How to Price WordPress Plugins and Themes in 4 Simple Steps (+ 3 More Pricing Tips)

Hi! I’m Ben from Freemius. You know, there are many similarities
between modern cutting-edge WordPress developers who sell plugins or themes, and old-school shopkeepers, lawyers, and even farmers. For all these professions, creating great products or offering great services is a given but nailing down the correct price for your product or services can be the tipping point between a prosperous business and a business that struggles to stay afloat on the highly competitive WordPress market. How can you find the true value of your plugin or theme? how can you pinpoint the exact price
that would convince your potential audience that it’s worth the spend? In this video, I’ll share with you how to methodically find the best price for your WordPress product in 4 simple steps! Let’s plug-in! Before we get started, make sure you
subscribe to our YouTube channel for future videos. If you’re watching this directly on YouTube, you can click the alert icon for notifications about new releases. Step 1: research your product’s market and pricing range. All WordPress products are unique, but each of them can be categorized into a broader category like: eCommerce plugins, backup plugins,
or form plugins to name a few. The first thing you have to do is to figure out which category your product belongs to. After you’ve done that, research
competitor products in the same niche, analyze price ranges, and try to find the
average. Pay attention to the fact that selling from a marketplace versus selling from your own store is very different. Prices on marketplaces are typically much lower because you’re placed next to competing products. If you are planning to sell your product on a specific marketplace, Do your research on that marketplace first. A good place to start is our in-depth analysis of ThemeForest and CodeCanyon. If you’re going to sell from your own
website, compare it to similar products that are sold through their own websites. When finding an average price to your product’s niche market, it’s important not to only ask yourself the price at which you’re going to sell your product, but also how you’re going to sell it. I’m not going to get into all the details in
this video but basically you have 3 main options: premium only, freemium, and subscription-based or SaaS. We have some other great videos about all of those pricing models so check them out! Step 2: set the price according to your
product’s value. Now that you have categorized your product and have a general price range for it, you need to analyze its value to determine how much you should ask for it. Here are two important questions that you should ask yourself that can help you decide: Does the product save users’ time or money? If the answer is definitely yes, you should gravitate towards the higher price end. There is nothing more important to a user than saving time or money which are almost the same. Does the product have a unique feature that outcompetes in the market? If so, it means you can charge a higher price. Think of these two questions as a spectrum on which you can position your product. Use them to determine your product’s market value. Step 3: calculate your costs. Putting the right price tag is not only a matter of income but also a matter of expenses. Think about the time spent on
development, new releases, updates, testing, marketing, documentation, and support. A good better-driven business thinks not
only about how much money comes in but also about how much money or time goes out. After all, your profit is the difference between the two. I obviously don’t expect you to know exactly how much you’ll spend on the product since there are often unplanned development costs. But at least try to establish a cost forecast. from the most optimistic, through a neutral one, and down to a pessimistic forecast. You can use the market and pricing research to help you
determine a benchmark. This will help you run real-world simulations across different price points and calculate the best ones! Step 4: don’t sell yourself short. Be proud of what you build! Don’t try to attract customers by being the cheapest solution. This strategy is bad for business and will most likely be a magnet for the worst types of customers. Know your product’s real value
through in-depth research but also be confident that your product is really
worth people’s hard-earned cash. Ask for as much as you can based on
the confidence you have in the quality and value provided by your product. As well as the considerations of your target market. Here is something to get you started. If you’re mainly targeting customers in North America and Europe, the minimal price we recommend for selling plugins and themes is $29.99 per year. If you price it lower, your product may be automatically be perceived as low quality. That’s it! 4 simple steps to help you determine the ideal price for your WordPress product. Now I’d like to share with you 3 more useful pricing tips. The first is the magical number 9. We are all accustomed to seeing prices for products ending with the number 9. This is a very well-known trick from the analog world that has been used for many years. Studies have shown that prices with the number 9 at the end, outperform the sales of the closest rounded number by 24 percent. It is a simple use of shopper psychology so feel free to leverage it. The second tip is using a pricing plan decoy. Have you ever seen a WordPress product where the price for one of its plans didn’t make much sense? It might be not a coincidence
because those useless plans actually improve the sales of the most popular
plan just by being there. Last but not least – don’t be afraid to experiment with your pricing. Think of the best price for your product and test it. The worst thing that can happen is that
you learn something and amend the price accordingly. RatingWidget – the plugin created by Freemius’ CEO Vova Feldman, went through several pricing iterations. At first, all of its features were sold for the ridiculously low price of $1 per month, but the conversion rate was still only 1%. It took a while to realize that dividing features between a couple of different pricing plans ended up optimizing conversions for RatingWidget in a huge way! Now, the basic plan is offered monthly for $4.99, (remember that magic number?) a middle and most popular plan for $8.99, and a fully featured premium plan for $34.99. The golden path to highly converting
pricing was finally discovered! But it took a lot of trial and error and
I’m sure it can be improved with more experimentation. So that’s it for now! A quick reminder of the 4 simple steps for finding the right price for your WordPress product: Find your product’s market and research its price range, ask yourself: is my product truly unique or does it save time or money? Determine your product’s true value by answering these questions, then, calculate your costs and finally – don’t sell yourself short! The most important thing is to
focus on creating a truly valuable product that will change the world of WordPress in your own small or big way. It’s a great feeling to choose the right
price for your plugin or theme and then watch it grow and create a steady flow
of subscription-based income. If you liked this video and want more advice and best practices from the experts here at Freemius, be sure to subscribe to our channel. We also share in-depth analysis on useful topics for selling plugins and themes on our blog. Feel free to ask us any question in the comments below and if it’s a really good one, we might turn your question and our answer into a video. See you next time!

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