Pricing Competitiveness

I began offering Campaign Monitor to my clients a year ago with a little success.  A year later, I'm getting more inquires for the service, but the invariable question always pops up.  "Have you heard of Constant Contact?" Followed up with, "why are your prices so much higher?"

So, dispensing with the obvious product model comparisons ... my question is this ...

Has anyone successfully implemented a "monthly" payment scheme with Campaign Monitor?  And, if so, how did you structure the usage and payment plans to make it work?  Also, how do you keep track of the number of emails delivered?

Fact is: We all know CM is far superior to Constant Contact (among other solutions).  But, I can't compete with their pricing model when money is the sole criteria for choosing an HTML email provider.  They also have more cash to dump into advertising than I do.

Mathew Mathew, 7 years ago

We definitely have had some customers who charge monthly, which can work if you know that the client sends (say) twice a month to a list of roughly the same size.


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therealjustinlong therealjustinlong, 7 years ago

I use CC for email surveys I really don't like using them but they are the best that I have used so far for customer surveys. A monthly subscription model would work as long as the user is sending the list to the same size group each month. But with a client that has a fast growing list that could be problematic and time consuming. I have been trying to figure out how I am going to charge my clients and I am leaning towards moving away from a monthly charge with the argument to my clients that sometimes you are not going to send out campaigns and then you will be paying for a campaign for nothing. I would like to hear other peoples ideas on what they do. Usually I try to stay away from clients that price is the deciding factor for everything that they do... it is more stressful for me when that is the case.

paul16, 7 years ago

CM is always an interesting sell.  Even though I offer it as a logical add-on service to web development, I have had very few clients sign on.  "Free" always seems to win out over the logic of not losing money each month once you hit the 501st subscriber.  Perhaps, my sales pitch just sucks.

I'd love to hear from someone who offers monthly plans.  How do you track the list size each month?  Are you buying credits to offset the cost for your clients?

bubbly, 7 years ago

I don't know how they'd do it or the cost/benefit factor to them, but can tell you as someone selling it in a self-service fashion (we're just getting started) - this would be a home run. For those businesses looking to send frequently, the credit or per email rate just gets too expensive.

vince, 7 years ago

In order to provide the best service, we need to adapt to different client needs, so I believe that offering both charging models would be best way forward.

sagalout, 7 years ago

Does CM have any plans to introduce a monthly plan? 

We've used it for a few years now and are happy with the product, however we have a TV channel that wants to send out 6 emails a month to its 100k member database.  We cant use CM for that as its far too expensive charging per subscriber on big lists, so we went with oemPro.  Unfortunately their V4 software is incredibly buggy so we're looking around again at laternatives.  Mailchimp do a monthly plan based on number of subscribers rather than number of emails that would work for us, but we would prefer to keep everything together and stick with CM as the reporting and white labelling is better.

So, anything in the pipeline?

tomatofish, 7 years ago

I second this idea... I have a client currently that wants to send out to 42,000 a month and wants to grow his list to add another 7K this year. I'm going back and for with him trying to get him to switch from Constant Contact but he's stuck on price! At this point, I'm selling my email analytic services for free (a $300+ service monthly) for him to even consider switching.

It's all about ROI for my clients, as it truly should be, so I try to sell the ROI of CM via the great reporting and higher response rates. I've posted a comparison of CC, Vertical Response and CM on my blog at: http://www.tomatofishmktg.com/freshcatch/?p=14 if you're interested in looking at it.

I think I could sell to larger clients with a monthly fee -- if that's in the pipeline coming soon, please let us know! After all, the more money we make the more CM makes, right?

Pangdene, 7 years ago

Can we have a response from CM please?

CM ticks all the right boxes for me (except Autoresponders), but the pricing plan is too rigid and makes it uncompetetive in the Marketplace right now.

We need more flexible pricing options - thank you!

daxdiri, 7 years ago

+1 Going to switch over as soon as CC offers monthly plans.

travisbell travisbell, 7 years ago

Hey guys,

We don't have any plans at this time to offer a monthly pricing plan but we are listening. Hearing reason how and why monthly pricing works better is exactly what we're after.

Thanks for all the good feedback.


--
Travis Bell
Stormy Stormy, 7 years ago

Hi Travis,

I think one of the key things is client perception. If you're charging on a per-email basis, this puts in mind that you're being charged for each email you're sending out. With a flat rate fee, it feels more like you're paying for a service and you don't think so much that everything you're sending out is costing you more money.

For the main part, it's all down to perception and the psychological angle. However, when you start talking about the big hitters with 6 figure subscriber lists, it can make a world of difference in the client's eyes to be told that it's x price per year for the service, rather than it's x price per campaign.

Additionally, it allows a much greater budgetary control for clients - you have a set price and don't have to worry about thinking over the cost of an email campaign each time it's sent.


No-one expects the Spanish Inquisition!
circlesquare, 7 years ago

I would have to refer back to the first paragraph of the first post. We are getting more enquiries, but with the economy the way it is, price is more important than service/features.

I've lost a few clients because of the fixed price rather than monthly fee. I want to offer CM, I need to be competitive.

karlito karlito, 7 years ago

Great discussion. We're in the exact same boat.

After a great deal of work, free consulting etc. etc. a *qualified* prospect announced that they had other marketing initiatives and lists that they'd like to move to us. This would mean 6 campaigns a month and 80,000 emails... We're dead in the water!

I think we need to ask ourselves the question... is there a ceiling on what can be charged for email delivery (and reporting). Even in the boom times I wouldn't expect any company to part with $800 to send out email... certainly not monthly. 10k per year... just for delivery?

We *love* CM. Help!


http://www.ingage.ie
karlito karlito, 7 years ago

Hello again

I've started a discussion here asking what you feel is the the most we can charge a customer for a campaign delivery - before the dollar numbers get out of hand. A ceiling if you will.

http://www.campaignmonitor.com/forums/viewtopic.php?pid=6462#p6462

Hopefully our numbers might help the guys with theirs.


K


http://www.ingage.ie
vince, 7 years ago

May I be so bold as to offer CM a WARNING.

If you not only go with offering competitive monthly plans, as well as pay-per-email options, be prepared for a massive increase in both resellers and clients.
Then if you offer resellers a better price than 'anybody that signs-up', that would be the icing on the cake.

As you may or may not want this to happen, you have been WARNED ;-)

werm42, 7 years ago

"Hey guys,

We don't have any plans at this time to offer a monthly pricing plan but we are listening. Hearing reason how and why monthly pricing works better is exactly what we're after.

Thanks for all the good feedback." ---travisbell

I had sent an direct response to my "frequent representative" at campaign monitor last month about this LOOMING pricing issue (no, not Travis), the response I got made me feel like I was the only one complaining about it. Now seeing this thread makes me feel better.

Since Travis states that CM is "now listening for input re: why a monthly plan is a good idea" let's start with the obvious:

While it rolls off the tongue nicely to say "We offer a pay-as-you-go email service", as a salesperson you then seem a bit back-handed when discussing how "Email marketing is more effective when it's done residually rather than sporadically". So for point number one why subscriptions are ideal: Subscriptions are ideal because they are conducive to getting the most out of your email marketing. The pricing aligns with best practices, not against them.

Subscriptions are also ideal because: With any client who's trying to send to large lists, your dead in the water on this pricing structure, period. At some point you hit a ceiling and cannot facilitate client's with a certain volume. The "bulk discount" isn't conducive either, because your stuck sending the emails for your clients.

As someone who's just spend $7,800 promoting their CM email marketing platform, and has ZERO sign-ups, I can't help but feel that my marketing dollars would have been better spent buying into an AWeber Reseller Agreement for $5k.

As someone who's worked in email marketing for nearly 10 years, and has done email marketing for a number of HUGE co.'s like the Wall Street Journal amongst others.  I've also worked with 90% of the email products out there, and can confidentally say that 88% of them are absolute garbage. I love the CM product, truly a top-notch deployment. Easy to sell the features.

I don't have any problem selling people on the reasons why they should be doing email marketing, the simple fact is CM resellers cannot compete with the other avenues, even when you throw in things like consulting, design, etc. The cost of each campaign is simply damn silly.

fz, 7 years ago

I have to agree.  I think CM is a far superior product with an excellent user interface.

That said, when a client can use Mail Chimp to send multiple mailings each month to a 500 recipient list for the same price as one mailing on CM, it's a tough sell. 

I've been struggling to come up with a monthly plan that will somehow seem somewhat competitive with mail chimp, but as a freelancer, my budget isn't big enough to risk eating any of the costs myself.  Similarly, my clients are working on lean budgets and it's hard to justify the added cost.

Alternately, if the $5 fee was charged only once per month, that would open my options to developing a monthly plan that seems somewhat competitive with the other services.

rishdog, 7 years ago

If CM offered a monthly solution similar to what Mailchimp does then i would definitely sign up to it instead of the email credits. At the moment i am deciding if we stick with CM (which we all love) or go to Mailchimp (which is less flexible and harder to use, but a lot cheaper for what we do) and the main driver will be costs.

With monthly charges, it will only work for us if there is no restrictions and its charged on how many subscribers mainly because we send emails frequently. However that also means CM will be losing $$ as many of us will take that option. 

There has to be a happy medium.

ChrisInCincinnati ChrisInCincinnati, 7 years ago

The current pricing really only does work for small clients with lists under 5k. I want to land the big client with the 50k list but I can't even begin to do that with CM.


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vince, 7 years ago

current pricing really only does work for small clients with lists under 5k

Even them only if sending once per month. :-(

Mitch, 7 years ago

Hmm. I do think there's got to me some scope at the top end for price assistance. The pre-paid credits option I think does a bit to alleviate this, but I can see how it would be challenging to sell at $10,000 pa.

Having said that, many of our clients spend exponentially more on print marketing, so email marketing offers real value. The biggest advantage being that through analytics and response it's been very easy to illustrate conversions - CampaignMonitor pays for itself.[1]

As I said though, I think there's got to be scope for a more creative approach to pricing at the top end of the bracket - even if it involved CampaignMonitor taking the "Over x,000 emails a month? Contact Us" approach and nutting out a way to help people land those bigger clients.[2]

There's a certain thing I like about the higher pricing, not only do I think CM is the best-of-breed and thus commands a premium, but I think it protects the brand (and indeed the mailservers) from anything that would ultimately be a detriment to our client's work.

[1] Thinking this through, I guess it's arguably difficult to prove that this is necessarily a quality of CampaignMonitor itself or of email marketing (or our advice on how to leverage it) more generally. As discussed above though - and as you'll all know - CampaignMonitor brings a lot to the table that no-one else offers - in terms of analytics, ease of use and quality mail servers. I guess you've got to factor in the total cost of the product, in terms of production, delivery (or lack thereof), conversion rates etc and I think in most cases CM trumps the other products when you take a more holistic view.

[2] Yea, mulling this point over having finished typing up the rest of the post, I really think Campaign Monitor could add a lot of value to their business and to designer's by charging someone with looking after high-volume customers on a more discretionary level.

PS. Excuse the footnotes. :)

circlesquare, 7 years ago

Sorry to bang away on the same old drum, but we've lost a client that wanted to send to 40,000+ subscribers once a week - the cost was just too prohibitive. What do I do?

Mathew Mathew, 7 years ago

Please see my (very long!) reply in this thread: http://www.campaignmonitor.com/forums/viewtopic.php?id=1901 where I explain in more detail what our position is, and why we take that position.


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