

Are you entitled to Grandfathered pricing? - jusben1369
http://jmlite.tumblr.com/

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Lazare
The link goes to the blogs front page; the article link is actually:
[http://jmlite.tumblr.com/post/26301352781/are-you-
entitled-t...](http://jmlite.tumblr.com/post/26301352781/are-you-entitled-to-
grandfathered-pricing)

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Vitaly
The problem with rising prices is that some of the customers might have
evaluated feasibility of your service based on price, and now that you rise it
they might have to move elsewhere, with a substantial re-integration cost.

I think it is totally OK for grandfathered accounts to lack the newest and
greatest features as a means to encourage upgrade but holding on support is
definitely not OK.

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jusben1369
I think that's a fair argument Vitaly. Two thoughts. One, if the service has
gotten better has their been real cost savings or revenue improvements from
using it? Two, if the answer is no, then maybe you will have to change. I like
giving someone 30 - 100 days (depends on how hard it is to make a change) so
at least the only cost then is the one on your side.

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Dylan16807
About lowering prices: Generally a customer can make or cancel a subscription
on a moment's notice and still be seen as a good corporate citizen. A business
doing so to its customers is not being a good citizen. And taking advantage of
a price drop is very similar to a cancel+resubscribe.

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billpatrianakos
I like to always make the point that users are spoiled and have an awful sense
of entitlement when it comes to the web but in this case I can't say I blame
the users. It's really important to think long term and definitely overprice
your product rather than pricing it as low as you can. If the price point you
set can't be sustained in 2 to 5 years with the number of users you project
(and this is where you should overprotect or, put another way, plan for the
best case scenario) then be ready for some backlash and lost customers. Always
try to make it so you have to lower prices as username grows. It's common
sense. Now of course you can't always do that and you have to feel for the
company when that happens but the customers will get over it. So long as you
handle it well and you're offering something people want the users will pay
the higher price as long as they're still getting value from the product.

Customers bitch about every little change you'll ever make so sometimes you
just have to take it with a grain of salt. Hell, even free services get this
when any change is made because people already using the product don't want
any change. At all. Humans hate Amy and all change. So if you think enough
current users will eventually get on board and new users will surely get more
value from a change then it's worth it.

He frames this in terms of grandfathered pricing but really it's about users
reacting to change. Higher pricing is the worst kind of change a user can
experience but in the end it's almost no different than when Facebook changes
privacy settings (or changes your email address without asking). The success
or failure will be based on new users valuing the change thus getting them to
sign up and current users eventually getting used to it versus the exact
opposite of that. Users will bitch about all changes always. Upping the price,
unfortunately, is the worst thing you could probably do. But they'll get over
it.

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chii
Its very interesting.

I recently read an article about a game (i think it was realm of the mad
gods), where the developers of the game initially priced some items cheaper,
but got more expensive as you purchased more (i recall it was chests that
allow you to store extra items). Buying 1 is say, $1, and 2 is $2, but buying
4 is $5 (this is to encourage casuals to buy 1, but extract more out of the
hardcore players).

This lead to quite a backlash - so they changed the wording, such that buying
the 1st one is still $1, but it was made clear that it was discounted X% from
the 'real' price. This simple change, stopped almost all backlash.

So it is basically a psycological phenomenon. Its a similar thing to what this
TED video had to say about how people estimate and make decisions
[http://www.ted.com/talks/dan_gilbert_researches_happiness.ht...](http://www.ted.com/talks/dan_gilbert_researches_happiness.html)

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jusben1369
Well burying pricing and then doing a "gotcha" is pretty offensive. If that's
what happened then the lack of transparency was probably the key point people
objected to.

