Business Principals
One of the principals I founded my company on was to be as frugal as possible while not detracting from the service provided to customers or partners. Not only would this help me in keeping prices lower to differentiate from competitors, but it would also help to maximize profit. After releasing an update to the apartment sites earlier this week, I was alerted that users with Macs were experiencing problems. In the past I've done testing on Macs by going to my wife's place of business or using someone else's Mac. Now that I have some money available to spend, my first inclination was that I should head over to the Apple store right away and get a Mac Mini for $700. I mean, why go through all the hassle of having to find someone with a Mac every time I need to test and/or debug? Well, after some reflection I've decided that I need to stick to my principals. Having to go somewhere else to do a little debugging now and then, or having any other minor (and infrequent) inconvenience is worth not having to pay anything more than a hundred bucks. Plus, with that $700 I can get a decent amount of text ads, or even a terabyte back-up drive. I guess the moral is that the principals that define my business shouldn't just be a result of circumstance (like limiting spending when you don't have the money to spend), but should hold true throughout the lifecycle of the business.
- posted by Drew @ 3:08 PM  

 
Pricing Options Bad - Simple Good
I've found that my customers on the apartment sites want information regarding advertising purchase options to be clear, concise and simple. I can offer a myriad of options including purchasing a single month, monthly recurring to lump sum yearly and then they have the option to pay via credit card or to be invoiced. These are all standard options, but with various discounts that I can offer depending on the options chosen it just gets to be too complicated. I even have a form where you choose what you want and the pricing options you're interested in and it spits out the price and highlights any applicable discounts.

The feedback I've gotten is that it's too complicated. So my current belief is that even though I can offer a lot of flexibility with payments, it's better to offer no more than two options. In fact, I might be better served with having just one option. As I complete some new features that make further testing easier I'll report back what seems to work and what doesn't. For now though, my advice is to keep purchase options as simple as possible. You're likely to lose more customers due to pricing confusion than you might gain with offering flexibility and discounts.
- posted by Drew @ 12:21 PM