Lifetime pricing is underrated
from Hackers Incorporated Hosted by Ben Orenstein and Adam Wathan
Last summer, Tailwind UI moved from selling individual content packages and upsells to a one-time purchase, lifetime access pricing model. Since then, the business has doubled. Having seen this in action, Adam recently convinced his friends Sam and Ryan to try lifetime pricing for their product Build UI, and the results are starting to come in. In this episode, Adam and Ben dive deep into the world of lifetime pricing, why it's not something to be afraid of, and how it can be an absolute game-changer for the right type of business. Discuss this episode on Twitter → Timestamps (00:00) - Intro (00:14) - Why are we talking about this? (03:28) - Moving from package pricing to lifetime all-access pricing for Tailwind UI (06:03) - What about when you run out of new customers? (10:17) - "Everything You've Learned at MicroConf is Wrong" by Chad DeShon (13:33) - The myth of starting from zero every month (16:04) - Would Tailwind UI work as a subscription model? (18:09) - Characteristics of a lifetime-suitable product (20:50) - Subscription LTV vs. lifetime pricing (22:47) - Subscription friction and the death of the impulse purchase (25:42) - The brutality of churn in content businesses (27:21) - Why your lifetime price can actually be higher than your subscription LTV (29:01) - Ben's experience running Upcase at thoughtbot (32:42) - The hidden costs of the content treadmill (36:20) - Hitting a subscription plateau with Upcase (38:34) - Cookie Clicker game — how to make perceived value go up over time (42:31) - Why aspirational, impulsive purchases are more likely with lifetime deals (45:22) - Pricing decisions aren't forever (49:13) - Turning Build UI from a grind into an instant success by flipping the switch on pricing (54:17) - Using lifetime pricing to buy yourself flexibility and time to focus Links Adam on Twitter Ben on Twitter Tailwind UI all-access Everything You've Learned at MicroConf is Wrong, Chad DeShon's lighting talk at MicroConf Growth 2018 Build UI, Sam and Ryan's new UI training site that recently switched to lifetime pricing
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Chapters
- 0:00 Intro
- 0:14 Why are we talking about this?
- 3:28 Moving from package pricing to lifetime all-access pricing for Tailwind UI
- 6:03 What about when you run out of new customers?
- 10:17 "Everything You've Learned at MicroConf is Wrong" by Chad DeShon
- 13:33 The myth of starting from zero every month
- 16:04 Would Tailwind UI work as a subscription model?
- 18:09 Characteristics of a lifetime-suitable product
- 20:50 Subscription LTV vs. lifetime pricing
- 22:47 Subscription friction and the death of the impulse purchase
- 25:42 The brutality of churn in content businesses
- 27:21 Why your lifetime price can actually be higher than your subscription LTV
- 29:01 Ben's experience running Upcase at thoughtbot
- 32:42 The hidden costs of the content treadmill
- 36:20 Hitting a subscription plateau with Upcase
- 38:34 Cookie Clicker game — how to make perceived value go up over time
- 42:31 Why aspirational, impulsive purchases are more likely with lifetime deals
- 45:22 Pricing decisions aren't forever
- 49:13 Turning Build UI from a grind into an instant success by flipping the switch on pricing
- 54:17 Using lifetime pricing to buy yourself flexibility and time to focus
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