in november, I ran a big scary pricing experiment for ColorBliss.
i wanted to see if I could:
1. Increase first order value
2. Increase annual subscriptions
3. Lower limits on plans to increase margins
it was the hardest thing I've done since launching ColorBliss last year.
here's what happened:
I started off by doubling my monthly prices and raising annual prices by 30%. In marketing speak, I was able to say "6 months free / 50% off when billed annually".
I'd seen some other builders do that, and wanted to see if I could juice annual sales.
I ran with that pricing for two weeks and:
1. free to paid conversion dropped from 1% to 2%
2. new revenue per pageview dropped 75%
3. overall new revenue dropped 75%
that was a harrowing 2 weeks for me emotionally. there were still signups, so it was cool to see that some folks were willing to pay 2x the previous price for ColorBliss. but it was scary watching my revenue drop that fast. i got into a bad mood, and was very irritable. just ask my family... 😅 not my proudest month as a father and husband.
after two weeks, I decided it wasn't working, and that it was time to switch things up.
I took my original annual pricing and raised it by 10%. Then I structured my monthly plans so they would be ~50% higher than before. In marketing speak, this lets me say "5 months free, 40% off when billed annually".
here's what happened this time around:
1. free to paid conversion bumped back up half a point
2. new revenue per pageview jumped back up to where it was before the pricing experiment
3. overall new revenue jumped back to where it was before the pricing change
the added thing here is that I am acquiring less customers with this pricing change, but I think this is a good thing. my margins are higher on the customers I do acquire, and there is less support for me to do.
I'm still watching the metrics over the next few weeks, but I'm feeling good about v2 of this experiment.
One of the main things I'm taking away from this is I need to work on some emotional resilience and not tie my emotional state so closely to how the business is doing.
Any pointers?