Comment by apsurd | Hacker News Reader

Comment by apsurd | Hacker News Reader

Just curious;

I never got these "for students" type of promotions. Everyone does it. Amazon, fogbugz, local pizza shops, and a ton of others I'm sure.

Maybe I shoudn't say "I don't get it", because I guess I do. The student label is pretty convenient and as everyone seems to understand it; "students are broke" because they have to pay for school and cannot work full time? Is that it?

A lot of people legitimately struggle to pay for things and are "broke". While it is true that being a student is a good thing, it does not entail that not being a student, (or maybe just specifically not being a student at a qualifying university that gives out .edu addresses or something) is a bad thing.

I guess my point is people struggle in all sorts of ways, and I would be happy to see a company say something more like "Free for people in need", "Pay what you can", or something like that. Ok so I'm not the best marketer but that would be nice in my book.

An open, honest, and truly unbiased form of helping out. =)

P.S. I guess I should put my money where my mouth is. I'll incorporate that into my side projects and hopefully I can refine it enough to share my results (and promotions) here with HN.

The answer (in general, though not in this particular case because the product is free) is price discrimination[0]. The basic idea is that by segmenting their customers roughly by ability to pay (students and seniors will on average pay less for your product than others) you can charge higher prices to everybody else. Otherwise, you would have to reduce your prices across the board in order to maximize profits.

[0]http://en.wikipedia.org/wiki/Price_discrimination

Ah, but students aren't just poor -- they're a tricker state, one which I'd refer to as "probabilistically temporary poor." Consider that people who read Hacker News are probably intellectually curious and are probably more likely to be computer science majors. It's also pretty likely that these students are bright and will grab decent jobs after graduation. After having exprienced the quality of Hacker Monthly, they will probably wish to continue. While they would no longer get the student discount, they now longer need it since they have acquired decent jobs. Since digital distribution costs practically nothing, the only cost to the distributer is marginal, but with the benefit that the students will probably become paying members in the future.

Exactly this. I'll attempt to speak for my kin here, I'm currently a student and while interested in Hacker Monthly, I couldn't justify paying (subscribing?). I entered my details in the form and hopefully I am eligible. If the product is interesting and useful I would have no problems paying (either when I'm no longer a student or even before that). I'm sure there are others like me and this seems like a case of "get them hooked young and they will be customers for life".

Great explanation. The price discrimination of note here is third degree price discrimination. I think the most vivid example of this type that people here have seen is how Apple's product lineup is composed and the various pricing they offer to different types of customers.

Also, most startups that have incremental pricing on their products (eg: wufoo, heroku) do this as well.

http://en.wikipedia.org/wiki/Price_discrimination#Third_degr...

The reasoning might be to get them used to your software/business/... to have them as customers later on when they will pay the full price.

For example Autodesk [1] allows students to get licenses for nearly all products for free but doesn't allow commercial use. Once they go into the business they have a few years of experience with Autodesk software and will probably stick to it.

This is the same for fogbugz (who also have a free startup edition - 2 ppl limit) and others.

[1] http://students.autodesk.com/

Also, it's a good way to develop loyal customer for the future. If your target customers are college educated white collars, then tapping into that market early is a great way to establish top of mind awareness of your brand for the future.

I imagine the reasoning is also related to the potential future income of students - they may be poor now, but their degree will bring them higher earning potential down the road.

Basically: hook them while they're broke, collect the cash when they're less broke.

One of the main benefits to discounting students rather than just anyone-who's-broke is that it's easy to prove that someone is really a student. It's not foolproof (some non-students can "prove" it, and not all students are broke), but it's the low hanging fruit.

I've seen a number of groups that organised recreational sports events that offer discounts to people who are students or unwaged. That seems to be kinda of what you suggesting.

A good example: http://www.madeventz.co.nz/tmrogaine/files/tm-entryform.pdf

Unfortunately this practise seems to be contained to the amateur adventure sport community.

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