Art Of Value

Discover Value | Create Options | Start Pricing

  • About
  • Events
    • AOV Conference 2017
  • Podcast
    • Accountants
    • Bookkeepers
    • Creatives
    • Developers
    • Lawyers
  • Work Together
    • Coaching
    • Consulting
    • Speaking
  • Contact
Pricing the First WordPress Host with Josh Strebel

Pricing the First WordPress Host with Joshua Strebel – 039

March 31, 2015 by Kirk Bowman Leave a Comment

Joshua Strebel is a husband, a father and co-founder and CEO of Pagely, the first managed WordPress hosting company. He graduated college on a Friday, got married on a Saturday and started his business 90 days later with the leftover honeymoon money.

http://traffic.libsyn.com/artofvalue/039-Pricing-the-First-WP-Hosting-Company.mp3

Podcast: Download

Subscribe: RSS | More

Pricing WordPress Hosting

  • What is the most important thing you can share about pricing?
    • Always charge more.
    • Charge what the market will bear – your price is always too low.
    • Pricing lets you choose your customer and assign a value to your work.
  • Does your subjectivity (lack of objectivity) get in the way of pricing?
    • It depends on the customer.
    • Being able to launch a WordPress site is a huge value to someone who doesn't have those skills.
    • It has less value to someone who does not have those skills.
  • Where did you get the inspiration to start a managed WordPress hosting company?
    • In the first 5 years, it was a design shop.
    • Priced the original customers out by increasing their pricing over time.
    • Asked themselves how to make building a website easy, which is what led to Pagely as a streamlined website building company.
    • Asked themselves how to automate the process with basic information to serve previous customers who had less money.
    • After the first 20-30 customers, the model stopped bringing in customers and they put it on hold for 3-4 years.
  • How did you determine your plans and prices for Pagely?
    • Pagely was the first of its kind and there wasn't any true competition.
    • Compared themselves to GoDaddy and others at the time, and they priced their more valuable services at 3x the going rate.
    • Now they have a range of prices from about $24 to thousands.
    • Pagely focuses on the niche where they can profit in their market.

Responding to the Market

  • Did you foresee the market change or did you respond as it was happening?
    • They responded as the market changed.
    • They are pricing toward the value they are delivering to the customer.
  • Do you consider managed hosting to be a SaaS application?
    • Yes, they do consider themselves SaaS.
    • “WordPress as a service” is the phrase they coined.
  • What is a common mistake owners make when pricing a SaaS app?
    • Always pricing it too low.
    • The freemium model doesn't work.
    • Don't give away services.
    • Be aware of the competition, but benchmark off where your desired customer is vs. your goals and values.
  • What is an example of a SaaS app that is pricing well?
    • Optimizely is cool – great app for A/B testing, and isn't cheap, but the value is there.
    • They earn their pricing because their UI is intuitive and slick.
    • An app has to look good, not just work well.
  • How is pricing a SaaS app different from pricing other products?
    • Products are a one-time sale.
    • SaaS is more like a lease.
    • Josh's example of using Basecamp shows how he got value and they made money.

The WordPress Economy

  • What is your opinion of the state of pricing in the WordPress economy?
    • Everything is too low.
    • To be taken seriously, you have to put a dollar value on your product.
    • You are incentivized to innovate if you are well-paid, which helps you keep and earn customers.
  • Where did you get the inspiration to start the PressNomics conference?
    • As a community member, they would speak at WordCamps, but then stand in the hall and network after the session was over, rather than attending other sessions.
    • They wanted a business conference for WordPress rather than a technical one.
    • It is the missing link.
  • Where did you get the idea to invite your mastermind group to speak at PressNomics?
    • His group is full of successful people who drop knowledge bombs.
    • He learned from their lessons and wanted to share their insight.
  • What have you learned from the members of your mastermind about pricing?
    • Their pricing ideas are all over the place; no one is a master.
    • One member is playing a freemium game, which is working at the low-end.
    • A theory is brought to the group and then the group follows up on the data six months later to discuss what happened.
  • Does the mastermind group serve as a pricing council for you?
    • Yes, they do.
    • When product launches happen, they do mental exercises on pricing.
    • You need points of reference outside to price well.
  • How do you think PressNomics has influenced pricing in the WordPress economy?
    • Josh didn't have a firm grasp on what it was 3 years ago.
    • PressNomics definitely raised the question and has gotten people talking about pricing.
    • The ecosystem is its own best and worst enemy, due to its open-source nature.
    • You don't have to be poor to work with WordPress.
  • What have you learned since you published the pricing chapter in The Art of the WordPress Startup?
    • Sean O'Brien (MBA from Harvard) wrote the post on pricing elasticity, Startup Pricing 101.
    • Pricing experiments were done on Pagely: the lowest price increased their customer service costs on less-savvy customers and some of the medium-priced customers dropped to the lowest price.
    • Experiment on pricing and adjust your offerings, as the market changes around you.
  • What is one of your best stories about creating value for a customer?
    • PressNomics is the ultimate give-back.
    • The price for PressNomics was noted as too low by the attendees.
    • They priced it high enough to keep the “freelance 101” people out, but low enough that it is affordable. It is priced that way on purpose.

About Joshua Strebel

  • Co-founder and CEO of Pagely, the first WordPress managed hosting company
  • Started PressNomics, a business conference for the WordPress community
  • Twitter: @strebel

Filed Under: Episodes, Software, WordPress Tagged With: Startup, Web development, WordPress

Leave a Reply Cancel reply

Your email address will not be published. Required fields are marked *

Search

Email List

   Join   

Podcast

Subscribe

Copyright © 2023 · Centric Theme on Genesis Framework · WordPress · Log in