Houston we have a problem - Pricing!

We've been working hard for almost 2 years to re-brand our company, enhance our service offerings and expand our business.  Until now we only provided our email/web hosting and web design/marketing services to web project customers.  We've always hosted our own clients and provided email services to them.  Now we're opening our services up for a broader market and allowing each service to be purchased individually and if desired, self-managed by the customer.

In addition to our core design and marketing segment, we've added new hosting and email services with end user management options, and are ready to launch the last piece of the plan, our new email campaign service.

We signed up with CM two years ago as email campaign marketing is a critical component in our plan but have been so busy putting our other services together (all the while keeping client project production going) we weren't ready until now to get the CM component added to the mix.

Problem is, we started working on our pricing models for it this past few weeks and we've run into a brick wall with CM.  The base monthly pricing is so high we can't compete even if we didn't mark the service up at all, which defeats the whole purpose of using CM.

CM's base pricing before our markup is higher than almost every other service we've looked at including Campaigner (the cheapest), MailChimp, iContact and (gasp!!!) even Constant Contact.  Holy cow!  It's not just a little higher either...in some cases it's 25% or more before markup.  In addition, most offer integrated social media marketing and free spam/deliverable testing ($5.00 USD per test here).

When *I* pointed us here a few years ago and we were in the planning stages, there were almost no white label/wholesale options like CM, the pricing here was workable, and everyone loved the idea.  Now most of the other email campaign services also offer white label/branded accounts and are much more competitive in both pricing and features.

We've having a serious internal debate over launching with CM or postponing and going elsewhere.  Even though we've spent time branding CM, working on integration, etc., how do we compete in the marketplace using CM when we're over-priced and under-featured before we even markup the first penny?

I know there are many CM fans here so don't shoot me.  I'm not here to slam CM.  I got us into this in the first place because it seemed like a great opportunity and was at the time about the only game in town.  But now my tail is on the line, I look like didn't do my research before suggesting CM (although that was 2 years ago) and I'm just looking for feedback to present to our group before a decision is made this upcoming week.

Any feedback from CM and current CM customers about how you compete given the substantial pricing deficit you're working under compared to the competition, what CM features overcome that and what arguments am I missing, would be greatly appreciated.


roshodgekiss roshodgekiss, 6 years ago

Hi Jett, welcome to the forums and many thanks for your frank feedback here. Admittedly, it hasn't been our imperative to tick all the boxes on a features matrix, or come in cheapest (or even second cheapest) in terms of pricing. Instead, we've focused on creating a service that your clients will (hopefully) love to use, is backed up by 24/7 human support and doesn't charge extra for things like campaign hosting or social sharing reports. With luck, these things are worth paying a little extra for.

We recently published a case study with a UK design agency that may assist you with providing feedback. In summary, customers are happy paying more than rock-bottom pricing if they're receiving value, eg. education/consultation from the designer/reseller, a simple way to turn around campaigns, support and of course, measurable return on marketing spend. Keep in mind that most of your customers are probably approaching your rebrand because they either don't have the time or expertise to manage email campaigns themselves, so with that appreciation, it isn't likely that that they will jump ship for Constant Contact et al. because their pricing is cheaper. Chances are, they'll be happy because they like using the template editor, the reports are straightforward to access and most importantly, they have a relationship with you and trust your service.

Finally, one pricing model does not always fit all clients, so it may be worth looking into how both our monthly and PAYG models can be offered to suit different send frequencies and budgets. For many folks, a big selling point is that there's no ongoing commitment. For others, it's that they can send all they like for a predictable sum each month. Flexible pricing models can be a massive bonus.

Many thanks, Jett - if there's anything else we can assist with, please don't hesitate to contact our team. As mentioned above, we're available anytime :)

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