while it's very fair, it seems kind of complicated to
some people if they have to pick and choose every single feature they want to
pay for. Many of our users love how easy it is to understand the price. What
we were considering was offering two products: CRM, and "everything else". So
you decide whether you want all the extra stuff (invoice, project management,
etc.) or if you just want the CRM, and there are just two prices (probably $10
and $25). I like that model, but it seems a lot like having pricing plans
which is why I'm not 100% sold on it yet.

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bratsche
This seems to be closer to how Mandrill works, and it's exactly what got me to
sign up for them only a few days ago. I knew about Mailgun and Sendgrid
before, and started looking into them first but their pricing tiers turned me
off and got me to keep searching until I found Mandrill.

My app is very small, just bootstrapping without any funding so I'm trying to
be very careful how I spend my money. At first I see that Mailgun's minimum
was $19/month while Sendgrid's silver plan is $10/month. Easy, Sendgrid wins.

Oops, I want to support inbound email though. Sendgrid will give you that on
the trial plan, but not on the $10 silver plan. Suddenly I'm up to $80/month
to use Sendgrid. Mailgun wins here.

But before I even noticed that I had already signed up for Sendgrid (believing
I'd be paying $10/month), but had to wait like 5 hours and then I received
some email from them basically demanding that I tell them what my app is, why
I need email, what is the purpose of me sending email. Maybe it's for market
research, but it didn't come across that way. It came across as "we assume
you're a dirty spammer". Of course if I _was_ a spammer I'd just give them so
BS answer, I wouldn't admit it. I can't say call a winner, only a lower:
Sendgrid. Mandrill and SES both treat you like you expect; you sign up, they
cap you at ~250 emails/day for a bit and then you're fine. Sendgrid fail.

Anyway, then my friend points me over to Mandrill and I sign up. The pricing
model fit us well.. up to 12k emails free, then $0.20/thousand after that. In
the state my app is right now I probably won't go over 12k for another few
months, and once I do go over that limit I'm not going to find myself jumping
suddenly to something like $80/month.

If I had been setting this all up just a week later (that is, now) I'd
probably be on Mailgun due to this new pricing model.

~~~
prostoalex
Inbox providers keep track of reputation of an IP address, so most outbound
e-mail service providers guard their IPs, since even a few bad apples can
cause havoc for existing customers. Not saying it's justified, but there's
some verification that needs to happen sooner or later.

~~~
bratsche
Right, but that's the point of SES and Mandrill limiting you to like 250/day
at first and gradually increasing your limit.

Asking you to write an essay telling them what you're using email for is not
verification.

------
dangero
Great job on this. What I really like about this type of pricing is that it
puts the complex cost calculation onto your side instead of the customer. I
use a ton of products, Heroku services being an example where I have to try to
guess at usage. Literally every day I have an internal conversation with
myself that says, "Do you need to go into Heroku and turn down the Database
tier you're on because the service isn't using the capacity that you're paying
for? Wait, but you might get a traffic surge and the site will go down if you
decrease the capacity."

This seems like for me, the ideal case. Automatically scaling down all the way
to $0 so I never have to think about unsubscribing if I stop using it.

I was actually discussing with a friend that it seems like there could be a
big opportunity in the cloud server space to have a zero scale server where
you only pay for time that it is being used. I believe Heroku already does
spin down instances that aren't needed behind the scenes, they just don't give
you the cost savings. They keep it.

~~~
hayksaakian
To be fair, they only spin down people on the free tier, where you can't save
over $0.

~~~
dangero
Is this documented somewhere? Are you sure? How can you tell that you actually
have 3 dynos running when you're paying for 3?

I suspect that if you pay for at least 2 dynos what happens is that they keep
at least one dyno running and scale up to 3 as needed because as a customer I
can't really tell the difference between 1 and 3 dynos unless my traffic
requires all 3 at which point the service would have already scaled up to
three. We already know from the free tier that they can spin up an instance in
a couple of seconds.

I would bet this is Heroku's little secret about making money. If you look at
their cost per month you find that they aren't really making much per instance
on AWS servers although, they are perfectly capable of detecting when they
should auto scale up. Amazon even has a built in service to do that, but
Heroku doesn't expose it because that's where they make their profit margin.

~~~
jordanthoms
Dyno idling is documented, and it only happens to web dynos, when there is
only one running. [https://devcenter.heroku.com/articles/dynos#dyno-
sleeping](https://devcenter.heroku.com/articles/dynos#dyno-sleeping)

I can say from experience they definitely do not scale down the dynos you are
paying for - you still see log entries from them and they are immediately
available to requests.

~~~
dangero
Oh interesting. I was wrong.

------
twakefield
Our most popular feedback to date is to eliminate minimums and get rid of
feature gating in plans. So, here you go.

As always, open to feedback.

~~~
gog
Before if you had a 59 US $ plan (dedicated IP), the cost was 0.59/thousand,
so you could send 118k emails.

With the new plan, for 59 US$ you get the dedicated IP and 10k emails. Sending
118k emails with a dedicated IP would cost 113 US$

~~~
twakefield
For some customers it may make sense to stay on their current pricing, which
we allow for.

------
flyingyeti
While reading the new pricing structure, I realized that the Mailboxes feature
[1] (allowing programmatic creation of mailboxes via the API) is deprecated.
That's too bad; it was the reason I started using Mailgun in the first place.
Is anyone aware of an alternate service that offers this feature, short of
managing my own mail server?

1: [http://documentation.mailgun.com/quickstart.html#using-
mailb...](http://documentation.mailgun.com/quickstart.html#using-mailboxes)

------
DenisM
The old pricing was fine with me. Now I worry you will go out of business or
get swamped with support requests from people who haven't paid anything. But
whatever works for you, I guess.

~~~
ktsmith
Mailgun was purchased by rackspace. I don't see them going out of business any
time soon.

~~~
lubos
I was also more than happy to pay $19/month. Now my monthly bill goes to $0?
I'm a bit worried what will happen to quality of service and support now.

And the fact Rackspace has purchased Mailgun doesn't mean a thing. Just look
what Rackspace did to JungleDisk... I used to be also happy customer of
JungleDisk so no wonder I'm a bit bitter regarding Rackspace.

~~~
ktsmith
You can continue to stay on the $19/mo plan. There's an option to stay on your
existing plan or move to the new pricing.

I'm not familiar with what rackspace did to jungle disk as I've never used it.
I was under the impression the service was still running with a rebrand.

------
twodayslate
I always thought there was a price point to weed out spammers. I hope this
doesn't effect the service.

------
thejosh
Been using mailgun for a while to send nagios alerts from our server using
SMTP to various accounts that need to be notified. Instead of sending it to 3
accounts, you send it to one then mailgun sends it off to the accounts you
want added.

It is perfect and worth the $19. Now I'm unsure if I should just downgrade...
but it's not really worth it for the value I get out of Mailgun.

------
everettForth
I started looking at [http://yclist.com/](http://yclist.com/) and realized
that many companies I often see listed on the front page here are actually YC
companies, but not marked as such.

~~~
philip1209
Mailgun is now owned by Rackspace, so I don't think it's still considered an
active member of the YC family.

~~~
everettForth
Ok, how do you explain stripe and priceonomics? I'm sure I'm missing others.

~~~
true_religion
Why do they need to mark themselves as YC companies if they don't want the
boost associated with being YC?

------
AznHisoka
When SES is 5 time as less (although less features, I know), there's really no
reason why I would go with Mailgun. 10 cents for every 1000 emails is very
very hard to beat. And when I'm just relying on you to email, I don't need
things such as UI, analytics, etc as much.

I typed in 300000 in the pricing calculator, and got $150.00/month as my
price. For any startup, that is just too much. With SES, it's $30.00/month. I
know that there's a premium to be paid for certain features, and I know the
pricing is better than what it was originally, but SES to me is still
superior.

~~~
riobard
You don't get dedicated IP and custom DKIM with SES. Those affect
deliverability significantly.

------
alberth
I don't under the pricing table.

It shows:

Emails Price / 1,000 Total Price

0 - 10,000 Free

Next 500,000 $0.50

Next 1,000,000 $0.35

Next 5,000,000 $0.15

Any Additional $0.10

Does that mean emails 10,001-510,000 cost $0.50 per thousand and then emails
510,000-1,510,000 cost $0.35 per thousand?

~~~
jmharvey
Yes, that seems to be what it means. In general, heavy users get better
marginal prices, but there's a "free sample" amount for very light users.

------
dsr_
Dear Mailgun --

How can I programmatically identify the accounts that are on their first email
blast? Please include a header. I suggest it look like this:

X-Mailgun-FNG: 1

with the value set to the number of days on which this customer has used your
service to send more than 100 messages.

Then I can filter out all the spammers who are signing up for your service
with stolen credit cards, sending until you stop them, and then doing it all
over again with a new account.

What, you didn't think of that?

------
6ren
Weirdly, the pricing calculator doesn't appear on the linked page - but it
does on the pricing page. (using FF 20, ubuntu)

I think some people might like plan limits, to cap their costs (so they don't
accidentally run up a huge bill). It might be nice to have a separate option
to also impose a limit. Though this is an extra complication and I'm not sure
how many customers would actually want this, if any.

------
adlpz
Aside from the cringeworthy meme thing, the pricing seems really, really nice
:D.

------
cdjk
This is awesome! I've been meaning to use mailgun for some small personal
projects, but didn't want to pay to use my own domain. That's the biggest
advantage of the change for me.

------
wijnglas
These price changes make Mailgun much more expensive than Mandrill (especially
for dedicated IPs). Mandrill also has inbound now, so I don't see the point of
choosing Mailgun over Mandrill.

~~~
veesahni
Also note that mandrill inbound is complimentary to customers right now ..

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dangayle
This is RAD. I love mailgun's service, and now I have even more reason to
never use the built-in mail server on my *nix boxes for processing or sending
mail.

------
mehulkar
I had just switched to Mandrill after being unhappy with Mailgun for unrelated
reasons. I'm tempted to switch back to Mailgun after this.

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pbreit
If you're gonna promote your big pricing change, why not get closer, or,
ideally, undercut your competitors (Sendgrid, Mandrill)?

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ebin
Why use a service like this in the first place when you can simply send out
mail via a VPS?

~~~
manojlds
Many email services block spammers / unknown senders, especially if you start
sending hundreds of mails.

~~~
_k
Do you happen to know how that works ? I never used a service like mailgun or
mailchimp. Do they use IP addresses that are not being blocked by the email
services ?

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etaty
The input box doesn't work with a French keyboard, nor copy/paste.

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gcforky
Just changed my Plan... Now i am saving $66 per month.

------
lucisferre
Is it just me or is it odd that after the free tier sending an e-mail is
almost as much as letter postage?

~~~
mgkimsal
huh?

$.50 per 1000 is... nowhere near letter postage.

