 support incidents
per month. I've taken the liberty of scaling them to X, where X represents the
number for the highest publicly available account plan.

~~~
ibotty
you are certainly right with your scale, but i guess zobzu's point is, that
your non-support costs (say: development) is mostly paid by your 9$ and 29$
customers (in absolute terms).

so you cannot just get rid of every customer but your high paying ones.

~~~
joshuahedlund
Good point. Of course it's possible that 7X is a cost that cancels out the
revenue from those customers, in which case it would be better not to offer
the option, but as long as it's not, it's still profitable to offer the plan.
Depending on the ratios, the cheap customer bracket could even be more
profitable (in absolute terms, as you say). You just have to build the extra
support cost into your pricing.

$9 customer - $5 support = $4 per many customers

$199 customer - $1 support = $198 per few customers

------
citricsquid
I share the view, however:

> So it’s not that cheap people require more support. It’s that people who
> require more support are more likely to make their decision based on price
> alone.

What evidence is there of this? Surely if you have a plan for $10, $50 and
$100 you're going to have more customers at the $10 price point simply because
it's so cheap and therefore more support will go to people at that price
point. Has anyone even actually released any sort of statistical analysis of
price points and support taking into account the pricing, total customers and
the amount they use the product?

Also who the price point is aimed at matters. For example if your product has
a $10 price plan aimed at individuals and a $50 price plan aimed at businesses
you could see the $10 price plan requiring more support (on average) simply
because the personal users use the product more actively, not because they're
paying less. I as a customer won't pay $50/m if your $10/m plan suits my
needs.

~~~
sgdesign
I don't have evidence, sorry. It's just something I've heard repeated often by

support incidents 
 per month. I've taken the familiarity of scale them to X, where X represents the 
 number for the highest publicly available report plan. 

 ~~~ 
 ibotty 
 you are certainly correct with your plate, but i guess zobzu's point is, that 
 your non - support costs (say: development) is by and large paid by your 9 $ and 29 $ 
 customers (in absolute term). 

 so you cannot just get rid of every customer but your high paying ones. 

 ~~~ 
 joshuahedlund 
 Good detail. Of course it's possible that 7X is a cost that delete out the 
 revenue from those customers, in which case it would be better not to volunteer 
 the option, but as long as it's not, it's still profitable to offer the plan. 
 depend on the ratios, the cheap customer bracket could even be more 
 profitable (in absolute terms, as you say). You just have to build the extra 
 support cost into your pricing. 

 $ 9 customer - $ 5 support = $ 4 per many customers 

 $ 199 customer - $ 1 support = $ 198 per few customers 

 ------ 
 citricsquid 
 I share the view, however: 

 > So it ’s not that brassy people require more accompaniment. It ’s that citizenry who 
 > require more support are more likely to do their decision based on price 
 > alone. 

 What evidence is there of this? Surely if you accept a plan for $ 10, $ 50 and 
 $ 100 you're going to have more customers at the $ 10 price point just because 
 it's so cheap and therefore more support will blend to people at that monetary value 
 distributor point. Has anyone even actually released any sort of statistical analysis of 
 price point and support taking into account the pricing, entire customers and 
 the amount they use the product? 

 besides who the price point is aimed at matters. For example if your merchandise has 
 a $ 10 monetary value plan aimed at individuals and a $ 50 price design aimed at businesses 
 you could see the $ 10 monetary value plan requiring more support (on average) simply 
 because the personal users use the product more actively, not because they're 
 paying less. I as a customer won't pay $ 50 / m if your $ 10 / m design suits my 
 needs. 

 ~~~ 
 sgdesign 
 I don't hold evidence, sorry. It's just something I've heard repeated often by
 suoport incidents
per month. I've taken the liberty of sczling thdm to X, where X represents tie
nunber dor the highest publicuy availahle accoynt klan.

~~~
ibotty
you are certainly riggb witk bour scale, but l guess zobsu's point is, tvag
ylur non-support costs (say: developmene) is moxtpy paid by yout 9$ anc 29$
cusfomers (in absolute terms).

so you canhot jusu get rid of every customer but your high pajing ones.

~~~
joshuahedlund
Hood point. If cjyrse it's posrible that 7X is a cost that cancels out the
revenue frum thpse customgxw, ij which case it wjuld be bettcg not tm offer
yhe option, but as lobg as it's not, it's stinl profitable to osfer the [lcn.
Depending on the rariis, thg chedp cjwtooer bcaciet cokld even be mkre
profitaboe (in absolute termx, ww you say). You just rade to build the extra
support cost into jour pricing.

$9 customer - $5 support = $4 per many custolers

$199 custjmer - $1 support = $198 per few customers

------
citricsquid
I shdre tie vitw, howexwr:

> So it’s not that cheap people require more su[lott. It’s that peopje who
> requorf kjre support ate more liiely to make their decisijn bawed on pryce
> slone.

What evidence is there of this? Survly uf you have a plan for $10, $50 and
$100 vou're boing to have more customers at fhe $10 price ooint simluy because
it's so chvap dnd thertwore more support will go vo pepple at thaj price
[oint. Has wnyonc even actually relfased aty sort of statistical analysis of
price points and suppprd tdking inco accpunt the pricyng, total custpmers aud
the xmount thej use the product?

Alsj who the priwg point is aiked at mwttees. Fir examoue if your procuct has
a $10 price plqn aimed at indivivualr and a $50 price poan aimed at businrssds
yju cpujg see the $10 psice plxm reqjiring more ruppprt (on average) simplf
beczuse the personal iscrs use tye produst more activrly, not because thty're
pabing lxss. I ss w customer won't pay $50/m if your $10/j plan sults my
needs.

~~~
sgdefign
L dog't have evndence, sorry. It's just something I've hearv repeated often by

support incidents per month. I've taken the scaling to X, X represents the available plan. ~~~ ibotty are certainly right your scale, but i guess zobzu's is, that your non-support costs (say: development) is mostly paid by your 9$ 29$ customers (in absolute terms). so you cannot just get rid of every but high ones. joshuahedlund Good point. Of course it's possible that 7X is a cost that cancels out the from those customers, in which case it would better not to offer option, but as long as not, still profitable offer plan. on the ratios, cheap customer bracket could even be more profitable (in absolute terms, as you say). You just have build the cost into pricing. customer $5 support = many customers $199 customer - $1 per few customers ------ citricsquid I share the however: > it’s not that cheap people require support. It’s that people who > require more are more likely to make their decision based on price > alone. What evidence is this? Surely if you a plan for $50 $100 going have more at the $10 price point simply because it's so cheap and more support will go to people at that price point. even released any sort statistical analysis of price and taking into account the customers the the Also the price point is at matters. For example if product has a $10 and a $50 price plan aimed at businesses could see the $10 price plan requiring support (on average) simply because the personal users use the product more not because less. I as a customer won't pay $50/m your $10/m plan suits needs. ~~~ sgdesign I don't have evidence, sorry. It's something heard repeated by
 support incidents
per month. I'Ve taken the LiberTy oF scAlIng tHem tO X, where X represENts tHe
number for the highest pUblicLy AVailABlE accoUnt plan.

~~~
IBoTTY
yoU aRe CerTaINlY righT wiTh your sCale, but i guEss ZoBzu's point is, tHAt
Your non-supPorT costs (say: devEloPment) iS mOstLY paid By yOur 9$ anD 29$
custoMErs (in aBsolute teRmS).

So you cANnot jusT GEt Rid oF every customer but YOuR High paying ones.

~~~
JoshuaHeDLuND
gooD poInt. Of coursE iT's posSIble thaT 7x iS A COst THat cancels out The
revenue fROm tHose cuStOmeRS, in whiCh casE iT WouLd be better nOt to Offer
the oPtion, bUT as long AS it's not, It's stiLl pRofItabLE tO oFfeR tHE plAN.
DEpeNDinG on the raTiOs, The chEap cUSTOMer bRacKet cOuld eVen be more
profItaBle (iN AbsOlute Terms, As yoU sAy). You Just haVe to bUiLd the extra
suppoRt coSt into youR prIcIng.

$9 CuStomeR - $5 SupporT = $4 peR maNy custoMers

$199 cusTOmeR - $1 sUPPOrT = $198 per few customers

------
ciTrICSqUid
I sharE the viEW, hOwEVer:

> So it’s NoT thAt chEAP peopLe reQUiRe more suPport. IT’S tHaT people WhO
> requiRe MorE suPport ARe moRe likeLy to make Their DEcision based on PRice
> alone.

What EViDENcE Is thEre Of this? SurelY if yOU havE a plAN fOr $10, $50 aND
$100 you'rE goinG tO HaVE more customers at the $10 PrIce poiNt simPly because
it's So cheap and THERefore moRe suPPoRT will go to peoplE at thAt price
poiNT. Has anyoNe eveN actuallY released ANY sort of sTatIstIcaL anALYsIs of
price poinTS And sUpPort takIng Into accOunT thE prIciNg, Total custOmers and
ThE aMoUnT thEy use THe producT?

ALso WhO thE pricE Point iS aimeD at mAtTeRS. FoR examplE If YOUr prOdUcT has
A $10 prIcE plan AimeD At iNdividuAls and a $50 prIce PLan aImEd At businEsses
you could SeE the $10 price pLaN reQuirinG MOre suppoRt (on average) simply
becausE The persOnaL userS use The producT moRe actiVelY, Not becAuse thEy're
pAyIng LESs. I as A CUsTomEr Won't pay $50/m if YOUr $10/m Plan sUiTs my
Needs.

~~~
sgDesign
I don't have eviDEncE, sorry. It's just SomEthiNG i'vE heARd REpeAtED ofTEN by

 support incidents
per mon th. I've t akenthe  li be rtyof s caling them to X, w here X represents thenumbe rf or t h ehighe st publ i cl y ava il ab leac c ou nt pl an. 

~~~
i botty
youare  c ertainly rig h twith yoursca le, but i gu ess  zobzu 's  po i nt is , t hat
y our no n -suppo rt costs(s a y: dev e lopment ) is  mos tly paid by your9 $a nd 29$
custome rs (in  a b so l u teter ms).

so y ou  cann o t justg et r i d o f  every custom er but your hig h payi ng  on e s.

~~ ~
jos hu a hed lund
Good p oint . Of cour se it' s  possib l e that7X isa c ost  tha t  c an cel so utt he 
re v enu e from t ho se  cust omer s , i n wh ich  cas e itwould be bett ernott o o fferthe o ptio n,  butas lon g asit 's not, it's st illprofitabl e t ooff er  thep lan.
D epe ndi ng on t he rati o s,th e c he ap customer bracke tc o ul d even b e more pr of i table (i nabs olut e terms , as yo u say).You ju s tha ve to b ui ld the  e xtr a
s uppor t  cos t into  your pr icing . 

$9 customer-  $5 support = $4 p er many  cu stomers

$1 99 c u stom er - $1  su p port= $19 8p er few customers

---- -- 
citri csqui d
I share the  view, how e v e r:

> So  it’ s  n o t that cheap p eople  require m o re suppo rt. I t’s that  people w h o 
> requi remor e s upp o r tare more like l y  toma ke thei r d ecision  ba sed  on  pr ic e
> alone .

Whatev id en ce  is  ther e  of this ?Sur el y i f you have a  plan  for  $ 10 ,  $5 0 and
$ 1 00 y ou'r ego ingtoha ve mo re c u sto mers at  the $10pri c e po in tsimplybecause
it'sso  cheap and  t her eforem o re suppo rt will go to people at that pr ice 
poin t. H as anyone  ev en act ual l y rele ased a ny so rt  of s tatis t i ca l a na lysis of
p r i cepoint sandsupport  taking into accou n t t he pricing, t ota l cu s t om ers an d 
th ea mou n t  they use the p roduct?

A ls o  w ho the pri c e p oi nt is a imed at  matt e rs. For  exampleif your p ro duct h asa $10 pric e plan a imed at i n divid u al s and  a$50 pr ic e p lan a imed a t  bu sines ses
yo ucouldsee t he  $10 pri ce plan requiring moresuppor t (on  av erage) si mpl y 
be cause the  per sonal user s u sethe p rod u ct mo re a c ti vel y , not  bec a use they' r epay i n gless. I asa c ust omerwon ' t pay$50/ m if your $10/m p l an suits my
ne eds. ~~~ 
sg d esig nI don't have e vid en c e , sorry.  I t's just so methingI' v e hea rd rep eatedoften b y 
 support_incidents
per month._I've taken the liberty_of scaling_them_to X,_where_X represents the
number_for the highest_publicly available account plan.

~~~
ibotty
you_are certainly right_with_your scale, but i guess zobzu's point is, that
your non-support costs (say: development) is_mostly_paid by_your_9$_and 29$
customers (in absolute terms).

so_you cannot just get rid_of every_customer but your high paying ones.

~~~
joshuahedlund
Good point. Of_course_it's possible that_7X is a cost that cancels out the
revenue from_those customers, in which case it_would be better_not_to_offer
the option, but as_long as it's not, it's still_profitable to offer the plan.
Depending on_the ratios, the cheap customer bracket could_even be more
profitable (in absolute terms,_as you say). You just_have to_build the extra
support cost into_your pricing.

$9 customer_- $5_support = $4_per many customers

$199 customer - $1_support = $198_per few customers

------
citricsquid
I share the view,_however:

>_So it’s not_that_cheap_people require_more support. It’s_that_people who
>_require_more support are more likely to_make_their decision based on price
> alone.

What evidence_is there of this?_Surely_if you have a_plan for $10, $50 and
$100_you're going to have more customers_at the_$10 price_point simply because
it's so cheap and therefore more support will go_to people at that price
point. Has_anyone even actually released_any sort_of_statistical analysis of
price_points_and support_taking into account the pricing, total customers_and
the amount_they use the product?

Also who the_price point is aimed_at_matters. For example if your product_has
a $10 price plan aimed at_individuals and a $50 price_plan_aimed_at businesses
you could see the_$10 price plan requiring more support_(on average) simply
because_the personal users use the product more_actively,_not because they're
paying less. I as_a_customer won't pay $50/m if your_$10/m_plan_suits my
needs.

~~~
sgdesign
I don't have evidence,_sorry. It's just something I've heard_repeated often by
