Friday, August 28, 2009

Simple Pricing of ScrumPad Explained

Although our pricing model is simple, it maybe confusing to some of you at first. This is because we are so used to seeing the traditional SaaS pricing plans that we don't even think about better alternatives. Before I explain our pricing model, let's see what a traditional SaaS pricing model looks like.

Traditional SaaS pricing model is usually designed as a matrix of features and levels of plan with progressively higher price. For example, let's see the pricing page of Github, a popular version control system built on top of Git as SaaS. What do you think of the plans? There are 7 different plans differing along 3 attributes- number of projects, amount of disk space, and of course, number of users ("collaborators" as they call them). Here comes the difficulty in choosing what plan is the right plan for me. Hmmm... I have 4 projects and probably will not have more than 5 any time soon. I guess "micro plan" should be good enough for now. Right? Wrong. It would not work because it only allows 1 user and I currently have 12 users. I actually need to get the "large plan." But wait a minute, then I would be overpaying since it is for 25 users and 50 projects. Until I get to that point, which may never happen, I have to bear the pain of overpayment. If you are not confused (and probably a little unhappy since you have to overpay) already, try to determine how much disk-space you would need. The large plan comes with 6 GB disk space. Pretty good, right? What if you start to hit the disk space cap before you ever use up your number of users and projects quota? Man that would add to our pain even more.

Don't get us wrong. Github is a great service. We would have used it if we were not in a pickle to select the right plan for us...:-) Github is not the only one with this problem. This is the case with all SaaS offerings.

Enter our world. ScrumPad is priced as per user per day basis. That is it. So, there is just one data to deal with for you to make the decision. If you think the price per user per day (which is equivalent of $21/month/user) is reasonable for you, you sign up. You never have to worry about disk space, number of projects, bandwidth (data transfer) etc. etc. Now consider our "auto discount" policy. We apply appropriate discounts to your invoices every month based on your average number of users in the month. You don't have to even ask ahead of time. You can now sleep well at night knowing that you are always paying for the exact number of users you currently have. Your number of users can grow and shrink on projects. You do not have to upgrade to add more users, and downgrade when you don't need them. With traditional SaaS pricing, you could end up paying more just because you forgot to downgrade.

Additionally, we put ourselves on the line by invoicing you at the end of the month (unlike everybody else). Not only that, we do not automatically charge your credit card (in fact, we do not even take your credit card information. That is handled by Amazon). Instead, we ask you to explicitly pay us every month. If you are not happy with our service in any month, we allow you to ask for waiver. This is because we want you to use it every day. We want you to actively help us shape our service that you love to use everyday. Not just pay and forget about it. We want you to pay us for the right reason, not because you prepaid us.

Finally, we plan to continue to bring to you more and more value added features at the same price.

We would love to hear from you what you think about our pricing model and policy.