WordPress, code, design, business

WordPress theme and plugin pricing: “Unlimited” sites is unsustainable too

My previous article repeated what others have been saying lately and that is that providing “lifetime” updates and support for WordPress themes and plugins is unsustainable. It seems many providers are realizing this now and beginning to charge for renewal annually. But there’s one more hole to plug if WordPress product providers really want to say they have a sustainable model.

The unlimited license had to go because we saw abuse from group buying schemes and other nonsense that caused < 2% of our licenses to be responsible for over 30% of support tickets. This change hopes to mitigate that.Joost de Valk (Yoast)

Concern

The question asked earlier was, how can you really provide support and updates for the lifetime of your product? I think at this point, most in the WordPress community agree that the answer is, you can’t. Eventually it will catch up to you.

So my question now is, how can you really provide support and updates for unlimited sites? What is “unlimited” anyway? I won’t answer that since you have an imagination and if you’re a provider, you have data. The point is, you shouldn’t promise something you don’t know you can actually provide. Covering unlimited sites is not very different from covering support for lifetime.

A secondary concern I have is why should the customer with one site be covering the costs of the user with 10 sites? That is effectively what is happening right now. Prices should be lower for single site users and higher for multi-site users. And there should simply not be an “unlimited” option.

Solution

Several plugin authors are already limiting support and updates based on usage. For example, one site is a certain amount, five sites is more, and “unlimited” is even more. Wait, unlimited? Yes, most plugin authors who do base pricing on usage are still offering an unlimited option. They’re so close to having it truly sustainable.

This morning on Post Status I saw that Yoast changed their pricing so that their top tier is for 20 sites instead of unlimited sites. That puts them in the same room as WooThemes who limits support and updates for their WooCommerce extensions to 25 sites (formerly unlimited). If a user needs support for more sites, they can simply make another purchase. The only full-GPL theme provider I know of who limits support on a per site basis is Pro Theme Design. There are probably close to 200 theme shops.

It makes perfect sense to me to limit the number of sites you provide updates and support for. At churchthemes.com we’re going to take it to another level. We won’t do tiers. We will simply ask for an amount that covers support and updates for the site being made. If a freelancer has a second client, the same price will be paid again to cover that site.

Objections

I haven’t had much feedback on charging per site yet but I have some idea of what the objections might be.

  • The big shops aren’t doing it, so it must not work. In retrospect, copying WooThemes’ old model wasn’t the best thing after all, was it? Don’t copy something unless you know why it is done (give The End of the Ham a quick read).
  • Freelancers and agencies will leave me. Does your product makes them look good and make their work easier? If so, I think all but the very cheapest will gladly pay what amounts to a fraction of the total project cost (passed on to the client).
  • But, the GPL… Users can still use your theme or plugin on unlimited sites. They just won’t get automatic updates and support. That’s separate.
  • It’s not feasible. Plugin authors are already doing it. Ask the user to pay based on number of sites. Don’t provide support for more sites than they pay. Deliver automatic updates only the the paid for number of sites (see the Easy Digital Downloads Software Licensing extension).

Conclusion

Don’t offer what you can’t be sure you can actually provide. Cover all your bases when you price a product. Don’t gamble. Make sure you’ll be able to take care of your customers now and in the future.

I hope to report on the effectiveness of the churchthemes.com business model at some point in the future.

#blamelema

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16 Comments

  1. Hi Steve,

    Great points. I’m seeing a lot of desperate plugin developers offering Unlimited “Developer’s Licenses” (which means the buyer can upload and use it on all of their client’s web sites without ever paying a penny more to the developer), “lifetime support”, “lifetime upgrades” and all kinds of crazy promises, just to sell a few copies *right now*.

    And it comes back to hurt legitimate plugin companies like ours, who develop plugins with a very keen business sense, don’t over-promise or over-commit just to get the sale, and we charge for extended support after the initial free year of support & upgrades.

    And because we charge enough so we can stay in business, be successful so we can hire and pay enough support techs and developers and our marketing expenses, we sometimes get a black-eye for “charging too much” compared to say, oh, the plugins that are ridiculously cheap or free, because they aren’t planning to support their product much, and have no regard for tech support or develop costs because they don’t plan on staying in business for too long.

    Happy to see someone talk good business sense for a change :-)

    Cheers!

    – Ravi Jayagopal

  2. If you restrict automatic updates to one site, a lot of people will simple copy the code from that one site to their other sites. Many will simply continue using an outdated version, and if it gets exploited, you will have a potential image problem and sales opportunity to deal with. Maybe a sufficient number of people will pay for separate subscriptions on every site that uses your plugin, but this becomes an expensive annoyance for them to maintain. I think you really end up having to offer an “unlimited sites” or “developer” subscription with an annual incentive to re-subscribe. Brave New Code has done this very well.

    • Few people feel the need to do things the hard way when the price of convenience is fair. For example, the convenience of one-click updates and support is probably worth $25/year for a church. We’re off to a strong start with churchthemes.com and the customers know before they buy that support and updates are offered for one theme on one website for one year.

      Regardless of model, a security issue should be handled the same way. All customers should be notified and a patch provided at no cost. With churchthemes.com, all users can download the latest theme files from their account regardless of their renewal status for automatic updates and support. Our functionality plugin is free with automatic updates coming straight from the wordpress.org repository.

      I like that Brave New Code limits their largest package to a certain number of sites. They’re covering their costs by not offering “unlimited”. Different theme and plugins providers will have different packages and pricing but the bottom line is that they need to do what is necessary to be there for their customers in the future and offering “unlimited” or “lifetime” puts them at risk. Ongoing development costs money and so does support. Both need to be covered by appropriate pricing.

      • A lot of people actually will do it the “hard way” because the first world “price of convenience” really is prohibitive for them. That’s why there are third world “pirated” commercial GPL software markets. It might not be an issue for a niche like church themes, but suppose it was — even if you knew a huge percentage of the total number of sites using your code never paid you anything, they’re actually not violating the GPL in letter or spirit, and there’s no way they’d ever pay anyway. All that really matters is whether those who can pay — your real target customers — do in fact pay and there are enough of them to make the kind of profit you want.

        Here’s the real question: How much of this core audience is only willing to pay what you ask because you make it inconvenient for them to use a plugin or theme on more than X number of sites? My guess is the only people who think this way are those making a lot of money with a lot of sites, and the exceptions are outliers similar to the third world “pirates.”

        I must have misremembered BNC’s policy; I haven’t looked at them in quite a while but have kept a license active with them for several years despite never having used it. It looks like they now have licenses limited by sites for every wp-touch package they sell. To their credit they make it pretty clear they are selling licenses for support and updates to a limited number of sites. The usual approach is to try to make customers think they are buying a proprietary software product that it is “illegal” to redistribute and reuse freely. Creating inconveniences, pressing customers into automatic recurring payment schedules by default, and trying to spin GPL software as quasi-proprietary are all really problematic moves that position some theme and plugin vendors as adversaries hostile to their customers and the GPL.

        If you don’t like how the GPL cramps your business model that’s understandable, but the solution then is to build your business around a non-GPL platform. One thing that’s really attractive about CMSes like Expression Engine and Statamic is that they made this choice.

        • Some theme providers (fewer now than in the past) use a split license where PHP is GPL and CSS, images, etc. are proprietary. ThemeForest does this in order to [try] and limit usage to one site (though they give authors a full GPL option as well). It’s perfectly legal, although you’ll lose the approval of some important WordPress people because they have a differing opinion on what’s best.

          My view is that if you want to run a sustainable WordPress business you should license fully under the GPL in order to honor the wishes of those behind WordPress and at the same time set limitations not on usage but on optional services (ie. support and one-click updates) that have nothing to do with the theme or plugin usage license. This is a good way to do things and fortunately it is the way things are heading as the commercial WordPress market matures.

          A shop should also state that their products are full GPL and they should state that support, updates, etc. is limited and optionally renewable. These details shouldn’t be obscure (not a fan of asterisks and tiny footer text). We point this out on our pricing page, theme pages and checkout page. I’m not a fan of automatic renewal because I think it’s better for the customer to receive an early notification and make their decision at that time. Couple this with simply asking customers to purchase according to their usage and I believe you have a sustainable, transparent and ethical WordPress-based business.

          • Did ThemeForest quit the split licensing? I’ve forgotten how that played out. That’s how Joomla let things go. I rather like Matt’s position on it, however.

            I think you are right about all that. Yes the early renewal option with a discount, typically between Thanksgiving and Christmas, is a great model.

          • ThemeForest still does split licensing. I’m not sure how many authors are using the full GPL option. I’m guessing it’s a minority. Just ran across this: http://www.premiumwp.com/100-gpl-theme-forest-authors-dont-really-care-for-it/

            It’s not so easy to switch an old theme to full GPL though. My Risen theme on ThemeForest has non-GPL compatible elements so I can’t switch it to full GPL without taking things away (backgrounds, for example) from thousands of current customers that are already using them.

            MOJO Themes did go full GPL though and I think they shed quite a few themes in the process. Now they have the favor of the WordPress Foundation. Sometimes their banner is shown (presumably for free?) along with Creative Market on the wordpress.org homepage under “Premium Themes – 100% GPL”. That’s some serious exposure.

  3. Second thoughts on this in practice….In the last few days I’ve tried out Plain’s Barley and Brave New Code’s wp-touch and found them both really HARD to use due to the licensing locking to one domain — and not subdomains. With Barley you can easily change your registered domain on their site, although I got hung up needing to re-submit the license code on my end sometimes. With BNC I see no way to change the site you register with. Using a staging system makes it all the worse. It seems like buying less than the “unlimited” option means you will be paying extra in frustration.

    • Do the plugins still function without an active license? Did they help when you asked? They might like to hear your feedback on their licensing models.

      I don’t know how they handle things but what we do is give the user the ability to deactivate a license from their admin area. This frees it up to be used elsewhere. That way they can move the automatic update service to their production site when it goes live (some opt not to activate it while developing in the first place).

      The theme is full GPL and functions normally even without an active license for automatic updates.

      • Barley actually broke/degraded ungracefully without an active license, but that was due to a bug they are fixing. I asked a lot of questions, gave feedback, and they fielded it all very well. BNC took a while to respond but manually cleared out the domain associated with a license I’m not using on that domain. I suggested they look at the Plain/Barley interface as a good one for this type of thing. Your model is probably the simplest way to do it.

        I think if this model becomes more common, we’ll see a lashback if dashboards become practically inoperable when they are cluttered with YOUR LICENSE EXPIRED notices. Site developers and end users will likely find themselves needing to think ahead about long-term license management and how best to manage license renewal, ownership changes, etc. Plugin and theme providers who make this friendly and easy will get a lot of thanks.

        I would not be surprised to see services like ManageWP and managed WP hosts partner with plugin and theme providers to give incentives to ManageWP users to buy and renew multiple licenses in one shot for one price split between different plugin and theme vendors. There’s an obvious synergy to be exploited there. WP hosts and services like ManageWP can see all the commercial plugins their users use most, whether they are updated and on-license or not — that gives them the opportunity to function as valuable affiliates with theme and plugin companies.

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