Have you gone shopping lately? You might have noticed that prices are on the rise. It’s not just groceries, though. Products and services in the WordPress ecosystem are also getting more expensive.
Product makers have slowly but surely changed pricing models. Those can’t-miss lifetime plugin deals are getting harder to find. Subscription packages covering unlimited website usage are also biting the dust.
Some may see this as WordPress businesses growing up. Pricing models were experimental during the early days of the theme and plugin explosion. They’ve given way to what developers hope are more sustainable terms.
Still, consumers feel the pinch. Website owners with slim margins are paying more. Online shops with lots of commercial extensions are particularly vulnerable.
It’s a delicate balance for everyone. Product makers don’t want to chase away buyers. And website owners must watch their spending.
Yes, WordPress inflation is real. Let’s explore what goes into product pricing decisions with help from those in the know. Along the way, we’ll also talk about what it means for consumers.
The Process Behind Raising Prices
The decision to increase prices isn’t an easy one. Product makers need to consider several factors. And there’s still a risk – even if the logic is sound.
We put a call out to WordPress product makers to take us behind the scenes. A few brave souls answered:
Below, they share their thoughts and experiences regarding price hikes. Their answers have been edited for clarity.
The WP Minute: What contributing factors led to raising your prices?
Alan Fuller: Inflation, cost of living, need to pay support staff, desire to reduce the quantity of new customers ( = support) whilst maintaining revenue.
Rogier Lankhorst: There are several things we weigh when thinking about prices:
- what users are used to paying
- what our competitors are doing
- what we are offering
Cost has nothing to do with it. I think current market prices are between $39 and $69, depending on the niche.
If you have a very niche plugin/small market, prices need to be higher to make a living. If the market is very large (security, privacy, statistics – where we operate are all large markets), you have more scale/sales and can go lower and still get a good turnover. If the average market prices go up, users get used to that pricing level, and you can go along. If you’re dominating the market you can set the prices, if not, you can aim a bit lower.
We raised prices for Really Simple SSL & Security, Burst Statistics, and Complianz last year. Complianz from $49 to $59, the other two from $29 to $39.
Complianz is pretty dominant in the market. Combined with a rebuilt React interface, and some very important new features like TCF and consent mode v2, $49 had become too cheap. Especially if you compare it with cloud services, which are way more expensive. We decided there was room upwards. I think there still is.
Really Simple SSL had been at $29 for a long time. The release of a whole series of new security features, combined with the average plugin price in the market (much higher), led us to raise the price. This is also part of our change to Really Simple Security.
Burst Statistics is relatively new and started with a limited set of features. So, $29 seemed appropriate. With the addition of new features, we have increased the price to $39. I also think that these days, $29 is seen as low. So, you have to be careful not to brand yourself as a cheap, low-quality product.
TWPM: Before this, when was the last time you raised prices?
AF: 15 months ago.
RL: Originally, we started with Complianz at $39 in 2018 and raised to $49 in 2022. Really Simple SSL started at $25 in 2016, raised to $29 in 2019, and is now at $39.
TWPM: Did you have any concerns about charging more for your product?
AF: Yes, where the competitor price points were and whether the loss of new customers was greater than the increase in revenue.
RL: It is always a bit guesswork. It’s hard to do A/B testing with prices.
So yes, you’re always looking at sales after a change. But you have to compare on a month-to-month level. And it usually doesn’t affect sales in the long run. Users still tend to agree that the prices are reasonable.
TWPM: Have you had feedback from customers? If so, what sorts of things have they shared with you?
AF: I have an automatic trial cancellation survey and one of the options is that it costs too much. I have had a couple of responses. But I’ve had responses before, so not statistically able to confirm. I always follow up personally by asking what a reasonable price is. To date, no one ever has responded to that request.
RL: Current customers with subscriptions always keep the same subscription price. As long as they don’t cancel, nothing changes for them.
New customers usually don’t know the old price. So only existing customers who canceled experience the increase.
TWPM: Have you learned any lessons from the experience?
AF: I’m not sure I have specific learnings. To date, 3 months or so after increased prices, revenue like for like is down 2%. But that is too small to attribute to price changes.
Since my main plugin has been around 7 years, I have increased prices 5 times – mainly as new features were added. But we started with a way too low price. As a product developer, it is quite difficult to perceive what value your potential customers put on your product.
In general, I have noticed plugin prices seem far more expensive than a few years ago.
RL: I guess the lesson is you shouldn’t be afraid to raise prices. And you should stay in sync with the market.
The Impact on Website Owners, Agencies, and Freelancers
So, what’s the impact on those who own or build websites? Much depends on your needs. And maybe when you started using a product.
Price increases don’t always affect existing customers. So, if you purchased a plugin license a few years ago, you may be paying the same rate.
Newer websites – or those undergoing changes – might feel the pain. That includes web designers with a developer license. These licenses don’t cover as many sites as they used to. That may mean more costs passed on to clients.
Websites that require complex functionality could also be impacted. The odds of higher costs increase with each commercial plugin used.
Such increases will be tolerable to a point. However, some site owners will need to determine the value of what they’re paying for. They may cut products that aren’t crucial to their site’s mission.
Products that offer a solid return on investment (ROI) are in the best position. Site owners will stick with products that make them money.
Rising Costs Are Part of the Equation
You don’t need to be an economist to predict that prices will continue to rise. That’s just the way things work.
It also shouldn’t surprise us that some WordPress products were due for an increase. Many longtime products were built by developers – not marketers. Pricing models may not have been their strong point.
Consolidation is also a factor. Companies like Awesome Motive routinely acquire products from independent developers. They quickly adopt new pricing.
It can be a tough pill for consumers. However, higher prices could mean better products. The extra revenue provides a stable long-term foundation as well.
Taken together, this benefits everyone. So long as product makers continue to provide value. There’s no doubt consumers will be the ultimate judge of that.
Our thanks to Alan Fuller and Rogier Lankhorst for their participation in this article!
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