The Dangers of Pricing in WordPress Business Models

One of the business models that is common (although not as common as it used to be) in the economy of WordPress is the unlimited support for for a single purchase. That is, you buy a theme or a plugin, and you pay for the product and the purchase often includes a license for lifetime support.

For those of you who have made a similar purchase, then you’ve likely seen some type of pricing defined like this:

  • $X for the purchase of the product
  • Use the product on Y number of domains
  • Unlimited support and updates

And then the above scheme is tiered such that X and Y change based on the amount of money paid toward the product.

But, like I said, this is nothing new and it’s something that we see frequently see, but anyone who has worked with this particular business or who followed this through to its inevitable conclusion realizes that this is a completely unsustainable business model.

To that end, if more small businesses based on WordPress want to have a better shot of “making it” (where “making it” is defined as staying in business – not some arbitrary amount of money to be made), then this particular pricing model needs to die.

Unsustainable WordPress Business Models

Simply put, the transactional pricing model – that is, one time purchases – for pricing WordPress products does not scale.

Practically speaking, let’s say that you have a one or two man shop building a premium plugin. The plugin follows the model outlined in the introduction of this post. As the plugin’s customer base grows, the demand for support is placed on the suppliers of the product.

As more and more people purchase the product, the amount of support that the product demands exceeds the amount of work that the two person team can do, so they hire someone else to help with support. Naturally, this helps for a bit, but then the demand continues to increase and the team is back where they were when they started.

But although the amount of money that the business is making increases over a short time, there’s not a solid amount of cash flow. That means that eventually, you’re working towards a point where the amount of money coming in is not going to match the amount of money needed to pay the original team and those who offer support.

At this point, there are N-number of people continually asking for support, expecting updates, and so on, but there’s no money coming in to support that amount of work. That is, the customers have paid a one time fee of $50 for an unlimited amount of service.

That’s part of where the problem lies: When you offer unlimited support, you’re not just offering support. You’re also offering continual updates (because WordPress is under constant development), support for a variety of web hosts (because customers are not one-size-fits all), and you’re placing more demand on the staff of the product rather than on the customer base.

That is, we need to turn the pricing around such that customers have the choice of something like this:

  • One time purchase along with one unit of support (where a unit may be a month, may be six months, maybe a year)
  • The option to renew their license for support when the initial period of time has passed.

This creates cash flow for the business which makes it more sustainable, and helps to fragment the customer base between those who need support (and will be paying for it), and those who just need the product.

Additionally, it provides a gateway to paid upgrades which helps to fund the continued development of the product, and does so purely based on how many people are willing to renew their license to pay for the product.

“But Wait, There’s More!”

Talking business models, pricing, and so on in the context of any business – let alone WordPress – is a large topic that can’t be easily summarized in a single post.

This is why there are sessions at WordCamps devoted to this topic. This is why leaders of larger WordPress companies have blogs and/or are featured on podcasts and roundtables to talk specifically about the WordPress economy.

This post is not intended to be an authoritative, all-encompassing write up on product development and managing a business of WordPress products. It is, however, meant to be a high-level survey of problems I’ve seen and experienced, and a case for why I think a model that current exist needs to go away.

But I know that there are people who are far smarter than I am and who are far more educated than I am as it relates to pricing products, dealing with both supply and demand, and creating pricing strategies for products and those people are worth your time, but perhaps all of the above provides enough food for thought for how to price your next product or the next version of your product.

51 Replies to “The Dangers of Pricing in WordPress Business Models”

  1. I’ve always felt like there were levels to the product pricing game. That’s all perception, though, because I’ve never been on a higher level than where I am now… which is one transaction/lifetime everything. I guess I figured you have get your exposure up before you can establish the kind of model we’re talking about here. I’m starting to believe otherwise, though. Check this thread out in .org’s support forums. http://wordpress.org/support/topic/theme-designers-need-to-charge-more-so-they-cant-deliver-more?replies=6

    1. I guess I figured you have get your exposure up before you can establish the kind of model we’re talking about here.

      As a word of caution (from experience): don’t let this particular thinking get in the way of launching with a stronger business model.

      If you stay on the track that you’re on with single-payment-plus-lifetime support, and then you try to change the plan after you have an established customer base, you’re going to make a lot of people angry.

      Significantly larger WordPress companies have done this and they, if not else, provide examples as to exactly why the model discussed above needs to go away.

      1. What happens if your customers don’t need support (or they prefer to buy it when needed), but just need updates? Why charge a high renewal rate then, or don’t charge. Boy, at the rate WordPress is growing and everything is moving towards renewals after Chris Lema’s article and Woothemes’ decision, it’s very lucrative to program plugins, no?

        1. What happens if your customers don’t need support (or they prefer to buy it when needed), but just need updates?

          If there’s a situation in which customers don’t need support, then there’s a case for offering the product for free (hence the GPL). If they want updates, then the updates could be offered for free, or they could be offered at a service of N-number of update per year.

          Either of those are options.

          Boy, at the rate WordPress is growing and everything is moving towards renewals after Chris Lema’s article and Woothemes’ decision, it’s very lucrative to program plugins, no?

          I’m not certain of Chris’ article, but Woo’s decision was certainly not the first, and this is a point that needs to be made in an economy that’s obviously growing. I’d go as far as to say that many people didn’t get it right the first time, and now we’re suffering growing pains for that.

      2. I’m totally over it. This article was the last nudge I needed. I have two site where I sell WP themes and other stuff. In the last few days I’ve changed the pricing structure of both and made better use of the licensing system I have built in. I saw what happened to Woo and though I would never change terms for old customers, I don’t want any of that funk in my life at all. So the switch is made. Thanks for writing this!

  2. 3 Cheers for this!

    Shops need to have their value proposition ready to position themselves apart from the low end flash sales. It’s not easy and like everything else, it’s going to take some time, but they should be ready to be better at marketing and story telling.

    1. It’s not easy and like everything else, it’s going to take some time, but they should be ready to be better at marketing and story telling.

      Yes, and this is something that I think all developers – myself included – need to get better at doing. Luckily, we’ve got a few more business-minded people around to help us with that ;).

  3. From the developer’s perspective your argument makes sense but from the user’s perspective, it can be a management nightmare dealing with all the plugin developers not to mention the accumulative subscription costs. If the user of the plugin has 10 other plugins and each one has a significant subscription fee, the cost of maintaining a WordPress site with all the subscriptions tends to negate the whole idea of using an open source solution.

    1. Managing renewal costs for plugins that are assets of a business and tools that the success of the business is built upon should be considered no different than standard utility costs. In order to run a brick and mortar store, you have to pay the electric company to keep the lights on. To run an internet-based business, you have to pay the hosting company to keep your site running. To run an e-commerce store, you have to pay the company that develops the e-commerce system to continually maintain it.

      No business would ever think twice about the need to pay the electric and other utility companies, and no one would ever propose to them that they provide a lifetime purchase option. It simply doesn’t make sense and is very, very easy to understand why it doesn’t make sense.

      Plugins and other software that are the foundation for a business’s website should not be thought of or considered any different.

    2. If the user of the plugin has 10 other plugins and each one has a significant subscription fee, the cost of maintaining a WordPress site with all the subscriptions tends to negate the whole idea of using an open source solution.

      I absolutely see what you’re saying, but I don’t necessarily agree.

      Here’s why: Open source software – and in our case, that’d be WordPress – does allow for the free distribution of software. There’s no problem there; however, users are paying for support.

      To that end, if they want the code but want no support, then I think there’s a viable business model for sharing the work, but as soon as a question is asked or a problem occurs, then you get into the arena of support and a transaction for the time spent between the exchange of service should be made. Now, whether or not this is done per ticket, per month, per year – that’s the service provider’s decision.

      Next, I don’t think that if a user has 10 plugins each of which they are paying to have supported is a problem namely because there are plenty of things “offline” that we pay for either for a subscription service (internet access, cable television, cell phone, insurance, etc.) and we have no problem with that, so I personally don’t see the problem with having software be treated the same.

      To be clear, I know that you’re saying that it negates the purpose of open source software but the difference lies in using open source software and in having support for the open source software.

      Open source software can be free. In fact, I don’t really know of any WordPress-based products that provide the product for pay with absolutely no support. Every example that I can think of (which I may be missing some – I’m fine admitting that), involves support and multisite licenses.

      So the customer is actually paying for service – not for the product.

      1. But then, if it’ll cost so much to maintain a site with a bunch of premium plugins, which are more like rental than a purchase (because they expire after 12 months), then why not
        1) Program ourselves?
        2) Use a cheaper and easier to maintain solution like Shopify, Wix, Squarespace, Weebly and others?

        1. 1) Program ourselves?

          You can! That’s what’s awesome about open source software :). But not everyone can do that.

          2) Use a cheaper and easier to maintain solution like Shopify, Wix, Squarespace, Weebly and others?

          You can! That’s what’s awesome about having choice in the market, but a number of those services are not self-hosted so the data is kept elsewhere. For some, that’s completely okay; for others, where they store their data and how they manage it matters.

  4. This post should serve as an astute warning for those thinking of getting into the WP theme/plugin biz. Pricing products correctly is tricky for anyone, and when you introduce service as a value-added part of your business, you’re compounding the trickiness. And nearly every theme/plugin dev offers support as an incentive to their product to compete in a market where “free” is very common, and it all screws up everyone’s margins, to be blunt.

    There are hundreds of financial considerations that can be considered when pricing a product. What everyone else is charging shouldn’t be one. The cost to secure a customer, keep a customer, and the lifetime value of a customer are a few of the more important ones, but I’d really be surprised if, as Pippen points out, many future entrepreneurs bother to calculate even their fixed and variable costs, which should be calculated when determining if you even have a viable idea and before the first keystroke is hit.

    Really, in the larger WP theme and plugin market(the WP “economy”), ALL you’re selling is support, and obviously that’s the case in freemium scenarios. The margins you make from an already-developed product max out pretty quickly(and in some cases die just as quickly), and although a customer may upgrade their product in one way or another, the sale is usually a one-time event. Many devs price their products without figuring out what will their actual costs be in time and resources for the life of that product. Again, tough call when a lot of people are out there competing in the market with a “try it and see” approach.

    I’m really enjoying all the recent business-related posts. I wish I had more time to engage.

    1. Pricing products correctly is tricky for anyone, and when you introduce service as a value-added part of your business, you’re compounding the trickiness

      I agree – developer-types are not marketers or often aren’t great at pricing until they get a little further into their career. I’m speaking out of personal experience here, as well.

      To that end, I’ve sought out advice from other people who are better business people than I am to help me come up with strategies for certain things in order to provide food for thought.

      At any rate, I see a lot of what’s happening in the WordPress economy the same as what we see in the Apple App Store economy which is that people come out launching products at low prices to be “competitive” but ultimately damaging the entire business like it’s a gold rush of some sort.

      So when I see plugins like Gravity Forms or things from X Team or other products coming out with pricing like $297, I actually don’t think that’s unreasonable as a commercial cost. Personal cost? Sure, it should be lower, but not $4.99 low.

      At any rate, the only way I see this changing is that enough of the larger playing charge proper pricing for the proper markets for this stuff and then sticking to it. Eventually, the higher quality products will surface to the top and the lesser quality products will remain inexpensive and at the bottom.

      There are plenty of real world comparisons to be made here, but I hesitate to do so for the sake of accidentally tripping of a wire of a political/economic argument and that’s something that I don’t want to bother doing.

  5. Thumbs up from here, Tom! Nice article laying out the principles of this.

    Once-off pricing models for magical, never-ending support is simply unsustainable. Unfortunately, the WordPress community is accustomed to this model and simply don’t really like the idea of recurring payments. It’ll be a tough tide to turn.

    Fully legitimate businesses though ‘get it’, but it’s a tougher pill to swallow for the smaller shops/individuals.

    Cheers!
    Paul.

    1. Unfortunately, the WordPress community is accustomed to this model and simply don’t really like the idea of recurring payments. It’ll be a tough tide to turn.

      It’d definitely a tough tide to turn, but it’s not impossible. It’ll just take a significant majority for it to happen and that’s certainly no easy task.

      But crazier things have happened, right? :)

      Fully legitimate businesses though ‘get it’, but it’s a tougher pill to swallow for the smaller shops/individuals.

      You’ve piqued my curiosity though, on why it’s harder for smaller shops and individuals to do this? The reason I ask isn’t some antagonist approach – just an honest question primarily because I’m a smaller shop, but I’m not looking at eventually launching things on the cheap end for unlimited support :).

  6. Plugins and themes are services as long as you use the product you need pay for the service it provides.

    The problem started when so many people started to develop a products just to make a quick money the didn’t even thought about the support they need to provide.

    This has lowered the products quality and created a situation when real developer started to align to the same pricing tactics.

    Another thing that we are against is “unlimited licenses”. There is a big difference between support for 10 websites and support for 30 websites. It’s very good as a marketing point to sell “unlimited” but it’s no right from a business perspective.

    1. I agree. Promising support for unlimited sites is as unrealistic as promising support for an unlimited period of time. Why do theme sellers do this? I have my theories (copying bigger theme shops, misunderstanding the GPL) but I’m not totally sure.

      Each purchase from us includes one theme with support and one-click updates for that theme on one site, for a period of one year (renewable at 50%). If a professional is building a site for a client, they simply pass on the cost. The client can pickup renewal of the license if the professional moves on.

    2. Plugins and themes are services as long as you use the product you need pay for the service it provides.

      I’m probably splitting hairs, so forgive me if that’s the case, but the plugins and themes themselves are products – it’s the support that’s the service. But I think you’ve basically covered that in the second half of what you’ve said.

      I just tend to see these things as a pairing between a product and a service, you know?

      Another thing that we are against is “unlimited licenses”. There is a big difference between support for 10 websites and support for 30 websites. It’s very good as a marketing point to sell “unlimited” but it’s no right from a business perspective.

      Amen. Couldn’t have said it better myself.

    3. The problem started when so many people started to develop a products just to make a quick money the didn’t even thought about the support they need to provide.

      Yeah, and this seems to be a condition of the human race rather than an actual part of the economy, you know?

      Look how far back “get rich quick” schemes go :).

      This has lowered the products quality and created a situation when real developer started to align to the same pricing tactics.

      Ugh. I know. You’re right. This is a hard thing to fight too because you’e going against the tide, but we see much of the same thing happening in other places like the App Store, no?

      Another thing that we are against is “unlimited licenses”. There is a big difference between support for 10 websites and support for 30 websites. It’s very good as a marketing point to sell “unlimited” but it’s no right from a business perspective.

      Couldn’t agree more.

  7. Why not charge for support tickets package? Like $50 = 5 tickets (1 ticket for each issue, of course…). This way developers would be able to charge less for the product itself.

    And by the way, I think there is a contradiction on developer’s behave. I mean, they claim to be drawn on support tickets, but keep the support forum private. Set a reasonable price on the product, charge an extra for support, but let everybody see the tickets and the correspondent solutions. Some plugin/theme sellers don’t even have a consistent FAQ on their websites…

    1. Why not charge for support tickets package? Like $50 = 5 tickets (1 ticket for each issue, of course…). This way developers would be able to charge less for the product itself.

      In theory, I think it’s a great idea, but I’m afraid that frequent recurring charges does something to the psychology of customers. This is just a theory, of course, but I think about the times that we used to pay for, say, internet by the hour and it was like these nickle-and-dime charges for time spent online.

      Paying for support for a well-defined, relatively liberal amount of time (though priced correctly) seems to ease that.

      Again, just an opinion.

      And by the way, I think there is a contradiction on developer’s behave. I mean, they claim to be drawn on support tickets, but keep the support forum private. Set a reasonable price on the product, charge an extra for support, but let everybody see the tickets and the correspondent solutions. Some plugin/theme sellers don’t even have a consistent FAQ on their websites…

      Amen to this, man.

      1. But not everyone needs support. It’s true. Most of our issues with WooCommerce’s extensions happens when they don’t work, even after we disable all other plugins. Then the developer comes up with a fix.

        And even so, not all are fixed, yet. So what happens if your customer reports a bug in your plugin, do you charge? Or does he gets 12 months free for notifying you? We need to be fair.

        1. But not everyone needs support. It’s true

          Agreed.

          Most of our issues with WooCommerce’s extensions happens when they don’t work, even after we disable all other plugins. Then the developer comes up with a fix.

          That’s an issue with a single business, so I can’t speak to that, really. But generalizing an experience with a single business to every business doesn’t work. Like you said “we need to be fair.”

          So what happens if your customer reports a bug in your plugin, do you charge? Or does he gets 12 months free for notifying you? We need to be fair.

          If you’re asking me personally, then I would say if a customer reports a bug and I fix it, I’m happy to give him/her a copy of the product with the single fix in place – or go above and beyond.

          I’d never charge people to report bugs.

          Or does he gets 12 months free for notifying you? We need to be fair.

          I don’t know if a single bug report warrants 12 months of support or not. There are other options (such as I mentioned above), but how each business opts to serve their customers is their business — of course I argue in favor of sustainability, but people are free to do as they please :).

  8. I sure would like to know what a “fully legitimate business” might be. Maybe those are the ones in certain parts of Nevada.

    For those of us that use WordPress for our many clients certainly do not expect to provide those services for free, we don’t expect plugin developers to provide their services for free so we pass on the expense of the various plugins to the client. Plugin developers should get paid for their efforts PROVIDED they create a quality product that plays nice with other plugins. I don’t think they should be paid for updates that fix problems they created or to fix problems when a new version is released. I do think they should be paid for Pro versions that contain extra features and capabilities. I also think they should be paid for any individual support but not for support to fix bugs that the user finds.

    Woo created a major problem for themselves when they started out with an unlimited policy and then tried to change it for customers who had purchased several of their plugins. Fortunately they listened to their customers (somewhat unusual in this industry) and grandfathered their original purchasers. They did the right thing and now they are busting with orders and can’t hire programmers fast enough.

    So if you have a great product that helps customers do their job better and faster then you should charge for it, or better yet, charge for an upgraded pro version. Event Espresso has been very successful with that strategy. But make sure what you charge is inline with the value the plugin provides. Some plugin developers must have delusions of grandeur because their annual subscription for upgrades, which are mostly fixes, are out line with the value provided. I also think that separating support and upgrades might be helpful. In most cases we have found that WordPress plugin support is not that good. Our clients are not very tolerant when one of the plugins on their site malfunctions and so we usually have to solve the problem long before support responds.

    1. I sure would like to know what a “fully legitimate business” might be. Maybe those are the ones in certain parts of Nevada.

      I’m guessing you’re talking about Paul’s comment though I’m missing the Nevada connection :).

      Either way, I don’t think he meant it as a sleight against anyone or any business in particular. Just my two cents.

      Anyway…

      Woo created a major problem for themselves when they started out with an unlimited policy and then tried to change it for customers who had purchased several of their plugins. Fortunately they listened to their customers (somewhat unusual in this industry) and grandfathered their original purchasers. They did the right thing and now they are busting with orders and can’t hire programmers fast enough.

      Yes. Exactly! This scenario comes to mind. I don’t know if it’s the poster child for this, but it certainly ranks as one of the top cautionary tales, in my opinion.

      So if you have a great product that helps customers do their job better and faster then you should charge for it, or better yet, charge for an upgraded pro version.

      Totally. I love looking at how other software companies operating in different economies to see what models and strategies they employ. Some of them transcend the platform for which they’re built; others, not so much.

      But that’s okay — it gives us plenty of food for thought and ways to innovate within our own space.

  9. Great post, Tom.

    Pricing is a super interesting area for WordPress. As a buyer, I’ve rarely asked for actual support. If I fill out a ticket, it often ends up in a feature change or bug fix in the product. And all in all, my only motivation for buying support licenses is for updates.

    That’s why, in my opinion, I wish there were more options that separate support from updates. They are always bundled, and I get that. But as noted by many companies, people often just don’t renew. Then, when updates don’t happen and the plugin eventually causes site issues, it can still hurt the reputation of the plugin author.

    I’d happily pay a decent chunk of change for lifetime or extended (beyond a year) updates, even without any guarantee of support. However, few have created such a model. Though, iThemes just did (the subject of our latest Post Status post, by Travis Northcutt). I’m really excited to see how it works for them, and I’m also looking forward to seeing whether or not others will follow their footsteps.

    1. Yep, supports and updates should be separated. We don’t mind paying let’s say, 20% renewal or a higher one time fee for renewals, and something like $5 or 10 for support. But a coupon of $2 or 4 for bugs reported :) What do you think?

      1. Yep, supports and updates should be separated.

        I think there’s something to this — we just haven’t seen done much yet.

        We don’t mind paying let’s say, 20% renewal or a higher one time fee for renewals, and something like $5 or 10 for support.

        The $5 – $10 for support seems extremely cheap and this is coming from experience from someone who has developed and run Tier 3 support for a premium WordPress theme. Support includes a lot (not to imply that you don’t get that, of course!) but $10 per, say, ticket per person feels more like nickel and diming someone (even though it’s not) just to ask a question.

        That is, I’m just thinking of this from the user’s standpoint, you know?

        But a coupon of $2 or 4 for bugs reported :)

        Now this is something that’s a fair contrast to what you’ve mentioned above in terms of when someone reports a bug. I think that there’s a viable opportunity in something like that.

    2. As a buyer, I’ve rarely asked for actual support.

      Same! And though the source code could be / should be (I’m not here to argue licensing :) given for free, I’m still happy to pay developers and designers for their time working on the product.

      And all in all, my only motivation for buying support licenses is for updates.

      Agreed, again. I think it raises point that support and updates should be separate things, but that’s not something that we’re seeing often in the WordPress economy. At least not yet. And this isn’t to say that some people aren’t doing it, but just that it’s not the norm.

      Then, when updates don’t happen and the plugin eventually causes site issues, it can still hurt the reputation of the plugin author.

      I’d even follow this to a more extreme conclusion such that the plugin/theme/product could eventually die – after all, if something isn’t weathering whatever conditions are surrounding it, then it’s not going to fair well against it’s competition.

      Though, iThemes just did (the subject of our latest Post Status post, by Travis Northcutt). I’m really excited to see how it works for them, and I’m also looking forward to seeing whether or not others will follow their footsteps.

      Agreed on all accounts. Sometimes I think it either takes a brand new kid on the block (no 90’s music reference please :) or a huge market leader to inspire others to follow in their footsteps.

  10. Great post, Tom, and thanks for the X-Team mention in one of your comments.

    Pricing is so important for the continuation of your business and being able to provide what you’ve promised to your customers.

    We decided to go with the “Theme Club”-style model for Stream.

    Stream itself is free, and for Stream Premium you pay for a year of updates and support, as well as access to extensions. You can choose whether renewal is automatic at the time of sign up. If you choose not to renew, you still have the extensions that you downloaded, you just won’t get access to new ones and obviously no more support or updates.

    The thing businesses sometimes forget is that while paying might get them access to a product, in the Open Source Software world, they’re payment is generally for a service. In an earlier comment, Pippin likened these ongoing payments to utilities, or like internet connection fees.

    No analogy is perfect, but I’d also like to suggest the analogy of maintenance services, like for yard work or something. You pay a subscription to the service, and they keep everything up-to-date for you and you can ask them for advice or assistance etc. for anything covered under that service.

    You can stop the subscription at any time, and your garden won’t go away, but weeds will start to grow and you’ll realise there’s definite value in those ongoing fees.

    I don’t know how well that analogy holds together, but I like it on the surface anyway :)

    Great discussion, Tom, thanks!

    1. Stream itself is free, and for Stream Premium you pay for a year of updates and support, as well as access to extensions. You can choose whether renewal is automatic at the time of sign up. If you choose not to renew, you still have the extensions that you downloaded, you just won’t get access to new ones and obviously no more support or updates.

      Love it — and extensions are another area in which some people don’t often consider pricing as the idea of “extensions for a plugins” or “plugins for a plugin” feels weird, but when you look at other products like EDD, you see it’s totally possible.

      The thing businesses sometimes forget is that while paying might get them access to a product, in the Open Source Software world, they’re payment is generally for a service.

      Bingo.

      You can stop the subscription at any time, and your garden won’t go away, but weeds will start to grow and you’ll realise there’s definite value in those ongoing fees.

      For sure. Unless you’re capable and willing to do the work yourself (which is every single person’s prerogative), then that’s completely fine!

  11. More than a year ago when I launched my theme shop (not gonna drop links), I decided to do the unthinkable – charge $199 per theme, with 1 year of updates/support.
    I’m pretty happy with that decision :)

    The talks that I have with the customers, the stuff that I found out from the surveys… oh boy, oh boy!

    1. I’d love to hear more about your experience.

      First off, I love the idea of your price-per-theme-per-year, but I’m even more interested in the findings from your surveys.

      Is that confidential info? :)

      1. I guess the main thing to say is this: people don’t really ask for discounts or “special offers”. I hear this question maybe once out of 30 people.

        What I’m saying is this: if somebody would pay 60$ for a theme, they will most likely pay $150 as well, as long as it solves their problem.

        When I see new shops launching with $20-$40 prices, it is just painful to watch.

        1. What I’m saying is this: if somebody would pay 60$ for a theme, they will most likely pay $150 as well, as long as it solves their problem.

          I love this. I think there are lines customers aren’t willing to cross, but it raises the question of if you want that type of person as your customer anyway.

          When I see new shops launching with $20-$40 prices, it is just painful to watch.

          This is the norm right now, of course, and I think a lot of it is driven by market competition and my things we see in other places such as the App Store or Google Play or something like that.

          But that’s a whole other issue.

          1. It is better to sell 10 copies for $200 than 50 copies for $50.

            You avoid impulse shoppers, who buy something without much thinking…
            The customers are more mature, they have real plans for the theme, not just “I thought it would look nice”.

            1. Higher pricing is interesting to me because less customers means less support which means more development time — more and/or better products. On a larger scale it would mean paying less support staff (more profit). On the other hand, less customers means less social proof.

              I would assume somebody paying $200 expects more than somebody paying less than half as much but on that WP Candy article from a while back you suggested lower paying customers are more needy. Is that your conclusion after one year of $200 themes?

              That would be really useful information for somebody considering higher pricing.

                1. Yes, I can still say that my customers are less needy than the ones buying $20 themes.

                  Or maybe they understand the value of what they’re getting?

                  Think about the amount of cash they are saving when it comes to going to a full-service agency who’s projects often range from $10k – $30k, easily.

                  Just another opinion :).

  12. Hello Tom! I am a senior at Arizona State University. I am doing a business story on WordPress and I was wondering if you would answer a few questions for me?!

    If so, here’s the list of questions:

    1) How would you describe WordPress’s business model when it first started, and how it is now in 2015?

    2) What makes WordPress different from other free blog sites?

    3) Why have “plug-ins” become the face for WordPress, and how is the company handling their users wanting to invent their own?

    4) How does WordPress profit from being a free blog site?

    If you could give me some insight on this topic, I would really appreciate it. Also, I might quote you in my report, is that okay with you?

  13. Perhaps for your themes, you have enough time to work on the hooks and compatibility? I find myself frustrated over ThemeForest’s WooCommerce bestsellers as all of them do not work well with WooCommerce extensions from Woothemes.

    Decided to go with StoreFront or build myself for the next project

Leave a Reply

This site uses Akismet to reduce spam. Learn how your comment data is processed.