Image may be NSFW.
Clik here to view.
As entrepreneurs, we’re constantly seeking ways we can improve our product or service.
Isn’t that what most of us are driven by? To make something that wows our customers?
We’re constantly iterating, testing, and making tweaks in the hopes that our project will take off.
[author_more]
But what if some of that effort was unnecessary?
Instead of adding a new feature, what if you just needed to change your pricing structure?
Now, don’t get me wrong, I’m all for making improvements to create a better experience for the customers. But, I’d like to share with you how changing our pricing structure transformed a side-project into a real business.
You’re probably wondering: can changing the pricing actually change my business?
My answer: Yes. Absolutely.
First, what should we consider to be a real business?
I’m sure there are plenty of different opinions on this. Some might argue that a real business must be funded by VCs or have some insane multi-million or billion dollar valuation.
Obviously there are exceptions, but for this post, let’s assume that a real business is any venture that generates enough revenue to support the expenses of the business and the team running the business.
When you’re working on a side-project you’re likely doing additional work to support yourself. With a real business, that’s no longer necessary.
The Starting Point
I help run a cheap flights service where we send out killer international flight deals departing from the USA and Canada. There are currently two subscription levels: Free and Premium.
The Free Subscribers are mostly testing the waters and getting a feel for the quality of deals that Scott (my business partner) sends out. They get one third of the deals that are sent out.
The Premium Subscribers pay a few dollars per month and get all the deals that are sent out.
We originally charged $2 per month to be on the premium list. At two bucks a month, it takes a lot of customers for it to be considered a real business.
If we wanted to make $10,000 in a month, we would need 5,000 customers. This isn’t impossible, but it would take awhile to get there.
Continue reading %How Changing Our Pricing Turned a Side Project into a Real Business%
