How to generate more revenue from your web application today | Hacker News Reader

How to generate more revenue from your web application today

nathanbarry.com

114 pointsnathanbarry31 comments

I'm dealing with this right now in the worst way. My product actually depends on a subscription to another service, which is massive and priced ridiculously (JIRA). It's a hard sell to say that my service is worth as much as the platform its built on, but it works out that way for some customers.

I was considering dropping the price and making it a long-tail type of service, but I'm still excited about plowing lots of development effort in. This just reminds me that for businesses, the difference between 5 and 10 dollars is minimal, but for me, it's enough to keep the lights on (metaphorically, my office/apartment is very dim). I'd rather try to grow the customer base the hard way and then keep giving them more value for money.

Edit: my app is FocusTi.me, at http://start.focusti.me. I welcome any feedback, I haven't really started promoting it yet.

Btw your font choice looks horrible on Windows (IE9, Chrome, FF): http://d.pr/i/qK9i

There has been a growing number of not-tested-on-Windows sites which need some serious testing on modern Windows machines because the fonts look really bad.

Thanks for that. I actually develop on Linux, but either way Windows is definitely most of the market. I'll shop around and see what I can find.

Fonts that are not native always seem to have issues for me on Windows if they are not big enough.

The best option is usually to use a native font like Calibri or some of the many other fonts that windows comes with or increase the size of the font quite a bit.

The font your using looks kind of bad to me on my linux box because it seems more geared towards headings and larger font sizes because of how condensed it is.

You may want to consider one of the more used but good looking fonts like PT Sans or Open Sans

In case my comments - or more likely my design - didn't give it away, I'm absolutely not a designer. Open Sans was a great tip, and the point about condensed versus paragraph text was eye opening. I've basically applied those points now, I haven't tested on a windows box yet but hopefully it's more legible.

Thanks for the 5-minute font picking lesson guys :)

Looks a world better, great job!

Hey got an off-topic question regarding JIRA: is it possible to have a test-account to develop 3rd-party software for their on-demand (studio) web-app? and is there _THE_ stable developer document I can read + use to extend JIRA? (Their KB/Wiki is rather convoluted).

Once in a while I'd like to implement a plugin or something for my current workplace internally but I tend to get overwhelmed by the sheer amount of documentation and various versions of JIRA.

Thanks!

I took advantage of their $10 for less than ten users plan and created a jira just for dogfooding. You do get one month free.

Personally, their documentation is the stuff of nightmares. If you look at their REST API, you can do some good stuff with just HTTP basic authentication. Its all pretty well contained here:

http://docs.atlassian.com/jira/REST/latest/

Personally I chose to host my app myself, to avoid the pain of their marketplace and get experience with Heroku and Ruby. But as far as I can tell they will also host your app if it meets certain criteria.

Send me an email if you have any specific questions, I'd be glad to help you get set up.

edit: keyboard exploded mid-word

Hey thanks a lot for the info!

Much respect for your focus and execution on shipping your app. I don't mean to criticize your work in any shape or form but I'd agree with some of the people in your sub-thread: change the font :) (maybe it's just my personal taste though). It's rare to see web to use this particular font these days and it may be a bit of a turn off (may not be a deciding factor).

I think you need a better landing page. Right now it's tough to see what your app does right away, the font's a bit tough to read as well. The sign up page doesn't do a good job of showing pricing in a clear way as well.

I'd also consider drastically increasing your prices if you can chat with customers and see what type of value you're delivering...divide it by 10 and charge that much. I find it tough to believe you're only delivering $50-$100 of value to people if the service this app works with is a ridiculously priced piece of software.

The thing is, their pricing goes from $5 to $1 a seat on a sliding scale. I meant ridiculous more in terms of commoditizing itself. My goal is that the current iteration does one thing well. I'm sure as I get requests I'll be able to add more features to offer higher tiers.

Yea I suppose so, just seems like it's quite low priced...certainly worth a test!

What is JIRA? Sure I could google it, but when you talk all that JIRA stuff I have no idea what you mean or how much it will cost to get JIRA-fied or JIRA certified or whatever - and I am someone who may be interested in this.

Democratize your service. Be more welcoming, even to those who haven't been baptized into the JIRA faith.

  The Book ($39) – 226 copies sold
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  The Complete Package ($169) – 100 copies sold

In my experience real price elasticity only exists in business books. The author's example illustrates what tends to happen in real life: something that is 1/4 of the price rarely sells 4x better than the 1x-priced product. This generally means that you are leaving money on the table. The problem is that testing pricing can be a difficult art to master.

In some market segment selling a cheaper product in exchange for volume can actually cost you a ton of money. In hardware, for example, the customer looking for rock-bottom pricing will often be the most demanding in terms of support requirements as well as the expected value delivered.

I agree. all those price elasticity examples depend on at which point you are on the demand curve for your individual product offering.

The "charge more" advice should be common sense in this day and age. I'm very surprised it doesn't get taught in college marketing 101 courses. I read a book on salesmanship published in 1929 teaching the same exact thing to salesmen and Cialdini wrote at length about this phenomenon in his book Influence.

You're right, it should be common sense, but it's not. Just look at all the "Show HN" posts. Charging too little is still a very common problem.

Some advice from a prospective customer: if you can't/don't want to offer free plan, at least give me a trial that's long enough to actually try out your product. Two great examples that come to mind:

1. Mixpanel vs. Kissmetrics: Mixpanel gives me a free account that I can use for as long as I want to evaluate all the stuff I can do with it. KM gives me a 14-day trial. I'm the only developer working on this project which means that 14 days is not enough time to implement the changes I need and actually start to see the results. Going with Mixpanel for this one was obvious. I will reach their free 25k data points way before the first month so I have to get a real paid plan or put a banner on my website. In any way, they won already. Even if I wanted to switch to KM for the lower prices, exporting the data I currently have would be a hassle.

2. The New Basecamp: Although they don't offer a free plan anymore, they do have a 60 days trial. They don't really lose much by offering those extra days and after two months I'm already hooked to their service, I know how everything works, and most importantly, they have my projects tied down. The work of those 2 months is already there so even if I don't like the product, I'll probably pay for it so I don't have to export it. Joel Spolsky has a great article that talks about this retention thing (his specific example was with email providers) but I can't find it right now :(

Rob Walling on Startups for the Rest of Us had a different take on it. One of the things that dropping to a shorter (14 days vs 21 vs 30 vs 60) is that it lets you iterate your marketing A/B tests much faster.

Absolutely love Rob, he's helped us out at www.serpiq.com quite a bit. We moved from freemium to a 7 day trial with the launch of v2.0 of our product, while at the same time raising our prices. While we did lose some customers due to switching to Stripe instead of another payment gateway, our metrics are looking really healthy and we have the opportunity to iterate a lot faster with a 7 day trial - then again, our product doesn't require a lot of time to realize value.

Which matters more, iterating tests faster, or getting to a better result? In my books, a better result.

Here we have an actual customer here saying that uselessly short free trials will drive him to a competitor that offers a useful free trial. And the customer had an actual example to point to of it happening. If this is a general trend, then it is impossible for the best optimized short free trial to match the best optimized longer free trial.

And yes, long conversion cycles are a PITA. However they are sometimes a necessary PITA. Furthermore a long conversion cycle (if needed) is a useful barrier to entry for competitors who will need more float to survive, and who will learn more slowly.

I'm surprised to see no mention of the Decoy Effect..

https://en.wikipedia.org/wiki/Decoy_effect

Finding out about this kind of thing is exactly why I come to Hacker News. Thank You, eminent kefs.

If you like that, watch this TED talk: http://www.ted.com/talks/lang/en/dan_ariely_asks_are_we_in_c...

Thank you!

Contacting customers with invalid billing information is definitely a good tip. I was surprised to find out at 17% of our subscribers for StartupThreads were delinquent. Some had cards stolen, numbers changed, expired, etc. Wish I had taken their phone numbers to reach out easier, but sending a few friendly reminder emails will help.

Stripe can do this automatically with WebHooks; it's seriously worth taking the time to set up.

This list is just a starting point. I would love to hear what all of you have found works for increasing revenue. Stories are good, specific numbers are even better!

Please do not substantially raise your prices all in one shot.

I watched in horror as the old marketing manager jacked our prices 50% one day. Everyone complained. He had to drop them back to their original levels.

Do it in baby steps.

There is a big difference in changing the price for new users and pitching an increase to your current users. If you are going to price test, do it on landing page visitors (if possible). Grandfather in your current customers at current prices if you can (which might even increase retention), or if the economics prohibit that, explain why the increases are necessary. "We think we can get more from you" is probably not a good reason from your customer's point of view.

This is a very good point. I should have clarified that I mean to charge more for new accounts. If you are going to increase prices on existing accounts do it on a case-by-case basis.

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