Quote:
Originally Posted by V_RocKs
I think your idea on the math is flawed... If you priced it at $500/$99 and end up with 10 users that is $5000 now and $1000 a month.
If you did it at $200/$89 I am sure you'd end up with 18 users at $3600 and $1602 a month. After three months you are at the same spot and from there on you are making more than you would have before. Not to mention you can then offer specials, etc at that point to entice others to get in on the $89 monthly and increase that user base to 50. At which time you can offer a price drop across the board of $100 setup and make all new users $99 a month and grab another 20 users...
Gives you $2000 bonus and another almost $2000 a month...
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V, I understand that the setup is a one-time payment so as much as I would like the big money up front, the real pay off is in the monthly fees. Below is the pricing breakdown I came up with before posting this thread:
$1000 + (12*50) = $1600
$750 + (12*75) = $1650
$500 + (12*100) = $1700
$350 + (12*125) = $1850
$100 + (12*150) = $1900 - must sign up for 6 month contract
After the initial setup fees are assessed, the obvious best for me would be the $100 setup and $150 per month. I think the real question is do I want most of the money up front or rely on the monthly fees and hope I am able to retain customers. The $100 setup has to agree to at least a 6 month contract.
Right now I am leaning towards the $350 setup and $125 a month. And to help lessen the initial hit, break the setup fee into 3 monthly payments so I can get more sales.