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Slack’s free plan change is causing an exodus

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Re: Slack’s free plan change is causing an exodus

#621

Post by ryeights »

ghaff wrote: post #600
hnarn wrote: post #481

Earlier quoted context omitted.

Everybody understands this. Here’s what companies don’t understand: if you promote your product through a loss leader — which is arguably how Slack became popular in the first place — changing your pricing at a later date will piss people off. You’re trying to put the blame on the consumer here which never makes any sense from a business perspective. If your loss-leading pricing strategy was unsustainable from the st…

>Here’s what companies don’t understand: if you promote your product through a loss leader — which is arguably how Slack became popular in the first place — changing your pricing at a later date will piss people off. I'd argue that most companies understand that perfectly well. They have a generous free tier to drive growth. Once that growth is attained and demand starts to level off, it's time to trim the resources…

Note that Heroku and Slack are both owned by Salesforce.

Re: Slack’s free plan change is causing an exodus

#622

Post by immibis »

oblio wrote: post #615
immibis wrote: post #610

Earlier quoted context omitted.

Any. Every. Whatever the user has. Banks already figure this out amongst each other - the browser just needs to convey an IBAN (or other format), currency and amount to the user's bank and let it be their problem.

Exactly. I proposed SWIFT and people latched onto to it to criticize when it was just a detail. You put it better, just have any layer on top of IBANs. 0 need for crypto.

However, the API should also be able to support crypto payments, by getting a crypto address and then forwarding the request to e.g. a local instance of Metamask, instead of my bank.

Perhaps if the user has multiple bank accounts linked, they would have to choose one, to avoid leaking to my bank that I'm making a crypto payment.

Of course, a crypto transaction has a significantly lower chance of being compatible since there's no foreign currency team working at the bank - if the website wants a payment in BitWhatsits and my primary wallet is in DOGEMONEY 20000!!!!! then it's up to the user or at least the extension to figure out the routing. Probably, the website would offer a different button to pay with each supported cryptocurrency, so the user would choose. They'll be accustomed to that, being a cryptocurrency and all.

Re: Slack’s free plan change is causing an exodus

#623

Post by ivan_gammel »

ImPostingOnHN wrote: post #469
ivan_gammel wrote: post #456

Earlier quoted context omitted.

It is not that simple too. Tools used for reasons outside of work may not always be perceived as good tools for work. And tools used professionally are not always considered to be good for use for personal reasons. If someone have met Slack for the first time at their job, they may recommend it at their next job, because they associate it with work - this conversion channel is pretty clear and established. But the co…

it's not that simple either: tools used for reasons outside of work may be perceived as good tools for work; and tools used professionally are sometimes considered to be good for use for personal reasons. tl;dr it doesn't need to be true always, only sometimes, which it is

Well, if I wasn't clear enough: the fact that someone have used a tool for personal reasons and may recommend it as a good tool for work is not enough to justify spending on those personal use cases. You need this to be a healthy conversion funnel and valuable brand awareness channel, otherwise you are wasting money. To make a call you need data from marketing research and I would assume that Slack marketing team knows more about it than HN crowd, simply because they are in position to have this data and HN crowd is not. It can be the case that they are not acting professionally, but I would not assume unprofessional behavior by default.

Re: Slack’s free plan change is causing an exodus

#625

Post by ghaff »

ryeights wrote: post #621
ghaff wrote: post #600

Earlier quoted context omitted.

>Here’s what companies don’t understand: if you promote your product through a loss leader — which is arguably how Slack became popular in the first place — changing your pricing at a later date will piss people off. I'd argue that most companies understand that perfectly well. They have a generous free tier to drive growth. Once that growth is attained and demand starts to level off, it's time to trim the resources…

Note that Heroku and Slack are both owned by Salesforce.

True. So the timing is probably not entirely coincidental.

Re: Slack’s free plan change is causing an exodus

#626

Post by webmobdev »

hnarn wrote: post #481
jmull wrote: post #163

People should understand this: A free tier is a loss-leader, intended to support sales of the paid product. If too many “…have been happily using Slack’s free plan for years”, then Slack will have to change the terms. Generally, storage and access to storage cost money. If you aren’t paying for it, it is definitely temporary, whether anyone says it explicitly or not. I don’t just mean in a “nothing lasts forever” way…

Everybody understands this. Here’s what companies don’t understand: if you promote your product through a loss leader — which is arguably how Slack became popular in the first place — changing your pricing at a later date will piss people off. You’re trying to put the blame on the consumer here which never makes any sense from a business perspective. If your loss-leading pricing strategy was unsustainable from the st…

Very true. Reminds me of what Seth Godin wrote on how the internet has changed people's behaviour:

> Most people, most of the time, don't buy things if there's a free substitute available. A hundred million people hear a pop song on the radio and less than 1 percent will buy a copy. Millions will walk by a painting in a museum, but very few have prints, posters or even inexpensive original art in their homes. (In the former case, the purchased music is better–quality and convenience–than the free version, in the latter, the print is merely more accessible, but the math is the same–lots of visits, not a lot of conversion).

> We don't hesitate to ask a consultant or doctor or writer for free advice, but often hesitate when it involves a payment. ("Oh, I'm not asking for consulting, I just wanted you to answer a question…") And yes, I'm told that some people cut their own hair instead of paying someone a few bucks to do it. The bet a creator makes, then, is that when she gives away something for free, it will be discovered, attract attention, spread and then, as we saw in radio in 1969, lead to some portion of the masses actually buying something. What's easy to overlook is that a leap is necessary for the last step to occur. As we've made it easier for ideas to spread digitally, we've actually amplified the gap between free and paid. It turns out that there's a huge cohort that's just not going to pay for anything if they can possibly avoid it.

> As the free-only cohort grows, people start to feel foolish when they pay for something when the free substitute is easily available and perhaps more convenient. Think about that–buying things now makes some people feel foolish. Few felt foolish buying a Creedence album in the 1970s. They felt good about it, not stupid. This new default to free means that people with something to sell are going to have to push ever harder to invent things that can't possibly have a free substitute.

> Creators don't have to like it, but free culture is here and it's getting more pervasive. The brutal economics of discovery combined with no marginal cost create a relentless path toward free, which deepens the gap. Going forward, many things that can be free, will be.

Source: The game theory of discovery and the birth of the free-gap - https://seths.blog/2011/06/discovery-free-145/

Re: Slack’s free plan change is causing an exodus

#627

Post by c256 »

parkingrift wrote: post #498
muppetman wrote: post #318

Earlier quoted context omitted.

My wife has 4 business slacks she's a part of. Because she's got the slack client open all day, she setup a little slack for just her and me to use. We use it during the day to plan things, talk etc etc. It's been great to be able to go back and looks at various conversations/details/bits that were often up to two years old. I don't think we were "freeloading" as such, the 4 business ones she uses are all paid. I'm a…

Its been great for you to use Slack and to be able to go back and view conversations from years ago. It’s so useful to you that you’ve used it for years, and you love it. …but you won’t pay $12/month for it? Yes, you are a freeloader. And you’ll inevitably keep bouncing from free app to free app as services mature and shift focus to making money. You, as a freeloader, are of no economic value to Slack, Discord, or wh…

> …but you won’t pay $12/month for it?

But it’s $24/month, isn’t it? Double that if they invited the kids, in-laws, or neighbors but they don’t use it regularly because those people don’t use Slack for business — which is the whole point of the loss-leader approach: get people used to using slack, get them in the app, and then get them to bring it into larger environments where corporate rates make sense.

This new policy degrades the value of slack significantly for a bunch of long-term, low-volume users. It will cause a few people to move to a paid plan, maybe, and it will certainly cause many to leave slack. The last part will make slack less sticky, less familiar, less generally used, and will save them some amount on storage, maybe? Have you priced out storage recently? I’d bet the cost difference for storage of short text snippets between 90-day rolling and 10k messages is: - Smaller than the variance of MTBF of different batches of disks - Smaller than the variance on overhead in block/page size for their underlying storage system - Smaller than the variance of employee number for their 90th percentile large customers In other words, they’re adding annoyance and losing users for peanuts.

Re: Slack’s free plan change is causing an exodus

#628

Post by webmobdev »

mstipetic wrote: post #516
hnarn wrote: post #481

Earlier quoted context omitted.

Everybody understands this. Here’s what companies don’t understand: if you promote your product through a loss leader — which is arguably how Slack became popular in the first place — changing your pricing at a later date will piss people off. You’re trying to put the blame on the consumer here which never makes any sense from a business perspective. If your loss-leading pricing strategy was unsustainable from the st…

I think this should be outlawed. So many industries destroyed by cheap vc money, and then trying to raise prices once everyone else is gone. You can lose money doing research all you want, but the moment you start interacting with the market there should be a time limit until you can get your unit economics to work, or get out.

I agree - "free" should be anti-competitive. Today it is incredibly hard for any startup to compete with the "free" products of BigTech. And that is why in this industry, getting acquired by them is the only really viable exit option available for many startups.

Re: Slack’s free plan change is causing an exodus

#629

Post by oblio »

hedora wrote: post #367
carom wrote: post #68

Earlier quoted context omitted.

I hate slack and chat in general being temporary at basically everywhere I have worked. So often a colleague will give you instructions on some process then the next time you need it, it's gone.

I thought the only selling point of slack was that your chat history was archived and searchable. Oh well. Time for the industry to move on.

Yes, it is a selling point.

If you're not paying, it's not a sale.

Re: Slack’s free plan change is causing an exodus

#630

Post by oblio »

immibis wrote: post #622
oblio wrote: post #615

Earlier quoted context omitted.

Exactly. I proposed SWIFT and people latched onto to it to criticize when it was just a detail. You put it better, just have any layer on top of IBANs. 0 need for crypto.

However, the API should also be able to support crypto payments, by getting a crypto address and then forwarding the request to e.g. a local instance of Metamask, instead of my bank. Perhaps if the user has multiple bank accounts linked, they would have to choose one, to avoid leaking to my bank that I'm making a crypto payment. Of course, a crypto transaction has a significantly lower chance of being compatible sinc…

I don't mind that. People should be allowed to shoot themselves in the foot with their favorite Dogecoin.
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