I'm looking at pricing for a new B2C-based SaaS, and I'm wondering if going with $2.95 or $3 per month would be considered "too cheap." Does anyone have any experience with this pricing that they'd care to share?<p>The reason why I'm asking is because the first time I saw a $2.95/month price plan a few years ago, I thought to myself "that's too cheap, they must be skimping on something." It was for JungleDisk (an online backup service).<p>I now know companies like JungleDisk (who use the Cloud) can afford to do this, so I don't think it bothers me that much anymore. But in your opinion/experience, when it comes to potentially subscribing to a new service, do you feel that some prices are "too cheap" and shy away from signing up? Along the same lines, do you think customers who don't know about the Cloud would avoid signing up if the pricing looks "too cheap?"
Make it an annual sub if you think $3/month sounds too cheap. But in general pricing is one of those things you only learn by trial-and-error, so stick up an A/B test and see what converts better.<p>edit: Also offer multiple levels of pricing, offer a "premium" product with a few extra bells and whistles for people who want to pay more.
I'm not sure whether $3 is too cheap, but I've noticed a few sites use ~$25 annual subscriptions.<p><a href="http://flickr.com/" rel="nofollow">http://flickr.com/</a>
<a href="http://backpackinglight.com/" rel="nofollow">http://backpackinglight.com/</a><p>I sure there are many others.
It's hard to start low and then raise the price, w/o a substantial increase in the number of features.<p>Psychologically, a better approach is to start high (i.e., at the highest per month you think people will pay), and only drop the price over time if you're not getting enough subscribers.<p>If you do stay in the $2, $3 per month range, though, then definitely make it one charge of $24 to $36 per year.
I would think it depends not so much on whether your users can afford it, but whether you can sustain development on $2.95/month. The price difference between 0 and 0.01 is huge, but between $2.95 to $8.95 is minimal. If you are going to charge for it, charge for it so you can keep supporting it.
I wouldn't worry too much about people thinking the price is too cheap. I'd wonder how many of those people paying $2.95/month would also be willing to pay $9.95/month, $19.95/month, etc.
Offer it for $36/year, as a customer I'd go nuts about receiving a monthly bill about a lump sum.
And offer a premium version with a little extra and quicker support for $36/MONTH :)
i think that depends on your product. what is your target group? is there a pattern on how wealthy this group is?<p>is the service very specialized?<p>when a/b testing, interpreting the data correctly is key.<p>take your time and try stuff...