How much we decided to charge for our software
A couple of weeks ago I asked how much we should charge for our software. There were some really good responses in the comments, in particular Andy Brice's link to the Joel on Software forums (which I'm now devotedly following). My takeaway was:
- You can probably charge more than you think.
- You should ask your existing customers.
The post also included a poll, which came in with an almost perfectly linear relationship between price and the number of votes; the lower the price, the more people voted for it.
Since that post, I've emailed our existing customers and crunched the numbers. The results were pretty convincing -- our price point was too high. When we released version 1.3 of our software, we'd bundled in our webserver option and pushed the price up from $199 to $399. Almost every customer we asked felt that that had been a mistake. For many of them, the webserver wasn't of interest, so bundling it in wasn't useful. And the new price took us out of their impulse-buy range. So we're going back to the old model - $199 for the core product, $199 for the webserver.
We announced this on Tuesday, and sales have already ticked up.
Resolver Systems competition closing soon
Just a quick reminder to anyone who wants to enter the Resolver One Challenge -- the first round closes at midnight tonight, so there's only 9 hours left for you to submit your spreadsheet if you want to win the first round's $2,000 prize (and thus be entered for the overall $15,000 prize).
How much should I charge for my software?
Deciding how much you should charge for a piece of computer software is really really difficult. Even testing a given answer is hard. You can vary the price and watch your sales, but that can only tell you so much -- how do you control for other factors? You can look at your competitors, but who's to say they've made the right decision (if all the other software companies jumped off a cliff, would you jump too)? You can look at economic models, but in general they're great for pricing goods made of atoms but terrible for goods made of information.
All you can do is get as much data as you can, churn the numbers, and try to work o ut an answer. You fiddle with the price and do discounts, and see what happens. You talk to your existing customers and ask them how much people who haven't bought yet should pay. Or you ask the hundreds of brilliant people who read your blog :-)
So: what do you think? How much should we charge for Resolver One? Let me know in the poll below. I've not given "zero" as a response, but if you can think of a viable free software business model for us then you can post it in the comments. (Raising VC and then selling at an inflated price to Sun doesn't count :-)
[UPDATE] poll has expired
[UPDATE] Hello to visitors from reddit; I've added a link to the product information above so that you can see what software I'm talking about.
[UPDATE] An excellent link in the comments from Andy Brice (whose blog looks well worth reading). My takeaway: Don't try to compete on price alone. You can charge more than you think, and the best way to find out how much is to ask people, in particular your existing customers.
It was also great fun rereading this Joel Spolsky gem.
Money for spreadsheets
We've produced a lot of interesting spreadsheets in-house at Resolver Systems -- some of which I've blogged about here -- but we're really keen to see what everyone else is doing with Resolver One. So we're running a competition: every month for the next five months, we're asking people to send us interesting stuff that they've done with our product, and we'll give $2,000 to the author of the best one. After five months we'll give $15,000 to the author of "the best of the best".
It should be interesting to see what people send us :-)
Getting phpBB to accept Django sessions
phpBB is a fantastic bulletin board system. We use it at Resolver Systems for our forums, and it does a great job.
However, we're a Python shop, so we prefer to do our serious web development -- for example, the login system that allows our paying customers to download fully-featured unlocked versions of our software -- in Django.
We needed to have a single sign-on system for both parts of our website. Specifically, we wanted people to be able to log in using the Django authentication module, and then to be able to post on the forums without logging in again. This post is an overview of the code we used; I've had to extract it from various sources, so it might not be complete -- let me know in the comments if anything's missing.
Product management with Google AdWords
You can't rely on people's response to your advertising to manage your product -- but as one of many inputs, perhaps it could be valuable. Can part of the product management role be taken over by aggregating data from carefully-targeted Google AdWords campaigns?
Ironclad 0.7 released
Excellent news from my friend and colleague William -- he's released version 0.7 of our Ironclad project, a library that allows you to use the useful C extensions that have been written for CPython (Python's reference implementation) from within IronPython (Microsoft's version for .NET -- the version we use at Resolver Systems).
William has many caveats about how far there still is to go, but this new release is tantalisingly close to being ready for alpha testing. Huge chunks of numpy, the numerical Python library for doing difficult maths with large data sets, now work. This is fantastic stuff -- close enough that we're now seriously considering having it as an option (with an explicit note that it's not ready for production use) in the next release of Resolver One -- or at least the one after that.
[Update] The redoubtable Michael Foord, another friend and colleague, has written a much better and more detailed post about this release on the IronPython URLs blog.
Do one thing and do it well
It's all change at Resolver Systems.