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We are nearing the launch of our website which is a wholesale marketplace and network, which hosts transactions between Buyers and Sellers. We are deciding between two offers for a period of free use and have reached a stale-mate in terms of which one one makes the most sense.

Both are subscription-based models, here are the two versions:

$10(just an example) a month subscription fee. Subscription Billing begins only after you have made your first sale on the website. The day you make a sale, the $10 a month fee is charged and that defines your billing period.

$10(just an example) a month subscription fee with a 30-day free trial. Subscription billing begins one month after the day that you register your account, regardless of whether you sell or not.

There is a 3% transaction fee on all purchases, from the first sale and on, regardless of the free offer.

Any advice would be greatly appreciated in terms of which one would be best to pursue, or if you have suggestions for other models.

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It would be helpful if you spelled out whether you are already 100% confident that you are confident that the monthly subscription represents evidenceable good value, or whether you're testing both the pricing level and the introductory offer – Jeremy Parsons Oct 3 '12 at 19:56

2 Answers

up vote 2 down vote

You need to talk to potential customers and find out what they would prefer. No one here can tell you that.

Why charge a monthly fee at all? If the platform works well for your customers you should be able to make enough from your transaction fees.

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As a seller, I would be more inclined to go with the $10 after the first sale, but I question what do I get for my $10. You are already getting 3% – Mark0978 Sep 12 '12 at 18:02
up vote 0 down vote

1) Next time figure out pricing and understand what users will pay for before you develop the product. It leads to far fewer unpleasant surprises.

2) When it comes to either/or pricing decisions my general advice is to run an a/b test and see which one nets you more money. Here's a nice pricing a/b test story for you http://www.kalzumeus.com/2012/08/13/doubling-saas-revenue/

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