This is probably a signal you should raise your prices.
Ask HN: My startup has more annual subscribers than monthly. What to make of it?
71–80 of 136 posts
Re: Ask HN: My startup has more annual subscribers than monthly. What to make of it?
#72Where are your customers in the world? Many non-US countries have little/no credit card presence, so if you don't have an international-friendly payment option like PayPal your customers may be using "gift card credit cards" purchased from a store. It's easier to do this once a year than once a month. Ultimately though, talk to your users! That's how you'll find out.
> Many non-US countries have little/no credit card presence Was that statement accidental horrible wording or did you actually mean it ? If the latter, then you must be one of those many Americans that needs to travel more. The rest of the world are not neanderthals who've never heard of credit cards. Go to Kenya (Africa) and the only reason you might struggle to pay by credit card is if the merchant has decided to p…
I am in EU and around me people use credit cards only if America requires it for some reason. I don't even own it.
Re: Ask HN: My startup has more annual subscribers than monthly. What to make of it?
#73If it's B2B, it's easier for business customers to get a once-a-year expense paid than to get authorization for a monthly charge to a corporate card. Many organizations don't like having their corporate card numbers enrolled in open-ended recurring charge plans.
Yup. Also if you’re in a more bureaucratic jurisdiction (like Sweden, where I am) then the bookkeeping of monthly charges can be more expensive than the SaaS.
Re: Ask HN: My startup has more annual subscribers than monthly. What to make of it?
#742 months off for paying annual pricing is a very good deal for someone who plans to use you product on the long term. I personally have a few items I pay for annually because I don't see myself stopping from using it AND there is no obvious replacement. I would NOT recommend changing the 2 months off; you'll annoy your most loyal customers.
I absolutely don't plan to change any existing subscription; everybody always gets grandfathered in forever. The early adopters' invaluable feedback + potential bad rep from raising prices is reason enough. I'm mostly looking for advice on how to price things for my future customers :)
>2 months off for paying annual pricing is a very good deal for someone who plans to use you product on the long term.
I too pay for some things on an annual basis (e.g. email). I guess never expected my product to be sticky enough for people to want to go annual straightaway. To be very blunt because I'm anonymous, how do I monetize this stickiness to extract maximum value from future customers?
Re: Ask HN: My startup has more annual subscribers than monthly. What to make of it?
#75I think it means you're dialed in just right.
Re: Ask HN: My startup has more annual subscribers than monthly. What to make of it?
#76Earlier quoted context omitted.
Dunno, in a lot of europe, though credit cards are readily available , most of my family (I have relatives in Germany, Austria, Slovenia, Croatia) doesn't have or want them. They have forms of payment which are strange to me but basically are some form of bank debit card, accepted everywhere. Or fancy phone / app payment methods we can only dream of here. I didn't read the OP as necessarily implying technical or cult…
When a form on a web-site says CC (Credit Card) I can always pay with my debit card. (Unless you're talking about another sort of debit card that isn't what I call a debit card - "a MasterCard/Visa/etc with no overdraft). To me it seems like some people use the term "credit card" for any bank card, while some actually mean the "credit" part. While "credit" (non-debit) cards don't seem to be THAT popular in the Europe…
>>When a form on a web-site says CC (Credit Card) I can always pay with my debit card.
Here in Canada, many debit/bank cards now have affiliation with Visa or Mastercard (obvious with a logo in corner), and CAN be used as Credit Cards.
But that hasn't been the case historically - debit/bank card would work on bank's ATM and related Interact/Plus systems. But until semi-recently would NOT work if you accidentally hit "Credit" instead of "Debit" on ATM or retailer's POS system, and would NOT work on websites requiring Credit card - completely different paths. And to my knowledge many bank/debit cards in Canada still cannot serve as credit cards - they just don't have that capability/afiliation baked in.
Note - I speak as a semi-observant customer, I have no systems-based knowledge of these things :-)
Re: Ask HN: My startup has more annual subscribers than monthly. What to make of it?
#77If it's B2B, it's easier for business customers to get a once-a-year expense paid than to get authorization for a monthly charge to a corporate card. Many organizations don't like having their corporate card numbers enrolled in open-ended recurring charge plans.
I see. My product is somewhat in between B2B and B2C (i.e. plenty of regular folks subscribing for their personal use, but also plenty of companies using it). Perhaps this is a strong signal in favor of price segmentation to make future B2B customers more than personal users?
Re: Ask HN: My startup has more annual subscribers than monthly. What to make of it?
#78Earlier quoted context omitted.
Dunno, in a lot of europe, though credit cards are readily available , most of my family (I have relatives in Germany, Austria, Slovenia, Croatia) doesn't have or want them. They have forms of payment which are strange to me but basically are some form of bank debit card, accepted everywhere. Or fancy phone / app payment methods we can only dream of here. I didn't read the OP as necessarily implying technical or cult…
How do you know what cards your relatives in other countries have?
I mean, if genuine question, how do you know anything about your family? :)
You talk, you notice when you go shopping together, etc :)
Re: Ask HN: My startup has more annual subscribers than monthly. What to make of it?
#79Earlier quoted context omitted.
> On the yearly subscription, do you charge for the entire year upfront? I mean, to my knowledge, that's the whole reason to give a discount for the yearly payment. Isn't it?
Yearly contracts paid monthly give a great income predictability already which mitigates risk. Also customer retention / CLV might be better, because users pay until the end of the 12 months despite stopping using the product earlier.
There's more risk there, though, no? A customer could cancel before the end of the year and simply stop making the remainder of the payments. Sure, there's recourse, both through the credit card companies and courts, but that takes time and effort and possibly lawyers (aka money).
If you require annual customers to pay the entire year up front, you get the money, and that's that, barring credit card chargebacks.
Re: Ask HN: My startup has more annual subscribers than monthly. What to make of it?
#80Because the discount rate of the yearly plan is financially very attractive (17% off), there are really two main reasons people go for the monthly option: 1) they are unsure if they are going to like your product enough to be willing to go for the bigger commitment of the yearly subscription 2) they can’t afford the yearly payment upfront (this is especially valid for very expensive subscriptions) On the yearly subsc…
>On the yearly subscription, do you charge for the entire year upfront? Yes. The annual subscription is >How is the distribution of vintages of your user base? My startup is fairly new (12-18 months old), so I don't have much insight into such statistics. However, I will note that growth has somewhat stagnated ( >it’s almost always a good idea to do it without disrupting (too much) your existing user base. Absolutely…
Sounds great.
Maybe, in addition to working on price segmentation, one way to leverage the behavior (“stickiness” as you call it) of your users is to create a mechanism to make them refer new customers to you: you can create an inexpensive growth engine, for example like Dropbox did with its referral program.