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Pricing Strategy for Point Of Sale System

    • 1 posts
    February 16, 2013 8:24 AM EST

    I have an online point of sale application called php point of sale. I sell it in 2 formats:


    1. Download version which a user configures and installs on there own web server or computer

    2. Cloud/Hosted version where the user runs the system from our server.


    My current pricing strategy was $99.00 for 1 year of access to updates for download and $29.00 / month for hosted solution (14 day trial).


    I was getting about 80% download and 20% hosted. My goal is to get more hosted customers as I make more money this way and it is a better experience for the end user.

    I tried raising my price of my download solution to $249.00 and did this for 4 days and only got 1 sale.

    Based on the market and my current product, what would you suggest for a pricing strategy. Long term I want to have more hosted customers.

    • 20 posts
    February 17, 2013 3:34 AM EST

    First, it is important to know if you have done an analysis on what your competitors are charging, both for hosted and .exe versions.  This is a crucial piece of your pricing strategy.

    Next, are you calling out your features nice and strong vs. your competitors?  It is important to give your customers are reason to enter their payment information other than just on price alone.  The worst differentiator for any company is price - because it is very easy for a competitor to drop a price and wipe you out.

    With that said, Would you consider dropping the download version all together for bit and try and all hosted pricing scheme?  Personally, I feel your price gap is currently too high, $360/yr online or $99/yr to download.  It seems like a no brainer that I would just download.  

    Offer a monthly subscription price, your current at $29.99 if it is in line with your competitors.  

    Also offer a yearly subscription, that offers a good discount and reason to purchase.  Say $250/yr.  That is still giving you a double  the revenue per subscription than your current download option.  You can always increase the price as you make the software more robust.  

    I hope this helps.


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    • 20 posts
    February 17, 2013 3:39 AM EST

    On a side note, the site and product look great.

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