|HN readers running online SaaS might be interested in this cautionary tale of marketing failure.|
Omnisend is a email marketing platform. When I signed up for their free tier a few months ago, it was because they were giving me the freedom to grow my business with them. The free tier had unlimited contacts/15000 mails per month. I didn't expect to reach that limit soon and I appreciated being able to start out free and switch to paid if and when the business took off.
Yesterday, I received a mail that said Omnisend is now changing pricing. I opened the mail with a feeling of dread and found that the free tier is now 250 contacts and 500 emails/month. I don't mind the contacts limit but the mail limit is crippling.
My limits in the new plan, assuming everything goes perfectly (which it never does) = 1 campaign + 80 transactions.
One transaction generally means 3 messages (order placed, order dispatched, order delivered).
One email campaign per month = 250 messages.
For comparison, Mailchimp's free tier has unlimited contacts and 3000 messages per month. They limit mails to 12/contact/month.
These limits might work for a monthly church newsletter where you occasionally want to post an addendum/correction. Not for me and I think likely not for most small business.
The communication around the pricing update is complete crap. The headline says "We are moving to contact-based pricing". I have no idea how much they are going to charge per contact. Read their update here (https://support.omnisend.com/en/articles/5499152-omnisend-pricing) and tell me if you can figure it out. How likely am I to sign up for something if i can't figure out the cost of it up front?
I get that free tiers cost the provider money and they are prone to abuse. But surely the marketing value of a free tier has to be weighed against the cost. This change feels like a cautionary business tale to me in every way, and that's why I'm sharing it on HN.
1. Dropping free tier to unusable limits
2. Opaque pricing in new plans
3. No clear dates (The Trial plan will be sunset once the new pricing is released this autumn.) I thought it's already autumn now?
If I had been in charge, I'd have put a contact limit on the free tier, capped it at 12 mails per month per contact and be done with it. That would have been understandable. This is incomprehensible.
I'll be dropping them. A pity, because their support has been excellent, even for the trial. I expect a lot of others will do the same. Your thoughts appreciated.