Rethinking WordPress Product Pricing Models

Posted: August 11, 2022 Comments

I just fully rebuilt and relaunched OrganizeWP. I’m experimenting with the pricing model; licenses for updates and support will be sold for each major version, and they don’t expire. I’ve got some (many) thoughts on pricing WordPress products and (as I’ve come to accept as typical for me) my thoughts go against the grain a bit.

For better or worse, WordPress products have fully embraced subscription-based pricing models. It’s common practice now, and in plenty of business brain circles a deviation from automatic recurring charges is a fool’s errand. I beg to differ.

The problem is: WordPress products are not SaaS. I have to add the qualifier/disclaimer that some WordPress products are SaaS, sure, but let’s not split hairs here.

I’m here to argue that many (sincerely not all) WordPress products with a subscription based pricing model are stifling their own innovation. They’re also contributing to the changing tide in the WordPress ecosystem, for better or worse..

WordPress != service

Subscription-based pricing models work great for SaaS because the software is providing a service. Hosting, data processing, notification delivery, uptime, availability, etc. are all rolled into the service aspect.

WordPress is a different platform entirely. The entire reason for running a WordPress site is to be self sufficient and in control, to own the site. This is arguably the main advantage WordPress has over SaaS.

Why are the products in the WordPress space working against that by way of a subscription-based pricing model?

Subscriptions == sustainability?

The biggest argument for subscription-based pricing is that it’s the best (only?) way to build a sustainable business. I don’t buy it. Subscription-based pricing surely does help with growth projections, and the zombie subscriptions that blindly renew every year can add up, but is that really what provides sustainability?

For a long time software was sold as a product, not a subscription service. Giant corporations were built using this model, as were many of the software companies we have come to know and love.

Just about everything is focused on this recurring revenue model today though, why? Were the lack of subscriptions truly preventing the company from being sustainable? Or does a subscription model simply align with hustle culture and that’s what makes headlines? Is it just about revenue as a means of growth? Is that a bad thing in and of itself?

What are you subscribing to?

I mentioned with a SaaS it makes sense that you’re paying a recurring fee (usually monthly) for the service of the software. That makes sense to me. The software itself is providing a service, and you’re not dealing with any of the logistics of the software working.

Subscription boxes make sense to me. You pay the fee and while your subscription is active you receive the boxes (of food, crafts, what have you) and that makes sense to me.

Gym memberships make sense to me. You pay to access all of the equipment and amenities and when you’re done you just leave. No up front cost, no maintenance cost, no storage fee, nothing. Good to go.

I don’t see how that aligns with WordPress products in most cases. You’re hosting your own site, dealing with setting it up and maintaining it yourself. You buy products in the form of plugins/themes to do a job, but you’re still responsible for everything else.

You can absolutely argue that you’re receiving the service of updates and support to that plugin/theme, which is true, but the product itself is not a service.

The support is the service, really

Support, I would argue, is by far the reason so many WordPress products have adopted a subscription-based pricing model. The support burden for products in the WordPress space is hugely significant. It goes hand-in-hand with the self-sufficiency that comes with WordPress.

We run into problems when the platform relies on self-sufficiency but the customer is not self-sufficient. That burden is on WordPress and its position as a platform. It’s something many companies are working on solving, with varying degrees of success.

The WordPress ecosystem has been touting that WordPress the platform is “easy to use” and “can do anything” and there are infinite combinations of ways to do that out in the wild. Both of these things are true, but at this point unless the customer has technical proficiency and patience, support burdens will continue to be large.

WordPress the product is trying to combat this with many recent features and changes, chasing some very successful site builders that have made a name for themselves. But I think WordPress is a big enough thing where opinionated tools are going to find their fans. Much like building a Linux distribution, WordPress sites are going to have their own “flavor” by way of various Plugins that modify the WordPress experience.

Maybe I’m just waxing poetic with that stance, but a goal of WordPress has for a long time been to be the operating system for the Web. The Linux ecosystem seems to align with that really well from multiple angles in my opinion.

Further: I have to believe that in some cases the cost of providing support services can and should be offset by license sales which also contribute to development cost of the next major version which in turn generates more license sales, right?

Major versions as recurring revenue

I’ve just recently rebuilt and relaunched OrganizeWP, and I’ve gone with a different pricing model this time around. Instead of licenses automatically renewing annually until cancelled, licenses are sold for each major version of OrganizeWP and they do not expire.

I went with this pricing model for a few reasons:

  • OrganizeWP is an Admin-facing tool only
  • There’s no front end output
  • The feature set is (mostly) self contained
  • It’s a tool that either works or it doesn’t

OrganizeWP is very much a single purpose tool designed to facilitate a very specific set of actions.

This is unlike most WordPress products in the world.

Most WordPress products have front end output which in-and-of-itself will likely generate more of a support burden than anything else, simply because of the nature of WordPress. Most WordPress products can/do/need to interact with other WordPress products, which by nature involves maintenance cost over time.

Removing those two burdens alone has me thinking that OrganizeWP is a prime candidate for a more old school software pricing model in that licenses will be sold for each major version, with no automatic expiration.

I think of OrganizeWP in the same way I think about my tackle box full of fishing gear. I buy the tackle box and put my gear in it. If a hinge breaks I’ll reach out to the company and get a new one. The tackle box is going to do its thing and I’m going to use it like the tool it is.

At some point in the future the tackle box company is going to iterate on their design. When that happens I may find out about it and realize that the improvements made are useful enough to warrant me purchasing the new version. If the improvements don’t align with my usage of the tackle box, my current tackle box works just fine and I’ll stick with that.

I don’t want to pay a subscription for iterative improvements to my tackle box.

Subscription fatigue caused this

I understand that OrganizeWP is unique in many ways, and that subscription pricing models are quite literally the only way may WordPress products can exist today. But the idea that subscription-based models are the only way forward feels shortsighted to me, and despite my having built successful products on the backs of subscription models I feel like I was just going with the crowd in a very real way. There’s no way of telling whether past products would have stood the test of time without their subscription-based pricing models, but my gut says in many cases they would have.

WordPress has evolved into a very strange platform indeed. The ecosystem is in the thick of a transition phase, and everything is pointing to further strangeness in the form of big money having big influence. There’s a segment of WordPress user who is bothered by this, but I’m curious to see if that segment is big enough to be sustainable. In the same way buying local is more expensive I’m wondering if that inconvenience is worth it to enough people to accept alternative pricing models and generate sustainable businesses.

With OrganizeWP I’m taking a step to find out!

The pricing model for OrganizeWP may very well blow up right in my face. Despite my projecting that the support burden will be low, there is a very real pressure that exists to ensure that new major versions include features that both new and existing customers alike will agree is worth the price tag.

This, of course, assumes that OrganizeWP the product is a good candidate for a test like this. There’s a very good chance the product itself doesn’t fit well enough with enough people to be sustainable even with a subscription-based pricing model, but I’m going to leave it up to time to tell me that.

It’s not only WordPress that has jumped in the pool of subscription-based pricing models. It seems like everything is a subscription now. Further, even companies like Apple are going all in on recurring revenue by way of subscription services to media and fitness platforms. I personally am fatigued by it all and have focused on removing as many subscriptions from my life as possible. I don’t want to rent every single thing in my life forever with no discernible return, do you?

Burdens associated with a major version pricing model

The market may say that WordPress product customers have come to know, expect, and be comfortable with the subscription model. Selling major versions means that updates will be nothing more than maintenance releases and bug fixes, no new features.

New major versions will need to be pitched to existing customers and that feeling of getting features “for free” is gone with this pricing model. Customers may hate that, I’m not sure yet.

Further, planning features is going to take a lot more… planning. Many times with a subscription model you are able to have a nice cadence with iteration and new features and when they’re ready you can release. Segmenting to major versions is bundled in with that, but when it’s part of your business model it’s another layer of consideration that needs to be taken and reevaluated over time.

The flip side of that is considering whether a subscription-based pricing model can actually stifle a product over time. I’m still kicking this idea around but I might argue that having new major versions be feature-based instead of solely breaking-changes-based allows for more intentional planning in some ways. New features in new major versions (as opposed to new features primarily breaking backwards compatibility, for instance) are a huge selling point which is good for business, but also a good decision point for customers to retain their satisfaction.

All in all, my decision to use this ‘major version’ pricing model was in no small way inspired by products like Sendy. I’ve been using Sendy for years and a huge reason for that is because I didn’t want to pay monthly for a service that I didn’t greatly and fully rely on, and that I self-hosted to boot. I’m not huge into email marketing and I don’t live and breathe it like many product people. But I recognize its value and I needed something. Sendy has a major version pricing model and I sincerely like it because it fits in the same box that OrganizeWP does in many ways.

Further, as I mentioned: I’ve been using Sendy for years and have happily paid for new major versions because the feature set was worth it to me.

Is Sendy a headline-grabbing huge industry leader? No, I wouldn’t say so. Has Sendy proven that it can be sustainable with a major version pricing model? I haven’t talked with the team behind it, but as a happy customer I can whole-heartedly say yes! I’m hoping OrganizeWP can follow suit, and I’m excited to see whether or not that proves to be true.

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