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Comment by whyleym | Hacker News Reader

Very interesting.

The concern I could see with this would be that you raise your price for a few days - you get a few takers but not as many as you hoped, so you lower the price back down to the original levels. I'd be a little concerned that those who subscribed at the higher levels would not be happy paying a higher recurring monthly fee when they could now subscribe to the product at a cheaper rate.

Would you / did you just manage those users back down to the original payment levels for the future months payments ? Or leave them at the higher payment levels and manage on an adhoc basis should they raise issue with pricing levels.

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I refunded them the difference and apologized for the 'mistake'.

It doesn't sit 100% comfortable suggesting this was a 'mistake' - not saying this doesn't work - just that I don't feel entirely comfortable with it.

To follow up on this - with A/B price testing how does this work when you are lowering and raising your prices all the time - what's the general approach - to admit 'mistakes' or refund the difference or just manage on an adhoc per issue raised basis ?

Agreed, but I would feel even more lousy continuing to charge them the higher rate while charging less to others.

You don't lower and raise your prices all the time, you do it once to determine the sweet spot and then you stick with that for a much longer time.

For me it was exactly as described: 2, evaluate, 2, evaluate, *2 evaluate -> go back one step.

At each step we had at most a few hundred signups processed before we made the decision.

The fact that it took as long as it did is only because I was skeptical, I should have realized much earlier that it can't cost too much to try, after all your signup rate would have to halve before you start to lose money.

Makes sense. Did you refund all users or just those that raised an issue ?

All of the ones that were paying the higher rate.

It seemed to be the most fair way to deal with it.

http://news.ycombinator.com/item?id=1640850

Whether or not you choose to call it a "mistake" and how you handle it depends entirely on the business model, image, product, customers, etc....

A recurring service that is purchased, where you priced things too high and saw prices drop off, and then quickly moved it back - telling the customers who paid too much, and who would likely get pissed and leave when they find out you were unlucky represent an opportunity to market yourself - saying "Hey, we over did it a bit - we're crediting what you already paid forward at our new reduced rate, and keep charging you at that rate going forward, we appreciate your business!". If anything, that's going to make your customer who was willing to pay double what you are now charging him happy, and spread the word. Who doesn't like to find out they just got a 50% refund?

It's also interesting to note how different the iOS AppStore is from most of other stores. Some apps keep changing the price from 0.79 eur to something higher and then back again.

This is easier to see with one of those apps that keep track of apps that lowered their price, some of them keep appearing on that list.

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