Originally Posted by
DrSavant It's interesting how all the recent posts dealing with the price are being ignored by Wakeful.
Patrick, would you care to comment?
As I previously mentioned, our pricing was based completely off of our survey results. I knew by even charging over $1 that 45% of our all of our beta testers were not going to buy and by charging over $1 it was going to alienate those customers.
The median pricing from our survey results said our customers who would pay for the product would be willing to pay $7. Which has been the case, because we have been selling a bunch of these at that price tag, hence gaining traction on Mobihand best sellers list.
The problem is everyone here is only seeing the negative side of it... People are coming on the forums and posting comments to say they feel its too overpriced... What they aren't seeing are the emails coming into my inbox saying "Wow, $7 that's cheap" or all of the sales we are generating at the pricetag.
A lot of people are also saying that by charging this pricetag, we're going to go out of business cause no one is going to buy. If you look at Mobihand's top grossing applications, very little of them are under $5. By charging a higher pricetag we have less people using the product, which is causes less stress on our server, but is yields the highest return for us to add more features and benefits to those paying customers.
If we focused on those 85% of the customers who said they would pay a $1, we could have sold 10,000 units and made $10,000. Our servers would be maxed out, within one year that money would have been burnt by servers and development staff easily (probably less then 6 months). By charging $2 we would have immediately dropped down to a minimum of 55% of our users buying the product, so we would have sold 6,470 units at $2 and made $12,940. Or if 30% of our audience would pay $7 it would bring the total units to 3529 and revenue at $24,704. Heck, we had 5% say they would be willing to pay over $25, but that would have brought revenue down to $14,705.
These numbers are obviously fictitious, but they show you why and how we made our pricing decision. By charging $7 we knew that 70% or so were not going to be the happiest with the pricetag, but it would give us enough capital to put more developer resources towards making this product better. Even if we would have charged $2, 45% of our users would be complaining about the pricetag...
Our goal isn't to make so much money that we could buy a yacht tomorrow, it's to invest in the product to make it better and potentially make more products. You'll find most developers struggle to make cash from apps!