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A few weeks ago, Better Notifications for WordPress surpassed 10,000 downloads on the plugin repository. I’ve been actively developing it all this year and have ensured that i’ve provided the best free support I could, adding new features, expanding the roadmap, and prioritising future development. A major part of this has been planning my first two premium add-ons, due out (hopefully) before the end of the year. With this, comes a number of hurdles to overcome, not the least of which is pricing. How do you go about pricing a product? The truth is, I don’t know – i’ve never had to do it before.

Swap situations for a moment to my web design business where I use WordPress to build all my client’s websites. Pricing a project is fairly straight-forward:

  • Look at the brief.
  • Multiply my hourly rate by the number of hours required to complete the brief.
  • Look for any specific requirements that aren’t standard in most websites.
  • Add together the costs for any plugins that meet those requirements.
  • Add on some time for set-up.
  • Add on some time for any development work needed to integrate them.
  • Separately list any other costs I can think of / foresee, just in case.

This is something i’m reasonably fluent in and get right most of the time.

Swap back to pricing a premium add-on for a WordPress plugin and i’m stumped. So, after a doing a little research, i’ve put together my own idea of how I think this should work in the hope that it will help others in the same boat.

Looking at other premium add-ons for free plugins, such as Easy Digital Downloads or WooCommerce, I calculated the percentage difference between their licensing options. These usually are valid for the period of one year and include updates and support in the following flavours:

  • Single Site
  • 2-5 Sites
  • Unlimited

From a wide selection of the most popular, first-party add-ons, I found that the percentage difference between a Single Site license and a 2-5 Site license was anywhere between 50% and 100% and the percentage difference between a 2-5 Site license and an Unlimited license was anywhere between 40% and 60%.

So having this rough formula for price differences, I just needed a starting point for a Single Site license. Unfortunately, the diversity of prices for Single Site licenses prevented me from finding an easy answer so I’ve decided to base this on another simple formula:

  • Pricing should be in US Dollars instead of Pounds Sterling. I’ve observed that most people seem to understand USD when it comes to purchasing digital goods over GBP.
  • Pricing should be in nice round numbers – no cents!
  • The cost should be within reach of as many WordPress users as possible. As BNFW is designed to extend the default WordPress email notification system and to be as easy to use as possible, this makes a lot of sense.
  • The price should reflect the amount of additional functionality that the add-on provides. E.g. If it adds a couple of checkboxes, start with $5. If it adds additional functionality and connects to a 3rd party service via their API, start with $49. And so on.
  • The USD amount should look like a healthy, non-underpriced equivalent when converted into GBP.
  • The price should be exclusive of Tax. This is mostly due to the EU VAT Law and prevents you from taking a (potentially) huge hit on the base price of a license depending on where customers purchase from.
  • The pricing should follow as many conventions / first-time buyer instincts / behavioural studies / cultural acceptances as possible.
  • The price should still be acceptable (to both yourself and your customers) after a 10% – 30% store opening discount, flash sale, license renewal discount, etc.
  • Armed with all of that, you should then be able to work out a rough starting cost for a premium add-on for a WordPress plugin. Here’s an example:

Single Site License: $29 (Low to Medium functionality add-on).
2-5 Site License: $64 (A price difference of 75.2688%).
Unlimited License: $105 (A price difference of 48.5207%).

Beyond that, you may have to factor in other costs such as servers, additional services, APIs, etc. that you may use to provide the add-ons wider functionality. You may also wish to include a little future-development cost in there too but hopefully, if you’re doing it right, this should come from volume as opposed to singular sales.

Remember though, there are no hard and fast rules. If your plugin gets more complicated, the economy dips, or exchange rates effect your currency, you should be able to change your prices accordingly. Hopefully though, the above information should help re-adjust things a bit.

I hope you enjoyed this post. If you find any of this confusing, have anything to add, tell me off for suggesting something inappropriate, or suggest and alternative formula, do let me know in the comments!