Follow-Up on Our New Pricing
July 19, 2012 - Culture・Product Updates
We’ve received a lot of very helpful feedback (from our very amazing community) about our new pricing since we announced it a few weeks ago. Most of it’s been understanding and positive, though there have been many users that have expressed concern about how it’d be received by their clients. Since the last post was so epicly long, we’ll try to keep this one short and to the point.
(If you read nothing else, make sure you see the pretty and informative graphs below.)
Changes to our New Pricing Based on Your Feedback
Merchants with Low Priced Items are Unfairly Hit
This is something we’d considered prior to announcing the new pricing, and the feedback confirmed our thoughts. At a flat 15¢ or 5¢ transaction fee, merchants selling $0.99 or $5 transactions are hit radically harder than those doing $30 or $100 average transactions. To remedy this, we’ll be making the flat transaction fee percentage-based up to the maximum amount. On the Standard and Advanced plans, the fee will be 0.5% up to the maximums (15¢ and 5¢ respectively), with a minimum transaction fee of 1¢ (which really only would apply to sub-$2 transactions).
Also worth mentioning is that we’ll take into account commonly used currencies here, so the calculation for this fee will take into account the currency of the transaction itself.
Non-Profit Pricing
This is something that’s come up many times over the years, and with this new pricing we’re happy to offer a 10% discount to not-for-profit entities. This discount applies to all fees, and is available in the admin for stores that have submitted their proof of non-profit status to us.
Custom SSL Certificate Included in the Advanced Plan
We’re happy to now include the custom SSL certificate in the Advanced plan. Because of our costs for the cert (and the IP addresses, security scanning, DNS, and other systems) we can’t bundle this into the Standard plan without increasing the price significantly, so it will remain the only paid upgrade on the Standard plan. (All other upgrades like multi-ship, storage space for downloadables, and etc. is all included, and still unlimited with the new plans.)
The Feedback and Survey Data
Overall, the survey responses are very positive to the new plan. Not everybody was thrilled, but almost everybody was very supportive even in their criticism. Many of our users expressed explicit support for the new plans, which was great for us to see, though there were some common threads. Most were discussed above, but we’ll address a few of the others quickly:
The jump from $15/mo to $250/mo is huge. Some users didn’t like the prospect of a variable price from month to month. Others just really felt like there should be a plan in between. At this point we’re going to leave it as is; since all functionality is unlimited at this point, and since the price scales gradually from $15/mo to $250/mo, we’re hoping that improved communication addresses this concern.
Even $15/mo is too high for micro-merchants and startups. We’d really love to support micro-merchants, and some users suggested things like $10/mo or even $1 or $3/transaction with $0/mo. Our concern is that merchants without a budget for $15 or $20/mo probably don’t have the budget to hire a competent web dev, in which case FoxyCart very likely just isn’t the solution for them in the first place. That said, this is something we’ll continue to look at, as we’d rather serve the web developer with small clients, since that web developer hopefully would eventually grow to serve larger clients that could afford higher monthly fees.
We need an affiliate program. We actually have one, though it’s been targeted mostly to integration developers. We have plans to revamp the affiliate program and add a FoxyCart Partner Network as well, where we could send new and existing users who need assistance from FoxyCart-experienced developers.
3 Different Surveys for 3 Types of User
When we sent the email announcing the previous pricing blog post last week, we sent it in three versions:
Admin users for stores doing 100+ transactions/mo.
Admin users for stores doing 0-100 transactions/mo.
Admin users for non-live stores (ie. doing no live transactions/mo).
We were hoping to glean at least a few insights on the opinions of different types of users, and there’s one piece that sticks out in the responses:
Flat Monthly Fee v. %-Based Transaction Fee v. Flat Transaction Fee
The most interesting differences in the survey responses were for question #7:
How do you feel about the following pricing options for FoxyCart?
Some graphs are below, but the conclusions are:
New users (ie. users that haven’t yet starting paying FoxyCart so aren’t under any existing plan) greatly prefer tiers by usage (transactions/mo).
Existing higher-volume users unsurprisingly prefer the current $19/mo plan, but they also are much more agreeable to tiering by features than by usage.
Existing lower-volume users seem to like and dislike everything pretty much equally.
ALL current usersreally dislike a %-based transaction fee.
A discount for annual billing is liked by most all.
The following graphs give a much more tangible idea of just how much more positively “new users” react to a per-transaction pricing structure. Blue is better. Green is worse. (Thanks again to AskYourTargetMarket for the survey tools and pretty graphs.)
Grandfathering In Our Existing Users
One of the biggest concerns our current users have expressed is that the new pricing is hard to swallow. We understand, and as we mentioned in our previous post, if you want to upgrade to FoxyCart 1.0+ but would like to keep your current plan simply let us know when you’re ready and we’ll grandfather you in.
(It might be surprising, but most of our higher-volume stores have already contacted us to let us know they want to pay more. No joke. The general consensus is that they now feel they can continue to grow their businesses without needing find a new ecommerce system, as they’re more confident FoxyCart will have the resources required to serve their increasing needs.)
The $100 Gift Card Winner!
We tweeted about this a few weeks ago, but Kristin S. in California won the $100 gift card. She also had this to say on the survey she filled out:
I <3 foxycart
Though we would have given her the award even if she hated us, it did make us smile 🙂
Some Responses
Most of the responses were very positive:
I prefer the tiered pricing so that it allows smaller merchants the ability to have a store without high costs and larger merchants to pay according to size.
We pay $19/mo, and I don’t feel like I deserve any support for $19/mo. I didn’t want to use FoxyCart for $19/mo because I thought it was too cheap to be a good solution. I thought it was a one-man operation or something. I’m already at the advanced plan level, and it makes me more comfortable to pay that than $19.
Now that you bring it up, the transaction-based pricing model makes a lot of sense.
We want you to succeed and prosper. 15 cents per transaction seemed like a lot at first, but it’s actually quite reasonable compared to some other vendors.
Though as mentioned there were many users that did see the need for a lower priced plan:
I’m happy with what I have but thinking about smaller businesses maybe a sliding scale. It’s hard to commit to even $15/month when you are building a business and don’t have a huge amount of cash flow.
From Here…
Thanks again to all of our users who took the time to give us feedback. We’re doing this to make your lives easier, and every piece of feedback is valuable. We’re excited to move forward with FoxyCart, and if there’s anything worthwhile to report on the impact of this pricing change we will blog about it in the future. Our hope is that we can serve more merchants of all size, which will allow us to grow our team and continue to provide innovative solutions to your ecommerce challanges.