> we do need to migrate everyone to the new pricing
You can't change your pricing upwards for existing customers, ever.
You can change your price to anything you want for new customers.
You can decrease your prices for anybody at any point in time.
Something like chargify is the basis for the business models of other parties, if you made a deal in the past you have to honor it, so that your customers can honor the deals that they made.
First, it's crazy that Chargify is not talking about this here and responding. (Update: they are responding quickly via Twitter)
Second, when will companies understand and learn that you simply CAN NOT do this. Hell, how can any board member let a company do this?
We just started looking at Chargify for all OpenDNS enterprise users (doing many $mm/year in transactions) but we thought their pricing might not scale up for us. So we had it on hold. The distinction between free and paid customers was critical for us.
Now I know I was right not to pursue it. We'll continue with our home-built solution.
Why? Milk is more expensive than it used to be. Songs on iTunes are $1.29 now. I don't see any reason whatsoever that a company can't increase rates. Inflation and rising costs are facts of life. Even if they weren't, if a company realizes they can make more by charging more, then why shouldn't they?
They shouldn't have made such a massive price hike, and they should have given more notice, and I think that's the real issue.
Because milk won't go up from $.99 to $99 per month in one day.
Of course inflation and rising costs are a fact of life. But the economies of scale in a business like this lead to lower prices, not higher ones and the main excuse chargify seems to have for raising their prices is the fact that they are successful at the 'free' tier.
Which is something they should have factored in from day one, not come up with after a whole bunch of people have tied in their lot with them. This is a black eye for the whole third-party processing business, not just for chargify.
You don't remind your customers how much you have them by the short & curlies if you can help it, you make course changes nice and slow so you don't rock the boat. And if you mess up your planning you can either open your books and work it out in tandem or you can eat the loss and charge it to your education fund.
> You can't change your pricing upwards for existing customers, ever.
That assumption needs to be questioned. There are times when it's appropriate to raise your prices for certain goods and services. In fact, there are times when you must raise your prices if your business is to survive.
But this is not one of those times. What you do is you adjust your businessmodel so your new model takes in to account grandfathering in the old customers. Who over time will fade away so the problem will take care of itself.
We're not talking about a price hike that is caused by an increase in cost of raw materials or such. And even those usually don't radically cause your business model to shift, they will just cause an adjustment of a few percent or pennies to accommodate the underlying shift.
For instance, I have a very good deal with moniker for my domains, if they underlying price changes I pay for that. This is logical because moniker has to pay it too, so they pass the cost on 1:1. It's not like they told me 'first 50 domains are free' and then suddenly turned around and started charging me $100 / month.
You can't change your pricing upwards for existing customers, ever.
You can change your price to anything you want for new customers.
You can decrease your prices for anybody at any point in time.
Something like chargify is the basis for the business models of other parties, if you made a deal in the past you have to honor it, so that your customers can honor the deals that they made.