Task: Charge from day 1, and collect on day 30

Required Question

So, are you going to charge? Read: To Charge or Not to Charge.


How much? (per month or per year)


Do you offer different packages? If you do, what are they? Enter them each on their own line.

Many people feel that you should be charging from day one. This is true if you are providing a SaaS (software as a service). If you are building a service that needs to get users first so that one day you will have enough content and critical mass for it to be useful, then you probably shouldn't charge so early (Facebook, Linkedin, Youtube, Google).

Getting paid is the best form of validation, if your service immediately provide a value that people will be willing to pay for, then do go ahead and charge your customers. A company like MailChimp that creates their own content and has a service that you can immediately use can charge on day 1.

Also, if you are going to charge, a good method is to do the 80-20 strategy. This strategy is giving away 80% of your features for free, but charging for the other 20% premium features.

Additionally, the price of your product creates the perception of value for your product. Your pricing strategy will also determine what kind of customers you want to attract. If you have a product for corporations, then it makes sense to price it higher, because you are offering more value (supposedly), but with less customers. If you are selling to consumers, then it makes sense to price it lower, because you'd have more customers at a lower price. Therefore, sometimes pricing speaks louder than words.

Charging is also a great user-retention strategy. The reason is because when users pay to use your product, they will feel the need to get the most out of it. When they get the most out of it, they will fully reap the benefits of your product, and feel that it is truly useful. This also motivates them to recommend your product to your potential customers.

Case Study: Hermes' brand is built on their pricing (one of their bags costs more than 10,000!)

See this task for the best pricing practices.

See here to determine your pricing strategy