Reflection on a price increase

On December 14, 2016, my team and I pushed a significant change to our Easy Digital Downloads products: we increased the price on all extensions by 50-250%. Yes, you read that right: up to a 250% price increase on certain plugins. This change was done for a number of reasons, which I will get into shortly, and has resulted in a very interesting last three months. Since I have always been very open with my company’s financials, I would like to now share some reflections on the change that we made and to also share some of the aftermath of the change.

The backstory

Since the beginning of Easy Digital Downloads, and I imagine many products, customer support has always been our biggest challenge. Taking care of customers is hands down the most difficult job in the company. It is ripe with challenging problems to solve, long hours, relentless flows of new tickets, on-going conversations that spread not only over days but even weeks and months. Providing good and, when possible, great customer support is, to put it simply, exhausting.

There have been many times over the last 5-7 years where I thought to myself I’m sick of this; I just can’t keep taking care of these people, maybe I should quit. I have had those thoughts and every member of my team has had those thoughts. On one particular evening back in November, I was sitting on my couch doing my best to work through a not-abnormally sized support queue, and it hit me: this has to stop. This wasn’t the first time I (and many other members of the team) had spent insane hours working through support queues, nor was it the 50th time. Working late to help finish support requests is an every single day occurrence. It literally never stops. This time, however, I had had enough (fifty times too many) and decided it was finally time to take drastic measures to reduce support. I hopped into our Slack channel and told my team this and within a few minutes we’d made a decision: it was time to increase prices. It was past time, actually, but late is always better than never.

When a company is faced with an over burdensome support load, there are a number of ways that most companies look to address it:

  • Fix the bugs that cause problems to happen that then result in support tickets
  • Improve UX so customers better understand how to achieve certain results
  • Write more and better documentation
  • Hire more support team members
  • Move team members from non-support roles to support roles
  • Outsource support
  • Release fewer updates
  • Release more updates
  • Remove problematic features / products

All of these methods are 100% viable and our team has implemented all of them. There is, however, another method that people tend to gloss over or ignore, and it is perhaps one of the most effective of them all.

To lower your support load, all you need to do is have fewer customers.

It may seem like the opposite of what most companies want, after all customers are the people that make it possible for companies to pay their bills and their team members. Without customers, companies cease to exist.

The real answer to lowering support burdens is to have fewer but more valuable customers.

On that evening in November, my team and I decided it was time to try and drastically reduce our support burdens by dramatically raising prices, thus reducing the number of customers while simultaneously increasing the average value of customers. Theoretically this would allow us to keep our revenue about the same (which was just barely covering our monthly expenses) or, if all goes well, raise our revenue and lower the total number of support tickets we received each month.

That was the hope anyway.

The change

We threw a lot of numbers back and forth while discussing the possible changes we’d make to pricing. In the end we had several goals:

  • Raise the average customer value
  • Lower the number of customers, thus lowering the number of support requests
  • Keep overall revenue steady or raise it

Due to the sheer number of plugins sold through easydigitaldownloads.com, there were a lot of different price points. We sold plugins as low as $6 and as high as $149. Our primary plugins were priced at $29, $49, and $82, and just one was priced at $149.

As a general rule, we came up with the following guidelines on picking new plugin prices:

  • Plugins that power fundamental aspects of a store, such as licensing, multi-vendor marketplaces, subscriptions, etc, would be priced at the top tier of $199. These were previously priced between $82 and $149.
  • Plugins that are priced at $49 (mostly payment gateways) would be increased to $89.
  • Plugins priced at $29 (email marketing plugins and some other miscellaneous plugins) would be increased to $49.
  • Plugins priced between $12 and $19 would be increased to $29. This was determined to be the lowest price point we’d offer.
  • Bundles, such as the Core Extensions Bundle and the Digital Marketplace Bundle, would be increased according to the new value of the plugins included in the bundle.

In some cases, this resulted in plugins having $10 added to their price tag, and in others the increase was as much as $117.

The results

There are a number of statistics we can look at to help gauge the effectiveness of our price increase and we’ll go over those shortly, but there’s a non-scientific metric I want to look at first.

Team happiness and morale.

I do not need a psychology degree to tell you that the price increase has significantly affected the happiness and day-to-day mood of the team. For more than 12 months, our team has been faced with the problem that is Easy Digital Downloads. Yes, I mean that: the problem that is Easy Digital Downloads. You see, EDD is seen around the WordPress community as this great plugin that is wildly successful and a model to look up to in the commercial plugin ecosystem. While this is a reputation that we take great pride in, the honest truth of the matter is our team has struggled with EDD for months because in many ways it has felt like a sinking ship. We’ve seen stagnated revenue growth (even declines), higher-than-ever maintenance costs, relentless support queues, and a whole series of other challenges that our other two primary projects (RCP and AffWP) simply do not have. In comparison to EDD, those projects are cake walks.

The price increase has been enormously successful in making the team feel good, and the importance of that should never be ignored.

Support tickets

One of the primary results we needed to see in order for this change to be successful was a significant decrease in support tickets. It has now been three months since the price increase, so how’ve we done?

  • New tickets submitted: down 0.2%
  • Total tickets handled: down 43%
  • Total customers interacted with: down 35%
  • Conversations per day: down 42%

The total number of tickets submitted barely changed, but the other three statistics are incredibly significant. A 42% decrease in the number of tickets handled each day. That means EDD handled 10-15 fewer tickets every day, which translates to a considerable less amount of time spent working on tickets for our team. We have an average handling time of 5 min and 49 seconds per ticket, meaning we have removed one to one-and-a-half hours of support work per day by increasing prices.

Assume, for a moment, that we pay $25 per hour for support technicians. Removing 1.5 hours per day equates to approximately $37.50 in savings each day, or, when extrapolated out, approximately $13,687 per year in reduced support costs (if assuming zero volume change).

Revenue and sales

Along with a decrease in support burdens, we hoped the price increase would also provide a much needed boost to our monthly revenue. As mentioned in my 2016 in review post, Easy Digital Downloads operated at a loss for much of 2016, so increasing our revenue was an important measure on the success of the price increase. If we managed to decrease support and increase revenue, we’d consider it a home run.

To gauge the effect the price increase had on revenue, I decided to compare three different time periods:

  • January to February, 2016
  • August to September, 2016
  • January to February, 2017

These time periods are good representatives of our average revenue as they do not include any special promotional sale periods and they allow us to compare similar periods from before and after the price adjustments.

The summaries below provide a good overview of the revenue statistics for each of the time periods used for this comparison.

January to February, 2016:

  • Sales (including free): 3,861
  • Refunds processed: 106 – $8,765.40
  • NET revenue: $100,530.39
  • Average order value: $28.31
  • New paying customers: 664
  • Average value for new paying customers: $131.30

August to September, 2016:

  • Sales (including free): 3,930
  • Refunds processed: 74 – $4,454.95
  • NET revenue: $100,262.55
  • Average order value: $26.65
  • New paying customers: 565
  • Average value for new paying customers: $116.57

January to February, 2017:

  • Sales (including free): 3,009
  • Refunds processed: 65 – $7,530
  • NET revenue: $114,376.70
  • Average order value: $40.57
  • New paying customers: 373
  • Average value for new paying customers: $154.95

There are a few primary changes I’d like to highlight here. First, notice that the NET revenue increased by ~$14,000 in 2017 compared to the two 2016 time periods. With that NET increase, however, the total sale count decreased significantly, by more than 800 in fact. This also resulted in our average order value increasing from $28.31-26.65 to $40.57.

The total amounts refunded also possibly suggest that higher value customers are less likely to request a refund, perhaps because they do more ample research before committing than lower value customers.

This change also caused our average customer value (for brand new customers) to jump up to $154.95 from $131.30 and $116.57.

We are only part of the way through March, but the numbers are already looking even better than January and February. This is partly due to the promotional sale we ran for the end of winter, 2017. We shall see if the remainder of March and April hold up with the trend so far.

The price change has also had an interesting effect on commissions amounts that we pay to 3rd party vendors. In 2016, we paid an average of $16,000 per month to 3rd party extension authors. For February and January, this average has dropped to a little over $12,000 per month. While this is not an overly positive change for most extension vendors, it is a change that we see as an overall positive change for our company. This change primarily happened because of a decrease in the total sales, though it is also due in part to us reducing the number of 3rd party products we sell through the site. We have repeatedly learned just how difficult running a multi-vendor marketplace is and, as a company, we’ve determined that is not something included in our long term goals so we have continually worked to reduce the number of 3rd party vendors we directly work with. I hope to share more on various changes we’ve made over the years that have affected vendor commissions soon.

When combining the increase in revenue with the decrease in support burdens, this price change has so far appeared to be incredibly positive for us. It is a single move that might just be one of the most important changes we have ever made.

Customer response

Gauging the success of a price change based on customer reactions provides some really interesting insights. Using customer satisfaction as a metric, however, is something you must be careful with. In much the same way that star ratings tend to highlight the most unhappy and, oftentimes, unreasonable customers, the customer reactions to price changes typically show those customers that are the most unhappy. It’s unfortunately rare to hear from the happy customers or those that support your price change.

Within hours of pushing the price change live, we received our first reaction from a customer that who been considering a purchase during the time we were updating the prices:

Can you please confirm what is going on? How price jumped to the sky in a matter of seconds, I’m client of you and want to include multi-vendor option, it is even an effort to invest those 91 USD.

That reaction is fully reasonable, especially if he’d already added the items to the cart (our system could not account for already-in-cart items).

The second reaction we received:

Did the price of the Recurring Payments plugin really increase from $83.00 to $199.00 since January?? This was an unpleasant surprise. :/

Technically this was true, though with a brief explanation from Sean, her reaction completely turned around:

Awesome. Thanks for the explanation. I’ll look forward to exploring the features.

This customer did end up completing her purchase and has not contacted us since.

So within a few hours, we’d had two negative reactions but one of them turned into a positive experience for both parties. Over the next few weeks, we continued to receive emails from customers reacting to the price change. Many customers, interestingly, asked if the price increase was some kind of error.

Is there an error on your website or did your price in the last week just over double in cost? I was looking at making a purchase when I just did a refresh and saw the huge price increase.

We knew we’d get a decent amount of  flack for our price increase, especially as we chose not to alert customers (new or old) of the price increase before it happened. Whether this was the right choice or not, it was one we made intentionally. We felt there was a good chance that publicly mentioning our price increase before it happened would simply provide a place for people to pile negativity on us, and it would create a permanent record of that negativity for others to stumble upon. Doing it silently was like ripping the bandaid off in one fell swoop. It’s done, it hurts, but then it’s forgotten a short time later.

I still don’t know if doing it silently was the right choice, but there were numerous customers that were irate because of that particular decision. One person’s response was perhaps the most difficult to stomach. They started out perfectly reasonably:

I am in the process of renewing my plugin licenses again, everything looks good but I noticed that you’re now charging $199.00 (139.30 discounted) for Software Licensing? What is up with that?

I paid like $42 last year and certainly can’t afford to shell out $140 or more every year for a plugin. Not to mention the additional $40 every year for the other EDD plugins I’m using…

Please, tell me that a 200% price increase is some kind of mistake..

To that I gave a calm, collected, though perhaps too generic response, which really did not go over well, as can be seen by his reply:

Wow, so calm and collected.

Well, regardless of what YOU think about it:

1) It’s a 350% price increase (!!!)

2) It’s called gouging the customer

3) It’s called betraying all those people who got on board for 350% less, thinking that, even if the price increases, it will remain an affordable deal despite the annual renewals

4) You should grandfather existing customers at the original price instead of screwing them over

5) I expected much more from you, Pippin.

6) Maybe it’s time to create a similar competing plugin, sounds like it’s a very lucrative market, and would be much less expensive than getting screwed for a 350% price jack.

7) You won’t get away with it

8) It was a horrible decision

9) Even if I do renew this year, I’ll be looking for a complete replacement of the very overpriced EDD plugin suite that I have to keep paying for, over and over and over and over again.

10) Raising prices by 5%, 10%, or even 25% is reasonable. 350% is just greedy.

11) Do your current customers get 350% more value? Nope. They get the same old thing, only YOU benefit.

12) This list will be the outline of my next blog post

13) A textbook example of a bad move, how not to raise prices, and how to screw over your customers.

Seriously unbelievable move. I was all on board with you guys. Not anymore.

350% price jack = unbelievable gouging of your “valued” customers.

I could go on and on, but I’ll save it for the post.

I have had a fair share of people throw derogatory remarks my way, but this one was a bit different. This felt incredibly personal because it came from a person I’ve respected and looked up to for a long time. In fact, this response came from one of the very first people I looked up to in the WordPress community. Having them express their extreme displeasure at my decision to raise prices and method with which we chose to implement the change was painful.

It should be noted that we did grand father in all customers that had an active subscription (one that automatically renews). The only affected customers were those with manual renewals and new customers.

When you get these kind of reactions, it’s important to keep a fact in mind: companies do not need to justify their prices.

Perhaps the most telling thing from all of the reactions we received was just how horribly undervalued Easy Digital Downloads (and similar platforms) are in many customers’ minds. Here we had a customer that was seriously unhappy about paying $140 per year for plugins that provided the functionality they needed to operate their own store. Previously this customer had paid just $42 per year to run their store with EDD.

I’ve had friends, colleagues, and advisors tell me our prices have been too low for years, and I couldn’t agree more. It is absolutely crazy that we’re more accustomed as a society to pay $5 for a latte from Starbucks, which we will consume in a matter of minutes, than we are to pay $12-$20 per month for platforms that allow us to operate our businesses. We are accustomed to paying $80-$100 per year for subscriptions to Netflix and Hulu but we react with revulsion and disgust when a company asks for $150 per year to provide software that businesses literally rely on to bring in their own revenue. In the United States (where the customer above lives), we’re used to paying $50-$100 per month for cable TV subscriptions, but we expect software to be provided for so much less.

As a world, we are better at paying for things that rot (figuratively and literally) our insides than we are paying for things that help us provide for the health and wellbeing of our families and employees.

This disparity in pricing expectations is asinine. Unfortunately, huge companies like Apple and Google have perhaps single handedly helped to create this through the rock-bottom prices of their respective app stores. Between the 1980s and early 2000s, it was common for video games, which take hundreds of hours to create, to cost $40-$50. This price was normal and expected. Once the app stores rolled around, however, expected prices dropped so low that companies now get practically eviscerated if they try and charge just $10 for a full length game in the Android or iOS app stores.

Quote from a review of Super Mario Run:

With a £7.99 price tag, Super Mario Run certainly isn’t cheap, but it’s easily one of the best smartphone games around.

Isn’t cheap? Seriously? It’s roughly the cost of just two lattes or one-three pints from many pubs, both of which are gone within a matter of minutes.

It’s high past time software providers charge appropriately based on the value they provide. If we cannot even ask for a decent price, how can we possibly continue to build platforms that power the web and the world around us?

My final reply to the angry customer was lengthy and has served as a good sounding board as I worked through this reflection post. I ended with:

Perhaps our definition of “appropriate” is different, but the last time I checked, EDD provides me (with the ability to run my stores) far more value than any monthly TV subscription or coffee service. Would I pay $500-$1500 per year to operate the stores that provide for my family and employees?

Absolutely.

Perhaps it was my explanation of why we chose to increase prices so severely or perhaps it was the price disparities provided that convinced this customer, but they did end up sticking with us.

Thanks Pippin.

This makes sense, I understand where you are coming from.

I went ahead and upgraded. The renewal discount always is appreciated.

Thanks for the great response. Enjoyed it.

Going forward

At this point, we are very happy with how the price change has worked out for us and Easy Digital Downloads. We were happy enough, in fact, that we decided to implement a similar price increase on Restrict Content Pro and AffiliateWP, which went live on March 1, 2017, just a few weeks ago. We did end up making some adjustments to how we rolled out those price changes and so far the changes appear to have worked well. It is too early to tell just how effective they will be, but we are confident that it will prove to have been the right choice in 3-6 months.

Do you have thoughts or reactions? I’d love to engage with you in the comments.

157 thoughts so far

Have your say

  1. Andrei Olaru

    I have no problem with price increase, but IMO any preice increase should alo reflect in quality and frequency of updates for some extensions.

    ATM I’m testing WooCommerce in order to replace EDD. Their Vendors plugins has way more updates than FES.

    If FES will be better I would be happy to remain with EDD, but we’ll see.

    Thanks!

  2. Griffin

    Awesome work Pippin & team and thanks so much for sharing. Keep it up and you customer support is the best in the world in my opinion and well worth any price!

  3. Ray Gulick

    No question, price increases are going to create some pain and friction. But it’s not in EDD users best interests to have EDD go under. Sustainability is a big deal for businesses that use EDD, and it fundamentally rests on EDD’s sustainability. Thanks for creating and supporting a great suite of products to enable ecommerce.

  4. Miker

    Hello Pippin,

    No one is entitled to tell you how to run your business or price your products. However, I think you have missed an important way of reducing support cost, which by the way was implemented in the past since I am a customer for a few years: Support forum

    Large companies like Goggle and Microsoft pay less for support by letting customers help each other. These forums are very important because they also let you anticipate issues faced by others. However, at some point you decided to cancel the forum. You probably had valid reasons but you may want to rethink about it now. To me it was very useful.

    At the end of the day, if someone is going to start an online store with the aim of making 100K sales per year an upfront cost of $49 or $149 makes no difference but the problem is that people try many solutions and cost accumulates. I must say that I was lucky and I tried your solution (RCP) first which was OK for my limited business but it has ways to go to serve more complex settings. For example, allowing multiple subscriptions with different expiration. Looking forward to that. Right now I am using clumsy schemes to do that. You understand…

    In addition, the login redirect should be an integral part of RCP and not some different plugin in my opinion for all users. The more complete the solution, the more justifiable any increases. But the pricing is your business. This is a free market. But you may want to reconsider the forum.

    Good luck.

    • Pippin Williamson

      Thank you for the feedback!

      We actually had a public support forum for Easy Digital Downloads for nearly three years. It was closed down last year. Here’s a couple of blog posts about it:

      https://easydigitaldownloads.com/blog/changes-to-our-support-system/
      https://easydigitaldownloads.com/blog/retiring-old-support-forums/

      It may seem counter-intuitive to many, but our support costs (financially and mentally) actually decreased dramatically when we closed the forums.

      One of the best aspects of a support forum is the idea of community members helping others. Unfortunately, this isn’t really the norm. While this certainly happens, it’s actually far more rare than I think many realize. Mostly a support forum is managed by paid team members with a few occasional helpful community members that answer the odd question here and there.

      One of the downsides to a support forum is also the lack of control it gives a company over the support experience, which matters a very great deal. The moment a company leaves it up to community members to answer questions, that company’s reputation is also largely left up to those community members. Sometimes this works, sometimes it drastically hurts the company.

  5. intriguingnw

    Love your software, love your posts, and it was all too cheap before. People do not value products when they are too cheap, ask Apple – thats why they call it a value proposition 🙂 It is about value not cost and a brand is built by the customer loyalty that is maintained at a higher price than the sum of its inputs or parts. Look at Woo Extensions /Plugins are they cheap no, are they great and properly supported, robust and reliable and the choice of serious ECommerce folks yes. EDD is the leading brand for Downloads because it also the best. It might have been a pinch point with the silent launch but the value of what you folks do is indisputable. Heck actually I don’t want it to be too darn cheap, or the end customer thinks it is all darn too easy and it is not. Time you were earning more than chicken feed from it all. It makes me wince when I see people moaning about paying for premium plugins. Would they give away what they do for a living…KEEP GOING PIPPIN – you deserve it. Seeing Cid and Tony cash in on Sucuri with GoDaddy, good for them another great team of folks who deserve what they have built. 🙂 Shame it is GoDaddy though… Good luck all and THANK YOU PIPPIN again.

  6. Steven Gliebe

    I’m really glad you raised prices and flipped on auto-renew. I want EDD and those who make it to be in tip-top shape, long-term.

    Thanks for sharing how this has worked out for you so far. I am sure it will give others confidence to experiment with their own pricing.

  7. JAkzam

    It’s fine Pippin. You know we have to have EDD and all the frills to sell our plugins.

    Just don’t let it happen again.

    At least not for a year or so….AFTER we renew our subscription…then you can raise them again.

  8. Colin

    Thanks for taking the time to go into so much detail. The only issue I have is with not posting something like this BEFORE the changes, because the normal first reaction is to feel like one is being cheated. As this comments thread shows, most people who are your clients get it, and the ones who don’t are free to leave.

    The plugins you offer are certainly affordable, even after your rate hikes. I doubt anyone who is serious about what they’re doing would have thrown a tantrum if you explained it first, and that would likely have saved you some time in explaining it afterwards.

    I think Adobe and Netflix both got that right when they changed their business models, and for all of the complaining I don’t think much of it came from their important customers. There was a lot of noise, but it worked out alright for both of them.

    But all of that is irrelevant now. I hope this allows you to be a stable business for years to come.

    • Pippin Williamson

      Not announcing it is probably the one area I wish we’d done a bit different. That’s actually precisely why we decided to do exactly that with the RCP price increase. We emailed customers ahead of time. We did not, however, email AffiliateWP customers even though we increased its prices at the same time. Since we were making two price changes at the same time, it was an opportunity to do a real experiment and see which method worked better.

    • Klaas

      WP Rocket does this type of stuff WAY SMARTER!

  9. Tim Strifler

    I love your transparency with your business, Pippin. You’re a real inspiration in the WordPress world! I sell plugins and child themes for the Divi theme. I recently launched a new plugin, and rather than continue the same pricing model for plugins that the Divi niche is used to (unlimited sites, unlimited updates, for life) I took a leap of faith and adopted the same pricing model that you have for AffiliateWP (minus the addons). I got a decent amount of pushback from people, however I stuck to my guns and sales have more than exceeded my expectations. I completely agree that software is undervalued. But doing what you’re doing is a step in the right direction. 🙂

  10. Al

    One day your product cost X and the following day the product cost 2X or 3X. You added no value for the increase. It was the same product… nothing new… nothing better… just more expensive.

    I seem to recall a drug company doing something similar with their EpiPen device and everyone went postal. I bet you did as well.

    I don’t use your product… I don’t even know what EDD (in your context) does (as opposed to that other EDD product!) But I do know that given the the way you handled it… raising the price without providing added value… shows me a company that we would never do business with.

    Reputation, honesty, and integrity are everything in the software biz.

    You were not thinking about your customers… you were putting yourself first and you can get away with that for a while… but eventually a competitor will come along and put you out of business.

    Good biz decisions need to be win-win for both the company and the customer and so far you have not convinced me that your customers are getting any added benefit from your product at the new price vis a vis the old.

    You have only two intrinsic offerings to your business… the value of your product and your reputation. Maybe your product is as valuable at 3X as it is at X, but I noticed you never surveyed your customers about that.

    As for your reputation, well I think you trashed it.

    What if your ISP tripled their prices tomorrow with no notice and/or no value added?

    What if all the oil companies doubled the price for no reason and without even a press release?

    What if your insurance company doubled their rates… and offered no added coverages?

    You would trash-talk them… as I’m sure a lot of people will trash-talk you as well.

    Perception is reality… and for a seemingly smart guy you don’t seem to get it.

    Take what I say as just electrons on a screen, but I’ve been starting, running (sometimes into the ground!) and selling software companies for the past 30 years and as the commercial goes… I know a thing or two because I’ve seen a thing or two.

    I don’t know whom your advisors were but my guess is that none of them are over 30 nor had much in the way of formal business education and experience because no one with any biz creds would tell you to double or triple your price overnight without explanation and without added value (unless you were a virtual monopoly.)

    If I were your customer I’d be hunting for an alternative mainly because this kind of business decision makes you look like the kind of company we don’t want as a vendor or as a client. But that is us. Obviously others see you in a different light… and so there is the possibility that I’m totally wrong… I’m not in doubt about one thing… you need some better business advisors… someone who is not afraid to speak truth to power.

    • Pippin Williamson

      Hi Al,

      Thank you for your comment! I genuinely do appreciate your feedback! There are, however, some issues here that I do wish to address. Let me step through them for a moment.

      You added no value for the increase. It was the same product… nothing new… nothing better… just more expensive.

      Did we increase the price? Absolutely! We’ve already cleared established that fact. Did we, however, leave the product exactly as it was? No, I do not believe so, but what’s my word mean? Clearly it means little here so allow me to show you instead.

      First, our main blog and our development blog, are both quite active and clearly shows some of the more significant updates that have been released with substantial improvements over the last several months and years even: https://easydigitaldownloads.com/blog

      January 13, we released a major update to one of the primary add-ons with more than 69 major improvements.

      February 13 we released a major update with more than 75 improvements.

      On February 16 we released yet another beta (and the final release a few days later) version of one of our main add-ons.

      On February 22 we released a beta version to another of the primary add-ons that added more than 20 significant improvements.

      On March 21, just two days ago, we released a beta version to one of our anti-fraud add-ons with numerous significant improvements.

      Those are just some of the ones that we wrote complete blog posts about.

      Second, we employ several full time developers whose sole job is to write code that makes improvements to the software. Interested to see just how much activity is on the main Easy Digital Downloads project? Take a look here: https://github.com/easydigitaldownloads/easy-digital-downloads/pulse – Within the last week there were 10 bug reports / improvements completed with work from 5 different people. In the last month, there were 43 issues resolved from 10 different people. Oh, and that’s just the main Easy Digital Downloads plugin and does not include any of the more than 200 different other plugins the team also works on and makes available to customers.

      I don’t use your product… I don’t even know what EDD (in your context) does (as opposed to that other EDD product!)

      EDD is not a product you use nor even one you’re familiar with, yet somehow you innately know that we haven’t provided any additional value to the product? Let me share with you another URL that shows just how incorrect that assumption is: https://github.com/issues?page=18&q=is%3Aclosed+is%3Aissue+user%3Aeasydigitaldownloads+sort%3Aupdated-desc

      In case you do not care to read that, it clearly shows not 1, not 10, not even 100 different improvements and bug fixes made since December 14 (the day we raised prices). In fact, it shows 434 issues taken care of since December 14 across the EDD plugins.

      Just for fun, here’s the direct link to the changelog pages of several of our primary EDD plugins that shows precisely when updates were released:

      https://wordpress.org/plugins/easy-digital-downloads/changelog/
      https://easydigitaldownloads.com/downloads/software-licensing/changelog
      https://easydigitaldownloads.com/downloads/recurring-payments/changelog
      https://easydigitaldownloads.com/downloads/stripe-gateway/changelog
      https://easydigitaldownloads.com/downloads/frontend-submissions/changelog
      https://easydigitaldownloads.com/downloads/paypal-pro-express/changelog

      I would recommend you read them since clearly you’re a man that values improvements and open information, and being well advised on your words and actions.

      But I do know that given the the way you handled it… raising the price without providing added value… shows me a company that we would never do business with.

      Frankly, I wouldn’t do business with that company either. Good thing we did more than 430 unique improvements instead of none 😉 Oh, and for the record, we did over 2,250 improvements in 2016 alone.

      Take what I say as just electrons on a screen, but I’ve been starting, running (sometimes into the ground!) and selling software companies for the past 30 years and as the commercial goes… I know a thing or two because I’ve seen a thing or two.

      I will more than happily hear from anyone that is clearly educated on the topic they’re arguing for or against. Without being too blunt, however, it’s clear you’re not familiar with EDD nor any of the standard daily or monthly activity that occurs within the product’s ecosystem so I would kindly request that you refrain from making sweeping assumptions or generalizations about the product simply because you don’t approve of a particular news item about the product.

    • Al

      I understand your POV. But take a look at it from the customer’s POV. Tell me if I’m incorrect:

      On day 1 the product cost X. On day 2 that same exact product cost 2X or 3X. The product didn’t work better, it didn’t have any new features, and didn’t have a prettier interface. It was just more costly.

      If I’m correct in the above, if you were your own customer, what would your POV be?

      I did some research into your product and it seems to be well-received in the market. As one poster here said, I would not be surprised in your huge increase becomes an incentive for someone to come into your market-space and compete with you.

      We use as few non-open-source modules as possible because we want to guard clients and ourselves against the exact same thing you did… yearly increased license fees for little or no value added. We don’t want or need another “cable TV” company in our lives. (And at least when cable rates go up they usually add some channel no one wanted and spin it that way.)

      We don’t like the pay now and then pay forever model that the industry has gone to. We feel it is fraught with fraud and fakery… which I hate to say it, it pretty much what your company has done in our eyes (readers: YMMV.)

      When we need to buy a theme or plugin, we make sure that the product and company will NOT do exactly as your company did. People hate that sort of thing and no matter how you try to spin it, it never works. It always sounds like a ‘coverup’ for greed.

      You said you didn’t bother to explain the increase in advance because of anticipated bad publicity. What do you think you are going to get by the action you took. You seem to believe that you had a strong argument for the increase NOW, but that argument was not strong enough BEFORE the increase? You bought into the old adage that “Once we have ’em by the balls, their hearts and minds will soon follow?” Sorry, sir, it was a bad decision.

      As an aside to the issue we prefer one-off pricing… meaning that if we need support we pay for it. If we need the new upgrade we buy it. We look for companies that will do their best to support older versions, at least for a reasonable number of years or WP upgrades. We always look at the reputation of the company and the people running it. I can tell you of of several companies in the Mac world who put out what I call hostage-ware… they pop in code that checks for a major OS X release and then just shuts down basically holding the client captive and forcing them to renew their license.

      Of course, sometimes we have to hold our nose and do business with outfits that do not meet our standards of honesty and integrity.

      Instead of trying to spin this along the lines you have… and I’m sure many people will believe it, I think you would have a better shot at preserving your reputation by saying: “Hey guys… I think we $#@! this up, BIGLY.”

      If you want to double the cost of something give the customer at least 50% more value. Otherwise you come off looking like the Gordon Gekko. (You are probably too young to catch the reference… but you can look it up if you desire.)

      I’m curious. Did you ask any of your customer base how they felt about the new pricing before you pulled the trigger on it?

      You didn’t ask for this but I will volunteer it anyway… and feel free to ignore it… but it is a life lesson that anyone who owns a business either knows… or eventually finds out. You will as well.

      “I’ve learned that people will forget what you said, people will forget what you did, but people will never forget how you made them feel.” -Maya Angelou

    • Pippin

      As mentioned in replies to a few comments above (and previous page), I do feel that not notifying customers ahead of time was perhaps something we should have done differently.

      Instead of trying to spin this along the lines you have… and I’m sure many people will believe it, I think you would have a better shot at preserving your reputation by saying: “Hey guys… I think we $#@! this up, BIGLY.”

      I’m not spinning anything because we didn’t fuck up BIGLY, not even “smallly”. I’m entirely okay with some people feeling that we did, but it’s important we as a company and team do not feel that way. Our team is happier than perhaps they’ve ever been because this has permitted us to work with fewer but better customers.

      The nice thing about “reflections” is we get to look back on things we did and see what went well and what didn’t. From my perspective, I can tell you these changes have actually gone over incredibly well even when there are a few negative points that stick out.

    • Drew Jaynes

      > One day your product cost X and the following day the product cost 2X or 3X. You added no value for the increase.

      A lot of people have this perception that one day it was one price and the next day it was a much higher one.

      The problem with this thinking is that there’s no historical perspective. Sure, the price changed — in some cases dramatically — but it wasn’t one price one day and another price the next. It was one price for years and then one day the price changed. If you happened to have been a customer accustomed to the old pricing, this change was likely jarring, but it was long overdue and you probably knew it.

      That’s why you see a ton of comments from existing customers praising the decision. They’ve continued to realize improvements on the software that runs their stores and membership sites and affiliate program for years without seeing price increases. It was frankly inevitable and long overdue.

      This honestly is a case of you not having really any idea what you’re talking about.

  11. Ray Gulick

    “I understand your POV. But take a look at it from the customer’s POV. Tell me if I’m incorrect:”

    Al, maybe you should read the dozens of supportive and approving responses from actual EDD customers,rather than trying to imagine yourself speaking for us.

    • Al

      Yes Ray, if it is on the Internet it must be true. It is a well-understood maxim.

    • Pippin

      Nearly every one of the comments on this post is from a real EDD customer.

    • Ray Gulick

      Right. Interesting that the guy who claims to be educating all “us millenials” (for which we should be grateful) is not a customer, has never used EDD. People like that give boomers a bad name.

      Pippin, I’m glad the WP plugin market is maturing enough to make itself more sustainable. Last thing I need is for EDD to go away or quit supporting their products. Professional designers and developers get it. My success rests on yours and the success of other major plugins (eg, Gravity Forms, BackupBuddy, etc.).

      Thanks, and best of luck.

    • Pippin

      Thanks, Ray!

    • Alec Kinnear

      Hi Ray,

      I’m an EDD customer (one of the largest I would guess over the last 18 months) and I promise you I’m not at all happy to see the infrastructure which I’ve invested in up front, triple in price overnight. I’d say the feedback split is about 60/40. Pippin changing his business model compromises many of our long term plans. I had no issue with maintaining our customer licenses in perpetuity with the previous business model and developing further sites for customers.

      I have no idea at this point what Pippin will see fit to do with the business or the pricing.

      At the new prices, there was no real reason not to just go with the market leader (for whom there’s lots of less expensive third party extensions) if you don’t want to pay full retail. In business terms (not personally, Pippin’s a great guy, has done some great development work, wish him all the best), I feel betrayed.

      Coming into a market at a lower price point, disrupting the market and then turning on one’s customers like a crocodile is what Microsoft specialised (specialises?) in. Adobe did similar things. I didn’t expect that kind of a turn from Pippin. Blindsided me.

    • Ray Gulick

      If you’re a large user, Alec, you probably own the developer versions, which means you spread the cost across several users, no? If so, the cost increase per customer would be relatively minor.

      I’m not saying I or anyone else enjoys paying more. But if it’s a choice between buying cheap and watching software and support go down the tubes or paying more and allowing the company to take care of its customers (ie, you and me), I’d opt for the latter. If you’ve never had a plugin go away that you’ve built a site around, then you’ve been very lucky.

      It’s time that quality WP plugins claim their real value and create a more sustainable and stable plugin ecosystem. That’s worth more to my business than saving a few dollars which get passed along to my customers (and it’s worth more to them, also). It’s about paying a fair price for value received, and if the plugin developer can’t support the plugin (assuming competent business practices), that’s below fair value.

      I think it’s possible to overprice plugins. I just don’t think EDD has done that. We all agree some forewarning would have been a good idea, but would it have changed anything apart from shifting the sense of betrayal you feel to a bit earlier on the calendar?

    • Alec Kinnear

      Hi Ray,

      No, for us spreading licenses hasn’t worked that well. I’m the kind of idiot who donates $100 to open source projects and contributes to open source projects so we bought heavy up front, expecting to enjoy maintenance pricing going forward and wanting to contribute substantially to Pippin’s business well-being. Having the long term maintenance pricing triple is not cool for us however you cut, slice or dice it.

      Pippin had a lot of alternatives other than tripling prices.

      1. charge additional fees for support above and beyond normal support
      2. control costs more strictly (maybe wiping out/buying out the third party developers wasn’t the best choice)
      3. build a third party developer store like Apple’s where Pippin takes 30% of the juice and passes support on to the third party developers
      4. extend his market with aggressive marketing in the WooCommerce space, based on close to equal quality at much friendlier prices
      5. not force subscribe people (cable, mobile phone companies, student loans are bad enough without software developers trying to make their customers where mortgages to the grave)
      6. grandfather existing customers

      The new model will work, but it’s not democratising publishing. It’s more like creating an exclusive fan club.

      As his new prices are in line with WooCommerce prices, the rapid expansion of EDD may end for real this time. Why go with the product with far fewer third party extensions and developers (which are priced very competitively around WooCommerce if the main product is not)? Is the EDD core code and ecosystem really better than WooCommerce is the question. If not and the prices are roughly the same, why choose EDD?

      I would much rather have seen a really vibrant EDD ecosphere with third party developers, open extension store and huge community. That’s how it looked when we jumped aboard. I was happy to pay more than my share of the freight to make sure an ecommerce microclimate like that existed in the WordPress world. Alas, since we jumped aboard it’s been shutting down forums, locking out/buying out third party developers, wildcat price hikes.

    • Pippin

      I’d like to address these a bit.

      1. charge additional fees for support above and beyond normal support

      I could definitely be proven wrong, but I simply do not believe this model works at any kind of large scale.

      What’s one of the easiest ways to make an already-paying customer really unhappy? Demand they pay you more when they come to you with a question or problem. Every single company I’ve ever known to offer support-based pricing like that has discontinued it in favor of higher up-front costs. I don’t believe that’s a coincidence.

      By taking a higher up-front cost, you cover base sides: the company can provide continued support and the customer can be assured they will get support when it’s needed.

      2. control costs more strictly (maybe wiping out/buying out the third party developers wasn’t the best choice)

      You make it sound like we bullied extension authors into selling us their plugins. This is very, very far from the truth. Every plugin we’ve purchased was already abandoned by the author or the author was seeking a new owner.

      Also, purchasing those plugins has actually done two things:

      1. It has raised our monthly revenue because now it makes more sense for us to spend money, time, and effort promoting the plugins more.

      2. It has lowered our monthly expenses because we pay fewer commissions. We also pay fewer support costs on those extensions because we can better control the development, ensuring they run smoother.

      3. build a third party developer store like Apple’s where Pippin takes 30% of the juice and passes support on to the third party developers

      I applaud the idea of this but his is not even remotely an answer to unsustainable costs. Running a 3rd party marketplace is one of the number one reasons we’ve gone down this road. Frankly, if we had never run a 3rd party marketplace, we probably would never have had struggles that led us here. We’d have been profitable for years.

      Also this ignores the importance of branding and reputation. Do you know why we have such a strong reputation? It’s in part because we stand 100% behind every item we sell, whether we built it or only helped sell it. If a plugin is sold through our site, we help support it. Period. Perhaps you’ve had the gift of always getting great support, but frankly many company’s support (individuals and teams) is downright terrible.

      We made the decision early on that we would never allow another developer’s support quality to negatively affect our brand and reputation and that is a decision I’ve never regretted with even an ounce of my being.

      4. extend his market with aggressive marketing in the WooCommerce space, based on close to equal quality at much friendlier prices

      I could have done that. In fact I’ve had offers to buy out EDD that would have rapidly elevated EDD close to the WooCommerce scale.

      It’s important to recognize that not everyone wants to be the “big player”. Some people do not wish to even get close to the “big” player.

      I have many goals in life, and one of the primary goals that drives everything I do is being happy. Happiness is rarely proportional to how much marketshare one has.

      5. not force subscribe people (cable, mobile phone companies, student loans are bad enough without software developers trying to make their customers where mortgages to the grave)

      We have never force subscribed anyone to anything. Not even sure what that means unless you’re indicating I somehow made your credit card numbers magically hop onto the screen.

      6. grandfather existing customers

      We did. All customers who held an active subscription was locked into the old price forever.

      As with any subscription service/product, if a customer chooses to cancel their subscription, they relinquish all rights they may have to future price lock-ins.

    • Alec Kinnear

      Pippin: about force subscribing. Effectively you are force subscribing people. If I bought plugins (and you know I bought a lot of them), I should have the choice to renew every year at the prices at which I bought into the system. With your forced subscription model, I don’t.

      I buy a lot of software. If I left it all of it on subscription, often I would be paying for subscriptions I don’t want or use. When the software offers renewal on the same terms I signed up, I usually do. You don’t leave me that option. I don’t like it and I’d call it forced subscription. If you take the word forced away from me, I would replace it with the phrase extortion subscription.

      Forced renewal (one has to renew within the year to maintain one’s existing price level) would be more palatable. We do this ourselves with FV Player. We offer a 66% discount on new for continuous renewal and offer a 33% discount on new for occasional renewal (outside of the support and update windows). I’m going to

      ***

      While I appreciate your concern about your support levels, you are really shutting out a lot of developers here as most of us don’t need support. You do have an issue: your neediest clients are causing you issues with support. There are other solutions than tripling prices.

      For example, those who need remedial level support are offered those options, either as pay with you or sent on free or paid learning programs created by others. It’s not our job as WordPress plugin authors to educate or fix the site of everyone who ever picks up WordPress.

      With our video plugin, if we took on the task of teaching everyone who writes us all the intricacies of running a video business, we’d have to close our doors next week. Instead, we offer as much documentation as you do and a free support forum and suggestions to our customers about how to simplify their publishing ambitions to a level which matches their current expertise or where to go to get more training.

      Keeping documentation up to date and at the quality level we’d like is a real challenge. But the challenge of maintaining documentation is identical whether one has 2,000 customers or 2,000,000 customers.

      We also offer paid development support where for someone who just wants us it done and doesn’t want to spend more time learning about AWS or CSS, we do it for them. This actually increases satisfaction levels as no one is turned away without a working site. By taking money for the hands-on support (which doesn’t extend to bugs or normal support: based on my experience of our support and your support our support is about on a par), two things happen.

      1. The additional support load pays for itself.
      2. Those who should really do some more reading and legwork themselves, often do so.

      It makes me sad that you want less people to have access to your products due to support issues. On the contrary I’m thinking about selling our product for less money as I believe everyone should have the opportunity to have first rate video technology on his/her site.

      ***

      I think you had other choices here. The issue is not that your choices will be bad for you. The issue is that your choices are bad for the community and for the commercial open source movement. I think there’s a lot more to live for than personal happiness. Eradicating poverty, stopping war, diminishing nuclear risk, eliminating toxic chemicals in the food chain, cleaning the oceans and even democratising publishing seem higher ambitions than happiness. While tackling those big issues which face humanity, happiness very well smiler her way into all of our lives.

      Of course, this is a personal choice and I respect yours. You’ve done much in the past to create a better WordPress ecommerce and software environment and point a way to a sustainable commercial open source model which keeps the open source in the model. I understand the stresses of running a software business and/or a large agency. It’s not easy. I’m not sure it should be though. Perhaps our expectations of how pleasant and easy life should be are too high these days. As John Donne wrote, life “nasty, brutal and short”. Now it’s somewhat longer but a rich life and a life of service is never easy.

    • James Dalman

      @Alec

      You have some good input but I wanted to respond to a few thoughts, only because I believe it warrants further consideration.

      1) “I should have the choice to renew every year at the prices at which I bought into the system.”

      While I understand your view, do you have the same option with groceries, gasoline, internet, or other services? These products and services go up over time (sometimes while downsizing portions or benefits) due to inflation and other factors.

      Just because a bought a cheeseburger from McDonalds for a quarter in 1950 doesn’t mean I should be able to pay a quarter for a cheeseburger today. We have to consider that the cost of living and businesses expenses go up every year.

      2) “It makes me sad that you want less people to have access to your products due to support issues … I’m thinking about selling our product for less money as I believe everyone should have the opportunity to have first rate video technology on his/her site.”

      I respect your decision to want everyone to have first rate video, but as a business plan, this will likely be disastrous. Great businesses that thrive don’t try to get everyone as their customer. It’s better to have a smaller community of people paying premium prices and delivering stellar value, than have a large community at lower prices all demanding more. Of course if your goal is to be like Walmart, I get it.

      3) “The issue is that your choices are bad for the community and for the commercial open source movement. I think there’s a lot more to live for than personal happiness.”

      I agree that life is not all about personal happiness or what we want, but I believe we can serve greater causes than ourselves while still having personal happiness. Should Pippin – or any of us – give up life, health, and happiness for some unwritten code or ideal?

      Business decisions should not have to revolve around the open source movement and what is best for the community. Sometimes you have to look out for you and your team’s best interest first.

    • Alec Kinnear

      Hello James,

      You wrote:

      “I should have the choice to renew every year at the prices at which I bought into the system.” While I understand your view, do you have the same option with groceries, gasoline, internet, or other services? Just because a bought a cheeseburger from McDonalds for a quarter in 1950 doesn’t mean I should be able to pay a quarter for a cheeseburger today. We have to consider that the cost of living and businesses expenses go up every year.

      James, you’ve completely missed the point here. I paid up front my license fee already – what supposed to be the main fee buying into a licensed software system as opposed to SAAS. Yes, I expect to be able choose to continue to purchase updates and support on the terms under which I originally bought the software. If not, as a customer, I’ve been cheated.

      I’ve already pointed out, our team doesn’t use support much. The incremental costs are almost nothing. Pippin even agrees with me here about grandfathering, we only disagree about forced subscription (i.e. I think I should have the right to choose every year to renew at the original prices rather than having to leave Pippin an open credit line to charge my Paypal account whatever he wants automatically). I very well may not want to renew all of the extensions we’ve purchased. Indeed I’m annoyed Pippin for finding such a sophist way of cheating me out of my original purchase. I don’t think that’s his intention but it’s the result.

      I respect your decision to want everyone to have first rate video, but as a business plan, this will likely be disastrous. Great businesses that thrive don’t try to get everyone as their customer

      I don’t know about that James. Serving a wide audience seems to have worked out pretty well for Apple, Microsoft, Google and Facebook. Unlike most businesses, software has limited incremental costs depending on how one handles support.

      Leaving software behind, Henry Ford changed how automobiles were built, how manual workers were paid (for the better) and put automobiles into the hands of millions. How did he do this? By charging five times less and managing his support (i.e. production) costs better.

      I agree that life is not all about personal happiness or what we want, but I believe we can serve greater causes than ourselves while still having personal happiness. Should Pippin – or any of us – give up life, health, and happiness for some unwritten code or ideal?

      First, I didn’t say anything about Pippin giving up his quality of life or sacrificing his personal happiness or the well being of people close to him. You seem to be deliberately twisting my words again.

      What I did say is that personal happiness will often arrive while pursuing a higher goal. If hedonism and self-interest are as far as your philosophical horizons stretch, continue reading Ayn Rand and hanging out with like-minded people.

      To take this further, if everyone thought the way you did, life on earth would be hell. Those who believe in helping others and leaving the planet a better place are who make life worth living, whether as a nurse or an ecologist or a teacher. Surely you remember those teachers who really made a difference to you? Fortunately they thought differently about personal happiness, financial gain and contribution to society than you do.

      Pippin did $1.5 million in sales last year. From his frank and fascinating analysis of his progress, it’s apparent he needs more experience in business to successfully manage a business of this scale. This is not unusual. Different sizes of business require different management skills or learning new management and process management skills. Throwing on the brakes as he has to lower support stress is one way of handling the issue.

      My point (and that of Al or David or a few others) is that there were other methods – possibly better in the long term for his business and his customers – to handle the growth than tripling prices.

      My sincere apologies for the harsher tone. Hopefully I’ve been clear enough this time not to give you room to twist and distort my views and try to put words in my mouth.

    • James Dalman

      Alec,

      I’m taking your words as you have written them. If I misunderstood, then I apologize. Perhaps the communication is not clear. For example:

      ” …. I should have the choice to renew every year at the prices at which I bought into the system.”

      To me, this implies that if you paid $39 five years ago for a plugin, then you should only have to pay $39 each year you renew that plugin. I don’t agree with this and it’s why I responded the way I did.

      The reality is that software agreements and pricing changes all the time. I don’t know of many software companies who guarantee their terms or pricing will never change. I don’t see many companies who promise you will ALWAYS pay the same price year after year. This is utopian thinking.

      ————————-

      “….The issue is that your choices are bad for the community and for the commercial open source movement. I think there’s a lot more to live for than personal happiness.”

      Again, it sounds like to me, you are condemning Pippin for choosing personal happiness for him and his team, over the needs of the community and open source. You didn’t mention “that personal happiness will often arrive while pursuing a higher goal”.

      I made a general response to what you wrote and how I read it. Nothing more, nothing less.

      ————————-

      “To take this further, if everyone thought the way you did, life on earth would be hell …”

      That’s adorable! What do you know about me personally other than a few comments to a blog post? Do you know how much I’ve given to the WordPress community for years? Did you know the past three years of my life I’ve forgone a nice salary and benefits to teach and mentor military veterans for free? Before you jump to assumptions perhaps you should do some research.

      “… fortunately they thought differently about personal happiness, financial gain and contribution to society than you do.

      Fortunately I don’t follow what others tell me or think my life should be. I’m not perfect and have definitely made mistakes, but I sleep great at night because for the most part, I’ve lived my life right and helped hundreds of people.

      ————————-

      “Surely you remember those teachers who really made a difference to you?”

      Yes I do. The teachers who told me I would never make anything of my life made a HUGE difference. They gave me the fire to be very successful in life and business!!

      ————————-

      Don’t apologize for your harsh comments. They don’t bother me. They made me smile.

      I don’t have time to debate anymore or to continue a territorial pissing match. Life is way too short. I don’t agree with your comments and you don’t agree with mine. It’s all OK.

      Enjoy the rest of your weekend.

    • Pippin

      Alec,

      I don’t have the energy to respond to all of your points, but there is one thing you said I cannot leave alone.

      Unlike most businesses, software has limited incremental costs depending on how one handles support.

      If you believe for even a moment that software does not have on-going and extensive costs outside of support, you’re going to be sorely disappointed if you ever choose to release and maintain a software package of your own.

      Where do you think the full time development salaries for multiple developers goes? Into the wind? No, it goes into:

      – Introducing new features
      – Maintaining support for older features as the software and hardware around it evolves
      – Fixing bugs, those introduced by our own hands and the hands of others
      – Improving interfaces, features, and experiences
      – Accounting for changing legal requirements (ex. VAT taxes)

      Describing software as having “limited incremental costs” is an insult directly in the face of every developer and grossly misconstrues the huge amount of development time put into software. Unlike customer support, on-going development is often times invisible to most consumers, especially when it’s done exceptionally well, but it’s anything but inexpensive.

    • Al

      “Describing software as having “limited incremental costs” is an insult directly in the face of every developer and grossly misconstrues the huge amount of development time put into software.”

      I kinda, sorta, almost, pretty much agree.

      We know all about support because we wrote and maintain the JAYA123 online application: http://jaya123.com which is about 150,000 lines of PHP code. (Try the demo… no personal info needed.) We charge $250 a year for it.

      I will add this one comment to what Pippin said. Eventually you get the bugs out of the software and eventually you find the time to write ‘killer’ docs and a ‘killer’ FAQ such that you can refer your tickets to one or the other. That really helps keep costs and time down.

      I am surprised to hear Pippin say that a forum actually caused him more work than less. We’ve never run a forum but thought about it from time to time because we assumed it would save us time and dollars. But if it didn’t work for Pippin, it probably would not have worked for us either. (Also, we had/have way, way, way fewer users than Pippin… we are not even close to his base!)

      As a buyer and user of software I like user forums… I don’t think we’ve ever had a problem with any plugin or software that someone else didn’t have before us and which had not been answered in a forum. I can’t remember the last time I filled out a tix for some app we own or are subscribed to.

      As an aside, we are going to EOL JAYA123… as it has been out there for 13 years now, we made good $$ from our investment in it so many years ago… and we either need to re-write it… or end it. When we started we were a pioneer of SAAS but now the market is crowded with order-entry/invoicing, bookkeeping systems… which are better than ours. Our user base is down to a small number of die-hards, and we’ve given them a year to find a replacement. Maybe someone here would like JAYA123… we’d probably just give it away… but it is pretty dated as you will see from the demo if interested.

      Hey, can you have a plugin that is 200,000 lines of PHP code 🙂 If so, Pippin it is yours!!!

    • Alec Kinnear

      Hi Pippin,

      Thanks for your note.

      There is one thing you said I cannot leave alone: “Unlike most businesses, software has limited incremental costs depending on how one handles support.”

      If you believe for even a moment that software does not have on-going and extensive costs outside of support, you’re going to be sorely disappointed if you ever choose to release and maintain a software package of your own.

      Pippin do you know so little about your customers? We have had a pro video plugin on the market for five years which has been best of class for the last two years (FV Player vs JWPlayer vs Flowplayer HTML5 Player).

      So I already walk in your shoes.

      Describing software as having “limited incremental costs” is an insult directly in the face of every developer and grossly misconstrues the huge amount of development time put into software. Unlike customer support, on-going development is often times invisible to most consumers, especially when it’s done exceptionally well, but it’s anything but inexpensive.

      I know exactly what software development costs. Yet all of the items you enumerate are not incremental costs. Whether one has 5,0000 customers or 500,000 one must do all of the following:

      – Introduce new features
      – Maintain support for older features as the software and hardware around it evolves
      – Fix bugs, those introduced by our own hands and the hands of others
      – Improve interfaces, features, and experiences
      – Account for changing legal requirements (ex. VAT taxes)

      That you cannot make EDD pay on $700K year is more a testament to a process issue than an issue with pricing. You’ve admitted yourself that 2016 was a year of consolidation:

      1) retiring plugins
      2) buying out third party plugins
      3) building a more solid support structure

      Of course you didn’t have high margins in 2016. You were setting the stage for a future with higher sales, very high renewal rates and all the revenue going to your company. You’d seen plugins rebound with revenue given a bit of promotion. I don’t know why you think EDD would be an exception to that rule and to the synergy between the three plugins. What the future will bring is an interesting question.

      By tripling your prices, you’ve certainly made the WordPress online store/ecommerce market much more attractive to someone like Syed Balkhi of WPbeginner who never saw a market with exclusively high priced competitors he didn’t want to undercut (ie. his WPForms plugin to compete with Gravity Forms, Ninja Forms and Formidable Forms in an already well-served and overcrowded market). Had you kept your previous pricing, you would have enjoyed a semi-monopoly position for the foreseeable future with WooCommerce as the expensive option and EDD as the popular option.

      One winning hand would be to exceed WooCommerce code quality and functionality over a long period of time and take the entire market. Getting some of your existing customers to pat you on the back is not a win.
      You’re a very intelligent man and I expect you will see some of this yourself over time. But it will take certainly take time to play out. A third serious competitor has not even arrived in your market. But it will. Figures like Larry Ellison or Bill Gates or Steve Jobs (or even Mark Zuckerberg) mainly thought very big: marketshare in five years not maximisation of today’s profits. When they did act instead on the here and now, usually they regretted it.

    • Pippin

      I have no interest in a “monopoly” and would happily welcome someone like Syed to come in and join us in the game of eCommerce.

      I really do not, however, appreciate you coming to my blog and insulting my management. You don’t have to agree with how we’ve done things and I welcome the insightful discussions that have been had but you’ve crossed the line. You know little to nothing about the internals of my company beyond what I have shared publicly, so do not try and accuse me or anyone involved of poor management because some numbers don’t make sense to you. That puts you perfectly in the “petty asshole” seat and I would like to expect better of you.

      You cannot one moment say how much you respect me as a developer and a person and then insult my financial management skills the next without also knowing all of the details. Pick a side or I’ll happily allow your comments to go directly to spam.

    • Alec Kinnear

      Hi Pippin,

      I’m very sorry to have offended you. It’s the last thing I’d want. I certainly wouldn’t want to say anything about your financial management skills. I know nothing about them. When I mentioned budget numbers, I intended to speak more about process management and optimisation (to reduce support costs and stress without reducing support quality).

      We cannot be equally talented in all areas. To give you an analogy, I’m a much better writer than I am a musician. Both are arts. I’m a far better cyclist than I am a runner. Both are sports. I’m a far better strategist than an administrator. Both are a form of management. In my own company, I’ve gradually had to learn to hire to my weaknesses and play to my strengths. What we are best at is not even necessarily what we enjoy most.

      It’s an ongoing process for me as well. Huge respect to you for what you’ve achieved. You’ve set high standards for quality commercial WordPress code and documenting that code. It’s that you are a standard bearer which makes this decision on your part so important. Your decision will influence a whole generation of WordPress plugin creators. It will change our ecosphere.

      Even this discussion will be read and cited for years when people think about plugin pricing and WordPress business models.

      You’re right. I don’t know all the details so I defer to your better judgement. And once again, I’m deeply sorry to have offended you.

  12. Tom Whitaker

    Confession: I don’t use your products but I love to read what other business are doing to address their problems. Thanks for sharing. I did have one question though….

    If I’m reading this right, you raised prices in an attempt to reduce the amount of support requests you received but when that didn’t happen, you just reduced the the amount of tickets you responded to by 42%?

    • Pippin

      No, that’s not correct.

      The total number of tickets being submitted has not yet dropped dramatically, but the total number of tickets that we handle each day has dropped by 42%. This doesn’t mean we just stopped responding (we respond to every single ticket).

      What this number really means is that the number of tickets that stay active in our queue each day has dropped by 42%.

      A “handled ticket” is any ticket needing a reply, whether it was initially opened today or a month ago, that was replied to.

      For one reason or another, the price increase has made tickets get resolved faster so there are not as many clogging up the queues for new ticket submissions.

      I’ll admit it’s really interesting and not entirely logical, but the numbers don’t lie 🙂

    • John Parris

      I’m guessing that weeding out the “lower end” customers is the reason for less back and forth on tickets. We’ve *consistently* seen that the customers that spend the least amount of money require the most support.

  13. Ray Gulick

    Al, you’ve made your disrespect for others’ opinions very clear. Hard to learn something new when you live in an echo chamber.

    Fact is, many WP plugins that provide significant value have been priced unsustainably for years. Thankfully, EDD is setting an example and setting their prices at a fair, sustainable level, and it will likely enable them to continue supporting and improving their products.

    Maybe it prices out people doing websites for $500, but you have to pick the part of the market you want to serve,

    • Al

      Ray your failure to learn or to even appreciate the POV of others, especially those who are critical is a typical millennial attitude which those of us who are a bit older and more experienced have come to expect (I’m age 69 with 45 years in the software biz… started with Ross Perot’s EDS around 1975.)

      I gave you good advice which you should have just thanked me for and moved on, but you decided you wanted to express your ‘tude’ instead. Like I said above, no one forgets how you make them feel.

      I also own a book publishing company (adams-blake.com besides newmediacreate.com) and have learned over the years that criticism is MOST often a much better teacher than acceptance. People will tell you what they believe you want to hear. Critics are usually far more honest and you would do well to at least listen to them, validate them, and then, if you wish, ignore them.

      Yes, we do $600 (not $500) websites but not in WP… in Bootstrap and mostly to authors and publishers… which is a warm market for us … sites like this: kohanawolf.com. We don’t make a lot of money on them, but at least half of them come back to us a year or so later seeking a full-bore WP site which we normally charge from $1500 to $2000 for. The strategy has worked well for us.

      I’m sure there are customers of yours that do some websites at a similar low price point and your dismissive and arrogant judgement of them does not seem worthy of a company as admired as yours is. I don’t know what you do for your company but in my opinion you would be best advised to step aside and let Mr. Williamson be the point-man on this as he seems to have the disposition for open and cordial debate.

      I’ll give you one more piece of free advice that you are welcome to ignore: “People don’t care how much you know, until they know how much you care.”

      Raise your price as high as you like.

      As Jerry would say, “And good luck with all that.”

      I wish you well.

    • Ray Gulick

      Well, I’m 63, Al, so you’re intimation that you’re older and wiser falls flat. If you’re doing $600 websites, you’re a hobbyist, not a pro, and your opinions should be seen in that light, no matter how much you pontificate.

    • Alec Kinnear

      Hi Ray,

      Your disdainful comments about Al’s business made me curious. What’s he’s offering is pretty clever and could be very helpful to many small businesses.

      The sites are built with bootstrap and no WordPress.

      Is this WordPress

      No, it is not WordPress. We are using the well-known Bootstrap platform. Why? It is much faster for us to get a site up instead of having to install a large database and management system like WordPress.

      Monthly hosting costs are $7. You also have to pay for your domain.

      Where did you see safe hosting and maintenance for WordPress anything like that fee these days? The cheapest viable plans I know of are Flywheel at $15/month for just 5K visitors or SiteGround for about $10/month for 10K visitors. WPE starts at $49/month. Your site will probably break twice/year due to forced WordPress core updates (our BusinessPress plugin will help with that allowing you to stay on security upgrades only as long as you like and postpone site breaking major upgrades).

      In any case, the minimum price is $599 with options to spend more. The templates are not all out of date. The design is basic but very functional (this is from someone who builds only high end sites).

      The value in WordPress is for sites which do a lot of dynamic updating (weblog, complex stores). Otherwise let’s compare what Al offers small businesses vs WordPress on an annual basis:

      Domain: $15 vs $15
      Hosting: $84 vs $300 (average)
      Ongoing license fees for some of caching, slider, theme, SEO, video, contact form, no store: $0 vs $200 to $600 with new EDD
      Developer maintenance: $50 (could be zero) vs $200 (could be $500)

      Al: $599 up front and then $149/year
      WordPress: $1500 to $2500 up front and then $715 to $1415/year

      The WordPress up front costs are for offers similar to Al’s, not real high end as that’s would not be a fair comparison. With WordPress, the business owner does get blogging software (if s/he’ll use it, most don’t).

      Arguably the small business would not only be better served financially with Al’s solution, the small business would save a huge amount of time involved with maintenance and learning and downtime and security issues and choosing software in the WordPress category. For many small businesses, an extra $1000 means the business owner’s family can go go for a vacation or not. Or to have a website or not. Without Al’s services, the only choice these people have is Squarespace or Wix both of which give them no control over their site and facing monthly license fees forever.

      On the other hand with SquareSpace at $11/month for an info site with weblog and $17/month for that plus store, WordPress and EDD (or WooCommerce) are starting to look like a very poor financial choice.

      Again this makes me sad. But if we won’t offer what people want, we will force them to look elsewhere. Perhaps some of you remember the origins of WordPress. Moveable Type was the cool kid (and better engineered and far more secure with built-in caching) until Moveable Type introduced minimum $299/year fees for v3. The situation in the WordPress community seems very similar. We are setting ourselves up to be superseded. We should be making our money from new projects, not seeking to bleed our existing clients for all the blood we can. This isn’t just Pippin’s issue of course. Ten years later (i.e. now) core WordPress should competently handle security, contact forms, basic caching and basic SEO straight out of the box. It’s an embarrassment to us all that it doesn’t.

  14. Brett Atkin

    Pippin, maybe a follow up post about the cost to develop and maintain such a plugin would help people understand things a bit better. I find the accusations that your gouging customers annoying to say the least. I would suspect you have $100,000+ in development and that doesn’t count on-going maintenance, updates, support, marketing, payroll, etc…

    I think the people complaining have no flipp’n idea what it costs to do what you do.

    The people that don’t value what you’ve created likely aren’t in your target market…

    I have customers complain about $30 a month for hosting yet they’ll spend 3-4 times that each month in lattes or cable TV, etc. (as you pointed out). I also wonder how many of those complaining are doing so using their MacBooks (the pinnacle of price gouging – I’m typing this on a MBP FYI).

    If your customers can’t realize a positive ROI in the first month for what they pay for your plugins, I’m guessing it wouldn’t matter what your charge, their business still wouldn’t be a success.

    I generally only use paid plugins (Gravity Forms, The Events Calendar, Envira Galley, Slider Revolution, Soliloquy, Woo Extensions, WooThumbs, etc…) and paid themes (StudioPress and Divi) when I don’t use the Foundation framework for custom themes. I’m not only paying for the development time but also the expectation that if I need help, I get it. The other reason is I can’t create or couldn’t recreate the functionality in a reasonable amount of time. Take Gravity Forms, it probably saves me 75-100 hours of time throughout the year in form creation. That’s more than worth want I pay each year for the Developer license.

    You won’t do this, but I’d like to see you say, “If you don’t like, use something else.”

    • Pippin

      I’ve shared cost numbers in my year in review posts a few times. Last year, for example, it took $692,297.02 to develop, support, and maintain Easy Digital Downloads. That’s an all inclusive number, so contractors, vendor commissions, payroll, insurance, etc, is all included in that. Easy Digital Downloads made a total of $693,527.98 in revenue for 2016, leaving just $1,230.96 extra to “play” with.

  15. Brett Atkin

    I remember a post like that know that you mention it Pippin. Maybe starting with “I made $1,230.96 last year on EDD” would have made a difference in the push back. It is easy to understand that a 1% profit margin isn’t sustainable. The choice is become vastly more efficient and/or raise the price OR throw in the towel. I’m sure more than a few of your disgruntled customers would gladly pay more if the alternative was find a different solution.

  16. dxladner

    Pippin, did you ever think of small price increase but charge for support? In your article, it states “Would I pay $500-$1500 per year to operate the stores that provide for my family and employees? Absolutely!” But the problem is not every customers is the same. If I made 10,000 a month from the store I would easily pay you $500 a month for EDD. But if I only make 500 a month, how can I afford the same pricing structure??? Not all customers are the same.

    I totally understand when say ” I’m sick of this; I just can’t keep taking care of these people, maybe I should quit. I have had those thoughts and every member of my team has had those thoughts.” I have that thought every week. I also have the thought of “Why am I doing this”?? So I totally understand that side.

    And as someone also stated, “It is your business and you run it as you see fit” Totally believe in that. So your loyally customers will stay and the rest will go and now you will be left with what you wanted. I just hope it keeps EDD and all of your team in business for a long time to come, as your Impact on the WordPress Ecosystem has been incredible.!!!

    Thanks!!!

    • Pippin

      I’d be happy to be proven wrong, but I don’t believe support-based pricing will ever work at scale. The economics of it simply don’t work.

  17. DART Creations (@DARTCreations)

    Hey Pippin, I’ve read much of your posts, but first time I’m actually engaging.

    I can feel your pain, I really struggle to understand how people complain so much for the price of software – it’s like we’re on a gravy train, software development is very different from online courses, support eats away at profits.

    Was wondering, have you tried Support driven development? I think it’s a very effective way of eliminating / reducing support calls whilst give the development team much better insight to what customers are actually doing.

    Or maybe support calls were routine stuff which didn’t necessarily translate to bugs or real issues?

    • Pippin

      I’m not sure I know what you mean. Could you elaborate on support-driven development?

  18. E D

    Pippin,

    Would you consider doing a lower price brand but with no technical support what-so-ever? I’m a developer and just don’t need it so would happily pay less for a promise never to contact support!

    • Pippin

      No, I don’t think I would.

      There are a few downsides to it I see:

      1. It complicates the purchasing decision for customers. Perhaps one of the worst things a store owner can do is introduce too many choices during purchase (no, the irony of how many EDD has is not missed on me). The “tyranny of choice” is a problem.

      2. Many customers would opt for the no support option and then later realize they need support. When in a bind, one of the last things customers want to do (or product owners want customers to do) is feel burdened by another required purchase when all they’re trying to do is resolve the problem they’re experiencing.

      3. It’s a solution that benefits a very, very small minority of customers.

    • Ross McKay

      Realise that “support” costs include maintenance — updates for changes in WordPress, work-arounds for dumb things that themes do, fixing bugs that arise from new features and from new ways that people do things, and ensuring that security flaws are patched quickly. Even if you never submit a support ticket, you’re benefiting from fixes (and new features) from tickets raised by others. We all benefit from continued support and maintenance.

  19. Al

    I’ve followed the discussion all day… one of the more interesting ones of late.

    It looks like your current customer base is on board with you, and while people will often post what they think you want to hear, I have no reason to believe anyone here will be making a change right now, since they were grandfathered.

    However, you have given some of your customer-base a reason to shop around at renewal time. Of course they always had that option, but you have given them an impetus to exercise it.

    Beyond the developer license we have for Genesis and the Dynamik Web Builder, we try hard to stay away from buy-now and pay-forever plugins and themes. But we are different from many firms in that we have a lot of coding depth ourselves and it is not all that difficult for us to modify GPL code (I’m sure some of EDD is code from GPL modules.)

    And to be honest, we don’t even like plugins that much… we’ve all been through plugin hell. It happens time and time again where some plugin developer doesn’t know all that he or she should know and writes a function with the exact same name as another function in some other plugin written by another guy who is clueless… and you know the rest of that story.

    I was impressed that you prefixed your functions with “edd”:

    function edd_resend_purchase_receipt( $data ) {
    (line 40 of actions.php)

    We find it easier to support our own code when possible. We have a nice library of GPL code that we have modified and incorporate into the WP functions.php or other files. It would not work for everyone but it lets us sleep a bit better at night knowing that all our functions start with nmc_cmn (initials of our company forward and backward. I doubt any plugin writer will use the kind of a prefix!)

    As for shopping carts, we use Woo, but don’t like it much as it is poorly written code. We do our best to convince a client to forget about a plugin that will probably eventually break and use a stand-alone system… we tend to like ShopSite because it has been around a million years and has a solid business model.

    It will be interesting to see what your retention rate is over the entire year. And what will be more interesting is if your bottom-line increases to your expectations.

    With the exception of one guy with a bad attitude, you seem to have a pleasant, positive, and proactive customer-base. But everyone has a budget and perhaps some will find that dropping EDD and using something like Woo will increase THEIR bottom line… just as raising your prices has (or will) increase yours.

  20. towfiqi

    Sp you guys increased the price to 250% only to reduce half an our of support per day? Really? I am not seeing any improvement in your support. I have emailed about a security issue of EDD about months ago. Which is a very serious bug. I was assured that this will be fixed in near future. Which was not. I also opened a other few tickets in the past and in an average I received average response and “Not our fault” type of response.

    The worst decision you made for the users was when you ditched the support forum. In past, whenever we had issues with edd or the extensions, we could simply search the forum and gotten a solution real quick. But with this ticket system, We have to wait 24+ hours to get our issues fixed. Which is really frustrating to say the least.

    With this much price increase, you guys should make the Priority support forum open to all users who pay $$$ per year for the extensions..

    If not, I have to tell you are being greedy..sorry.

    • Pippin

      It should be noted that only 3 plugins were increased by that much. The majority of the plugins had a much, much lower increase.

      Regarding that security issue, that bug was fixed and emailed to you back on March 1. Here’s a screenshot to prove it: https://cloudup.com/ccqM6QVFjn2

      Perhaps our reply landed in your spam folder? I’ll follow up with you again now to make sure you got it.

  21. googlereu

    As we run a marketplace business (Elegant Marketplace). Your support has been great and, moving from WooCommerce (who don’t know what support means).
    EDD runs our business and has allowed us to grow exponentially.

    Software always seems expensive, it is just the way it is.

    People love free and with all the n’er do wells out there giving away stuff on the back of GPL, All premium providers need to protect their business, staff and core products.

    By raising prices, you are raising the bar on who your customers are – they are serious, they know that they have to invest to make their business grow and they will continue to support you, grandfathered in or not. – This is a Brave, considered and sensible decision.
    Keep up the good work. 🙂

  22. Corrado Izzo

    If you didn’t do it yet…Make a 80/20 analysis as well. You will see that 20% of your Customers do you 80% of your turnover and 80% of your Customers do you 20% of your turnover but…they are a pain, steal your time and many other not nice things.

    It’s the way it is.

    A price increase actually helps to get rid of a good portion of the 80% and that’s good for everyone involved.

    Keep up the great work
    Corrado Izzo

  23. David Schwarz

    Hello

    When a customer steps away from using EDD there is a chance they will step away from using WordPress. I think another poster mentioned Shopify as an alternative solution, there are also others of course.

    So not only does EDD lose a customer that perhaps they don’t mind to lose but theme authors and other plugin merchants also lose their customers or potential sales and perhaps they rely on those sales. I suppose that is their problem not yours.

    But of course, such increases may serve your business better but if all plugin authors were to do the same then you would end with a very elitist system in place.

    It is difficult to square the circle between WordPress which is open source and encourages private individuals to start their own websites and maybe try at a little online store and plugins that are available only to those who can afford them. $1,000 or even a few hundred bucks might not seem a lot of money to some of your posters on here but to a college kid it’s money they’re going to have to borrow.

    Maybe that college kid isn’t your target audience. Fine but where’s he/she going to go? He’s not going to WooCommerce because their pricing is comparable to yours now. So what to do? Answer: they leave the ecosystem. And the caching plugin author, the theme author, the forms builder and so on and so on all lose out not just this year but also next year and the next year …

    Al is correct (above poster) you only have 2 things. Your product and your reputation. What you have done is build your reputation on a FREE product (WordPress) you have given the community some FREE plugins over the years and you have a well priced, well coded product in EDD (and also your other products)

    What you have done is taken all that reputational collateral and trashed it. You have hiked your prices without fair warning and raised them through the roof. It looks like you have encouraged people along for the ride and then gouged them on price and pulled the ladder up behind you.

    YOu may not have wanted this to happen, it may not be your intentions which I’m sure are decent but perception is everything and to my mind you’ve just dented all that hard work. Then when you read this forum and you see customers present, past and future being told they are not wanted if they don’t have deep pockets and how they are a drain on your time and resources. Well I think you will get what you wish for in the end.

    In the UK there is a saying about ‘doing a Ratner’ and I think you may be close to achieving this, your belief that you have done nothing wrong and all the changes you have made will not be reversed is very admirable but it is helpful sometimes to be willing to change a direction if you are being told it’s not a good move. Did you try and survey your customers before and after the move? What did they say? I shouldn’t rely on feedback from comments on a blog post if I were you there is an echo chamber effect from such things.

    I have yet to understand why it is not possible for plugin or theme authors to sell their products in two ways. You can buy the plugin with support or without it. Create a 2 tier system. What is the objection to this? I have yet to see a single plugin author do this across the whole of WordPress? If you don’t make money from support and it’s just one big aggravation then offer a no support option. Simple, no?

    • Pippin

      If over this next year we discover that we screwed up and need to backtrack, that’s always an option. I do not believe that will happen but if it does, we’re not so self-centered to ignore it. In the end, we’re here for the long game and are willing to make the necessary changes to keep playing.

      Regarding support-based pricing, see my reply above for some of my takes on this model: https://pippinsplugins.com/reflection-on-a-price-increase/comment-page-2/#comment-764896

  24. Jackie D'Elia (@jdelia)

    As someone who owned a software company for 8 years, prior to the Internet, I find myself thinking back on why I sold my company. One reason. The model was unsustainable. Like you mentioned Pippin, I too was burned out and overwhelmed with the shear number of support requests. This was before email – so it was all on the phone – and sometimes using a program like Carbon Copy to take over a customer’s PC.

    Back then, there was a price war with another competitor that led to more customers for less dollars. I wish I would have had the courage at that time to do what you have done with EDD. Instead I sold my company to the competitor, and while it was a win for both of us – I often wonder what would have happened if I had stuck it out and raised my prices??

    While many folks here are complaining about the price increase – I wonder how they would have felt if you had chosen to just discontinue the product?

    What is the point of all of this – if it is not sustainable?

    With my own web design and development business now – I’ve made a conscious effort to choose a sustainable model. That means less clients – but more valuable ones – that I can serve in a way that makes me happy to come in to work everyday and excited about what I do.

    Finally I am an EDD customer – and I am going to renew because I want to be part of a sustainable community, one that thrives vs survives.

    Thank you for writing this post and reminding me about my own journey.

    • Pippin

      I’ve had several offers to buy my company over the last three years. I often wonder what would have happened had I accepted the offers. There are days that I wistfully think I should have, but more and more often in the last 12-18 months I remain resolved that I did exactly the right thing by not selling. There are a lot of challenges my team has faced recently and I’m supremely proud of them all for taking them head on and working through them. Some will read this and assume the decision to drastically raise our prices was an easy choice made glibly, when in reality it was probably one of the most tormenting changes I’ve ever signed off on for Easy Digital Downloads.

      I am resolute now that the following decisions will end up being some of the best I’ve made for our project:

      – Raising prices
      – Not selling the company
      – Reducing the focus on a 3rd party marketplace
      – Struggling through the burdens and challenges that some days made me want to walk away

      These decisions have all allowed us to more greatly focus on what we set out to build in the beginning: a great eCommerce platform for selling digital products with WordPress.

      Thank you for sharing your story, Jackie! And thank you for continuing to be a customer and an inspiration for us!

  25. James Dalman

    Pippin,

    As you know, I’ve stepped away from the WordPress community in general, but somehow I landed on this post and feel compelled to share my thoughts.

    I applaud you and your team for thinking about the future of your company, being sustainable for the long term, and reducing the ridiculous loads (and unrealistic expectations) of support. Screw what everyone else thinks, because at the end of the day, no one cares about you and your team’s well being like you do.

    As one who helped launched some of the very first premium WordPress products in the marketplace, so many customers expectations are unreasonable. They want everything for free or cheap and never consider the costs it takes to build products that make their lives easier or that helps them make money. For those of you complaining, have YOU ever created and brought a product into the marketplace and then supported it? Probably not. Check your responses.

    If greedy is taking care of the people on your team and ensuring your business is around in the future, then being greedy is a good thing. But I can assure you that Pippin is not greedy and a humble person. He’s been very generous with his time and money since I’ve known him. Pippin is being a smart business person.

    @AI – Your comments are ignorant and the fact that you are selling websites for no money and your work is outdated goes to show no one should take your advice seriously. You should spend more time working on YOUR business than spending hours telling someone how to run theirs, especially when they are VERY successful.

    Keep up the good work Pippin and team.

    • Al

      “@AI – Your comments are ignorant and the fact that you are selling websites for no money and your work is outdated goes to show no one should take your advice seriously. You should spend more time working on YOUR business than spending hours telling someone how to run theirs, especially when they are VERY successful.”

      And yet another member of this ‘community’ with an “it’s all about me” attitude. What exactly do you get from a post like the above? Are you trying to show how smart you are? Are you trying to show how successful you are? Are you trying to show how tough you are? Are you trying to show how creative you are?

      James, my friend. Making a post denigrating a colleague does none of the above. It just makes you look small and petty and somewhat foolish.

      I saw this on your website (which is quite nice BTW) and it kind of gave me a smile:

      “Let me be your branding and digital marketing sherpa.”

      Is this what you teach your clients to do… go out and beat up on someone else with the hope that everyone will think they are Mr. Terrific and sign up and pay them huge amounts of money? I ask because if it works, I’m going to go out and to the same thing!

      That was a pretty scathing review and roasting you gave me. I hope it made you feel better and if it did I’m glad. Guys with your personality type need to do this… it is part of your DNA or something. I’ve been in biz for 40-something years… I’ve seen it all… or at least most of it.

      Anyway your review above reminds me of the famous story told about Dorothy Parker (or attributed to her.) A newspaper editor had written and published a scathing review of her new book. She wrote a letter-to-the-editor saying:

      “Dear Editor. I am sitting in the smallest most cozy room of my house. I have your review in front of me. It shall soon be behind me.”

      My sentiments exactly.

    • James Dalman

      @AI

      My DNA is to be honest, straightforward, and not be afraid to defend others when it warrants it. This is what I did here — defend the decision that Pippin made for his company.

      It’s interesting that you feel you can publish your negative and condescending comments, yet no one is allowed to call you out about them without being seen as “having an attitude.” If you’re going to share your opinions, you need to be able to receive opinions back without getting butt-hurt. People disagree with me and tell me things I don’t want to hear, but that’s life and freedom of speech.

      Besides some of the thing you said to Pippin, the tone that you took towards millennials and younger people bothers me. Just because you have been in business 40 years and have age behind you, doesn’t make you an expert. I’m 46 years old and have seen a LOT of shit in my time, yet I’ve learned some of the best business/life lessons from people who were 18-27 years of age.

      Don’t you feel some of your own opinions were denigrating a colleague? Perhaps my response was harsher than needed, but sometimes a harsh word is needed. If I seemed petty or small, then it is what it is. I won’t lose sleep tonight for standing up for something I believe in.

      FWIW I don’t agree with Pippin on everything. He and I have had some big differences on beliefs and I’ve called him out and vice versa. Yet at the end of the day, I respect him and will have a beer with him. I’ll have a beer with you as well.

    • Alec Kinnear

      Hi James,

      While you may be taking Pippin’s side, your attacks on Al are personal, vulgar and completely out of place. You characterize Al as “condescending” and “negative”, going on to use language like “butt-hurt” and “lot of shit”.

      On the other hand, while Al disagrees with Pippin his language is always respectful and he discusses the business decision and not does not attack the man. Your interaction here has brought the discussion down two or three notches and is probably pushing Pippin to just shut it off.

      This is the most important business decision of Pippin’s life and affects the future of WordPress as a democratic platform (open to all). Why? Pippin is seen as a thought leader in our community. People admire his coding, his open communication, his past generosity and the success he has enjoyed with his business. Pippin creating a software gated community in software that in the past was kept on GitHub and to which he encouraged open contribution is a shocking shift.

      It’s important this discussion happens and your tone is doing everything possible to destroy it. I’m not one for censorship (at all) but I’d appreciate it if Pippin would remove the ad-hominem attacks, vulgar language, wild accusations from your posts. It’s Pippin’s site so he’s free to do as he likes of course. Secretly he may be happy to see the tone turn sour to give him an excuse to close the discussion. It would be early yet to do so as this news is still reverberating through the community.

    • James Dalman

      Hey Alec,

      Thanks for your input and taking time to respond.

      It’s interesting that you support freedom of speech yet encourage Pippin to shut down the comments or censor my “vulgar” responses. Which is it? It can’t be both. I

      If Pippin wants to delete my comments, he is free to do so, but if he does I do want to point out some things first.

      1. You call me out about vulgar language but Pippin himself said “I’m not spinning anything because we didn’t fuck up BIGLY, not even “smallly”. Are you going to ask him to police his own language or just mine?

      2. You said I made wild accusations? Can you show me where I did this? Everything I said is based on what AI said to Pippin. Now, I could have read his comments ALL wrong and it could be that I misinterpreted everything he said … and if I did, then I will be the first to apologize, but here is how I interpreted the comments (paraphrased):

      AI believes Pippin screwed up royally and should heed his 40 years of business advice. He doesn’t care about his customers, puts his own needs first, his reputation is trashed. He said “Reputation, honesty, and integrity are everything in the software biz.” which implies Pippin has none of these. AI said for a “seemingly smart guy, Pippin doesn’t get it.” He also goes on to question his advisors and talk as though 30 somethings can make good decisions. OH, and by the way, I DON’T even use your products.

      Can you tell me how this “language is always respectful and he discusses the business decision and not does not attack the man” as you said? When you question his integrity, character, and leadership it IS personal.

      The way I read it is that this man is talking down to Pippin as if he were a child. Again, I could be very wrong and will apologize if this isn’t the case, but you have to admit that the tone is condescending.

      3. I make no apologies for standing up for Pippin or others who constantly get based in the WordPress marketplace for trying to ensure their business is solid and profitable. The WordPress mindset is broken and I’ve watched many great people go out of business or suffer mental health issues because people in the community are ignorant about business.

      This is the real world will everything can’t be free or cheap. People invest their efforts, money, blood, sweat, and tears into building products that solve a problem. They have families and teams to feed. Yet some customers only focus on their selfish needs and get hateful or ugly when prices are increased or business strategies are changed.

      At the end of the day, it’s Pippin’s company and it’s easy for any of use to say what we would do when we’ve never walked in his or his team’s shoes. It’s OK to question the idea behind his strategies, but some of the comments question his ability and character which is not cool.

    • Pippin

      James,

      Appreciate the support!

      I don’t recall if you were at Pressnomics last year (was that before or after you stepped away from WordPress, I forget) but your comments about taking care of team, family, and self first are poignant and are very central to the why around many of the decisions made here. I’ve written on the subject (and spoke at Pressnomics on it) before: https://pippinsplugins.com/selfish/

      This latest decision is one of the final major changes to be made in order to protect our team, our products, and our longevity.

  26. Jim

    I’m a customer. I agree with your decision to increase the prices.

    However, I feel ambivalent about your reasons for taking that decision.

    What I feel would have been good reason is something like: “We’re raising prices because we have really high standards of support — the best in the industry — and it’s not sustainable to provide such high quality support at the current prices. We’re going to use the extra revenue to hire more support staff and maintain our super-high levels of support.”

    What I’m actually reading into what you’ve said: “We’re raising prices because we want fewer customers, and therefore less interaction with them and less time supporting them. We won’t lose money (even if we lose customers), because the difference will be made up by the price increase. And the fact that most of the customers we lose will be the ‘low quality’ customers is the best thing.”

    As a customer, I felt sad when I read this from you Pippin: ‘I’m sick of this; I just can’t keep taking care of these people, maybe I should quit. I have had those thoughts and every member of my team has had those thoughts.’

    It makes me feel like a bad person just for sending in a support request or a question or a bug report or even a suggestion. That I’m causing you and the staff harm. It just makes me sad.

    • John Teague

      I won’t speak for Pippin, but I don’t believe that you should feel that way. In our case, it was our commitment to service support combined with the needs and expectations of the base of our customers that led to our an overall unsustainable business model.

      In significantly adjusting our prices upward I sharpened the focus on providing great support but to those who could pay to make that model viable. It just happened that much of the loss was on the lowest tier that statistically required the most support time, by 60% or more.

      I don’t use “it’s not personal” because when humans interact it’s by definition “personal.” But, I struggled for months before I made the change precisely because I worried about how it would impact our customers and the business. I’m sure that was far from lost on Pippin.

    • Pippin Williamson

      Your good reasoning is actually much closer to what I really meant than your second interpretation.

      We have always held ourselves to very high standards for customer support. Our high standards are one of the primary reasons we are not well suited for running a 3rd party plugin marketplace: we are not okay with relinquishing quality in customer support by allowing vendors to provide their own support. When product sales are sold under our brand, we will always be the ones to support them in order to ensure customer support meets our standards.

      Thank you for sharing your thoughts!

  27. Goran Jakovljevic

    As a customer who purchased software licensing for 200$ a month ago and a plugin developer, I do agree with you.

    A year and couple of months ago, I decided to do “plugin a month” challenge, which at that moment sounded simple. Do one “premium quality” plugin each month for 12 months. After 4 months i decided to stop because support was increasing, and if you want to keep offering quality support, you need time, time that you are spending on full time job or with family. From 7000+ active installs across 4 plugins i have 69 5star ratings, none below that, because i really focus on giving great immediate support. BUT In order to keep giving free plugins with free support, you need sustainable model. One of the solution was to do premium version.

    So for one of mine popular plugins at that time, I decided to build premium version. After adding all features requested by customers, I figured out that i actually added to much stuff. And If I sell it for any real price, i would still be spending to much time on support and with that price it wouldnt be sustainable for long term. So I never published that plugin nor ever will. But I moved to the next one, learned from my mistakes and instead of adding lots of features, i focused on biggest ones and even decided to make it more pricey then the competition and keep offering quality support (they have cheap price but support is lacking) .Published it, used EDD and its been going great for past 2 months. After 5 sales, i used that money to buy software licensing plugin. Actually i never thought about its price, It didnt make any difference to me if it was 99 or 199 or even 299, i would purchase it in any case because it does bring value to my customers who in return earns me money.

    One funny fact is that paying customers can be more friendlier than customers that are using your free plugins.

    All in all, most of the plugins are really cheap, take a look at shopify, their plugins are paid monthly. So when someone says that yoast is expensive with 70$ premium, well shopify most popular seo plugin is 240$. Maybe we should do monthly subscription, maybe people are likely to pay monthly price then once a year.

    Good luck to you and your team in the future.

    btw. There is some bug here, if i log in and refresh, i get logged out, also wp.com tells me pass is wrong but i still get logged in.

    • Pippin Williamson

      Thank you for sharing your story and for using EDD 🙂

      Best of luck with your plugins!

  28. Al

    @Alec: Thank you for the kind defense. It is appreciated. I surely did not intend to have my remarks seen as a personal attack on Pippin. In my (somewhat calcified) mind my words were directed to his products (well coded) and his pricing policy.

    As for language, owning a book publishing company for thirty years and having made big(ly) money in non-fiction publishing before Al Gore invented the Internet (which killed-off the profits in the non-fiction sector) I was somewhat surprised at Pippin’s vulgarity as well as that of Mr. Dalman. But I find this to be more of a generational issue. Those far removed from my ancient age simply don’t interpret what I consider obscene as vulgar. I think it is is part of the dumbing-down of American culture, but from my continued activities in the publishing world ( http://bit.ly/1We4P7O) I know that that is very limited viewpoint and not shared by most (younger) people. I think there is a place for both sexual and scatalogical terminology in fiction, but I rarely see that need in a public screed or monograph, such as this board. My opinion… all are free to differ.

    As for Mr. Dalman’s pejorative postings and his critical attitude (I’m being kind here) it is wasted on me. I remember when I wrote my first book called ComputerMoney (http://bit.ly/2nTA2Ca) which started my little publishing company (http://adams-blake.com) I got a fair number of bad (scathing!) reviews in the media (this was 1991 before the net) and I was devastated. Some technology book reviewers said the price $29.99 was way to high (even for a mail-order book) and the quality was too low, and the writer was an idiot! Think of Mr. Dalman multiplied by ten or fifteen. My wife and I had put a lot of time an money into the project (ads in computer publications like Computer World and BYTE magazine, etc.) After reading the reviews we thought we were the stupidest people on the planet for spending so much money on a book ‘gamble.’ But then the 800 phone number started ringing… and sales came in… and in… and in… and after we sold/shipped 15,000 copies from our dinning room table over the next 18 months (do the math… that was bigly money in those days!) we learned a valuable lesson… one that was enunciated so well by the famous composer Jean Sibelius:

    “Pay no attention to what the critics say. A statue has never been erected in honor of a critic.”

    So at the end of the day, we learned (and I propose here to) let the Dalmans of the world be who they they are… and move on.

    @Drew Jaynes who said: “This honestly is a case of you not having really any idea what you’re talking about.”

    Actually I really do know what I’m talking about. I’m really not as stupid as most people (and my first, current, and very expensive wife of 35 years) think I am. But I won’t rehash the points I’ve made previously about Pippin’s new price policy to defend that statement. Either you get it or you don’t, and at both the beginning and the end of the day, it matters nothing to me if you do or don’t. Be free to be Dalman Jr. here if you wish. It’s quite all right.

    Getting back to Pippin’s new pricing, I agree with others who believe that it would have been a good idea to try fixing the process instead of raising the price so drastically. I well remember from the businesses courses I had when getting my MA from the College of William and Mary (1974) learning about price-theory, elasticity, supply/demand curves and marginal cost needing to approximate (or equal) marginal revenue. Of course most of that is theory, but there are practical applications that abound in the real world and I believe that had Pippin perhaps brought in a consultant with a strong biz and economics background that he would find a number of processes that could be tried (fixed?) before the drastic doubling of prices… which is sure to have an impact on sales.

    Mr. Dalman and others denigrate us for being in the ‘low end’ of the market; for doing sites for $600 (http://newmediacreate.com/lim/). He fails to see that these are simple Bootstrap sites, four or five screens that take about six or seven hours from first client contact to delivery (spread over two days or so.) Since rolling out our “Less is More” platform it has done well for us. There is demand out there for the low-end, and as I said earlier we often get these clients to upgrade to our higher-end (and more profitable) WP sites (http://newmediawebsitedesign.com/wp2/)

    There’s an old, wise saying: “Cater to the classes, dine with the masses; cater to the masses, dine with the classes.”

    YMMV

    • James Dalman

      AI,

      You keep talking about how my attitude is critical, yet you are being critical yourself. That’s extremely hypocritical.

      I also find it interesting that you really seem to be going out of your way to puff yourself up by insulting me more, talking about endless years of business experience and successes, linking to your books, using pithy quotes to make you sound smart, and talking down to younger generations and the dumbing down of America. Somebody needs a hug and affirmation.

      FWIW I wasn’t trying to denigrate you for selling $600 websites, but trying to say that one who is NOT making money (your words) with their services or products, they should not be giving business advice to someone who is making an incredible living. This would be like me giving golf advice to Tiger Woods without ever playing professional golf. If you’re happy with what you earn for your services, who am I to judge that?

      Additionally, I never said you were stupid. I think you have valuable experience and you sound educated. What I did say was that some of your comments were condescending and maybe ignorant. There’s a difference.

      It’s OK if you don’t like me and want to keep up with the insults. Knock yourself out.

    • Al

      @James

      You write:

      “I also find it interesting that you really seem to be going out of your way to puff yourself up by insulting me more, talking about endless years of business experience and successes, linking to your books, using pithy quotes to make you sound smart, and talking down to younger generations and the dumbing down of America. Somebody needs a hug and affirmation.”

      I don’t know what the purpose of your posts about me have to do with the subject of Pippin’s blog post. I don’t know what your fixation about me is all about.

      If you want to engage me, I’m easy to find. I suggest you do that in lieu of venting your dissatisfaction with me and my postings in this public forum.

      I will be happy to discuss with you any and all disagreements you have with me in private.

  29. conschneider

    As always, a post full of so many invaluable insights with a large hat tip towards transparency. 1001 thanks for writing this. Keep it up. You were 100% right in raising your prices like you did.

  30. David Grant

    I’m both a customer and a plugin developer, so I can see this from both perspectives.

    As a plugin developer (who sells premium addons using EDD to run my business), I really, really, really, REALLY feel your pain when it comes to customer support. I work into the wee hours almost every night answering the questions, support tickets, etc that come in over and over relentlessly. It’s exhausting, just like you describe.

    Customers really don’t understand what their requests cost us developers in time (and sleep and stress and even family life!). So, as a developer, I’m with you — I would gladly choose to have less customers and higher prices any day.

    Like many plugin developers I have both free and paid users, and I’ve found what others have said to be true: the less customers pay (including free), the more unhappy and harder to please they become. There is some messed up aspect of human psychology that when people get something for free or cheap, they get MAD if it’s not perfect in every detail, yet if they pay $100’s of dollars they suddenly become way more patient and understanding. It’s weird, but I’ve experienced it many times. As a developer, who would you rather deal with?

    Price is a great filtering mechanism.

    Now, as a customer of EDD, I do wish the plugins weren’t so expensive. For example, to spend $199 for one plugin *feels* like a lot of money. Logically I know the $199 will pay for itself many times over during the year, but it still *feels* like a lot. (I guess that’s where I get sucked in to the same perception the rest of society-at-large seems to have, which says $5 for a Starbucks is okay but $5 for an app is expensive… it’s hard not to.)

    But, in the end, I’m still a customer because I rely on EDD to run my business, and obviously the value these plugins provide is worth the price. The logical argument trumps the emotional one, and so I accept it.

    So, bottom line, as a developer I say “Go Pippin!” Raise those prices. It makes total sense.

    As a customer I say… EDD is not cheap, but it’s still worth it.

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