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Chargify New Pricing

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Re: Chargify New Pricing

#101

Post by jacquesm »

tworats wrote: post #98
jacquesm wrote: post #96

Earlier quoted context omitted.

> here are plenty of people who want to start subscription businesses, and out of those, the vast majority will not succeed and will actually end up costing more than they ever bring in. That's not exactly news, that's why you try to get a good grip on the life-cycle of a cross section of your potential customers before you set a pricing scheme. A free customer should work out at any level of scale and any life cycle…

> they'll be spending a lot of money on airline tickets to warm and sunny places trying to get merchant accounts from banks The merchants bring their own merchant accounts. Chargify doesn't give you a merchant account; they use the one you bring.

That's a good thing.

There are companies that will use a single merchant account across all their merchants. Essentially you pay for the privilege of not having to get your own account.

Typically these services grow like mad and then explode. Happy to hear that chargify at least is not one of those.

Re: Chargify New Pricing

#102

Post by jtchang »

I got this e-mail today and was totally floored.

This is going to turn into a marketing/PR disaster for Chargify. They even sent out another e-mail to try and make up for their initial "mistake".

Customers are very sensitive to pricing changes. The minute you decide to change pricing you should be thinking about it long and hard. While you are doing it you should be communicating to customers that you are thinking about a pricing change and solicit feedback. You need to be gently breaking the news to them.

I signed up for Chargify to check out their pricing. I liked the fact that you could have 0-50 without paying anything. Considering development for a specific platform is not free this sudden pricing change has forced me to consider alternatives.

As a customer who was just considering using them I feel kind of violated.

Re: Chargify New Pricing

#103

Post by cglee »

ntalbott wrote: post #100
cglee wrote: post #58

Earlier quoted context omitted.

Last time I looked, Spreedly's API and functionality wasn't even in the same ballpark as Chargify's. I've worked on integration projects with both, and Chargify is much better and more configurable. Spreedly may have improved, it's been a while.

On the one hand, I agree with you - Spreedly's not as feature rich as some of the competition. On the other hand, we have a lot of very happy customers, so that doesn't mean we're not a good fit for a significant set of startups.

Very true, please count me as one of your satisfied customers. In a different comment, I did say Spreedly would be a great fit for those who just want a straight forward recurring billing solution, without deep API integration and other features offered by Chargify/Recurly. I forgot to note that here.

Re: Chargify New Pricing

#104

Post by jread »

If you are bootstrapped and need low cost recurring payments capabilities here are a few fully outsourced and PCI compliant services you could consider:

PayPal Website Payments Standard: 2.9% + $0.30/trans https://merchant.paypal.com/cgi-bin/marketingweb?cmd=_render...

Google Subscription Payments (experimental): 2.9% + $0.30/trans http://code.google.com/apis/checkout/developer/Google_Checko...

Aria SubscriptionPlus (via PayPal partnership): Free trial, then $40/mo https://merchant.paypal.com/cgi-bin/marketingweb?cmd=_render...

Re: Chargify New Pricing

#105

Post by jacquesm »

cglee wrote: post #103
ntalbott wrote: post #100

Earlier quoted context omitted.

On the one hand, I agree with you - Spreedly's not as feature rich as some of the competition. On the other hand, we have a lot of very happy customers, so that doesn't mean we're not a good fit for a significant set of startups.

Very true, please count me as one of your satisfied customers. In a different comment, I did say Spreedly would be a great fit for those who just want a straight forward recurring billing solution, without deep API integration and other features offered by Chargify/Recurly. I forgot to note that here.

Deep API integration translates in to 'more lock-in'. Better try to handle as much of the business logic other than the initial add, the rebilling and the deletions upon account expiry yourself.

Keep your interface to services like this as thin as you can get away with without compromising customer comfort, in the long run you'll be very happy you did.

Re: Chargify New Pricing

#106

Post by cpr »

carbocation wrote: post #95
cpr wrote: post #93

With Patrick, I guess I understand the screams of pain on the unlooked-for price hike, but, even at the lowest non-developer level, you're only paying $0.20/month per customer. Assuming you're charging your customers at least $5/month, that's only $.04/customer/month, or less than 1%. Seems like a reasonable amount to pay for removing all the pain of recurring billing.

It's only $0.20/month/customer if you have 500 customers. If you have one customer, then it's $99/month/customer.

Good point, but if I were starting something that depended on recurring revenue, I wouldn't really begrudge $100/month to one of the most critical parts of the whole solution.

Compare it to the $65/month I pay for a single Verizon Mifi data card, and it doesn't seem bad at all.

Maybe you can't really look at per-user costs when you only have a handful of users. Everything looks badly distorted as you head up asymptotically from zero users.

Re: Chargify New Pricing

#107

Post by dangrossman »

jacquesm wrote: post #96
ntalbott wrote: post #90

Full disclosure: I run Spreedly, an earlier to market but much less funded competitor to Chargify. Here's the dirty little secret that Spreedly discovered about 18 months ago, and that I'm sure Chargify - like Recurly before them - has now found out for themselves: there are plenty of people who want to start subscription businesses, and out of those, the vast majority will not succeed and will actually end up costin…

> here are plenty of people who want to start subscription businesses, and out of those, the vast majority will not succeed and will actually end up costing more than they ever bring in. That's not exactly news, that's why you try to get a good grip on the life-cycle of a cross section of your potential customers before you set a pricing scheme. A free customer should work out at any level of scale and any life cycle…

> Wait until they start getting in to more and riskier transaction volumes, they'll have to add up to 30 cts per transaction worth of fees for various services to help with scrubbing the bad stuff from the good stuff to keep the chargeback rates in check.

Selling a billing logic service to businesses isn't exactly high risk. Their customers' users' payments do not go through Spreedly/Chargify... they just talk to the API of the customers' payment gateways using their customers' credentials. Any end-user chargebacks related to the subscriptions are on the customers, not Spreedly/Chargify.

> Do you guys do segregated merchant accounts (one merchant account per customer)? If not how will you deal with a merchant account issue once your volume is larger and you start to attract 'bad apples'? (like everybody else that ever did multiplexed merchant accounts)

You misunderstand what these services are. They do not provide payment processing in any way. They are only selling business logic the app developer would normally have to write.

Re: Chargify New Pricing

#108

Post by adraper »

As a Chargify customer from very early on & having been in a paying position since early March (we launched in mid-January & it took a month & a half to hit a paying level) would we have used Chargify from the get-go if we had to pay for it? I can't say for certain but it's quite likely as it still would've been cheaper than moving development cycles into building a billing system (as it is we're still backlogged in that dept).

If I was running a business that relied on a lot of freemium customers I might think twice, but then unless you're asking for credit cards up-front just don't put them into Chargify until they upgrade and give you their CC details. We handle gift subscriptions this way, unless they convert to a 'real' subscription when their gift is up they never go through Chargify.

For what it's worth, it's safe to say after using Chargify for almost a year and having an active site using it for 9-10 months, the level of service and support we've received has been more than worth what we're paying — our development backlog is already a pain-point, I can't imagine what it'd be like if we were rolling our own billing system.

Re: Chargify New Pricing

#109

Post by dh »

ntalbott wrote: post #90

Full disclosure: I run Spreedly, an earlier to market but much less funded competitor to Chargify. Here's the dirty little secret that Spreedly discovered about 18 months ago, and that I'm sure Chargify - like Recurly before them - has now found out for themselves: there are plenty of people who want to start subscription businesses, and out of those, the vast majority will not succeed and will actually end up costin…

Appreciate the thoughtful response and great to see a competitor growing in the space, brings everyone up.

Re: Chargify New Pricing

#110

Post by rwhitman »

MicahWedemeyer wrote: post #23
mthomas wrote: post #11

Chargify requires that you setup both a payment gateway and a merchant account. Why would you use them instead of just integrating with the gateway directly?

Chargify handles a lot of the recurring aspect, dealing with expired cards, notifying you if someone doesn't pay, etc, etc I talk a little about it here: http://peachshake.com/2010/06/15/saas-subscription-billing-o... It was a great deal for the price, but now...not so much.

Your post did a good job of pitching chargify, I was passing it around the other day for justification to go with them. Such a bummer that they pulled this
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