Woo is a developer of WordPress themes and plugins. They’re the reason why this blog looks so sassy nowadays. I bought this theme for 70 dollar, and got two bonus themes too, which I use on other sites. It was the first time in my life that I purchased a theme, despite running WordPress sites since 2006 or so (or did I begin in 2008? I don’t remember).
I also use their free shop plugin Woocommerce on one of my sites. The idea with that plugin is that it gives you basic web shop functionality. If you want more functions, you purchase plugins. A good idea that have made Woo one of the big web shop providers for small to middle businesses. (Bigger businesses usually go for expensive shop solutions like Magento.) I’ve purchased one plugin for a payment gateway for 50 dollar. That payment provider lists free plugins for various shop solutions on their website, but for Woo I had to pay for a third party plugin. Also, some basic functionality that is included in other web shop systems – like the ability to create and print an invoice for an order – is not included in the free version of Woocommerce. Want to print an invoice – buy the plugin. Despite this, I’ve chosen Woocommerce instead of the WP-Commerce, which would be the alternative for me. The reason is simple: Woocommerce has style. I like it.
Recently Woo announced a price increase which caused a storm of comments from disappointed customers. They weren’t disappointed by the increase itself, but by the fact that they had bought what Woo called “unlimited” plans; use your theme on an unlimited number of sites and get lifetime support and updates. They now capped this to 25 sites and 2 years support for those existing customers who had already purchased the products based on the previous conditions. Now they would have to pay an annual fee for them instead. But that’s not what they bought, they argued.
Five days later, Woo announced that they had changed their mind about previous customers. If they wanted, they could now stay in the old plan with lifetime (of the theme) support/updates and unlimited use.
There’s a lot to say about this story, and much has been said. This is bad business on so many levels, and that’s why it gets to me. Of course, I’m also a customer, so I’m affected by these changes. I first commented like this under the first blog post:
I’m an entrepreneur myself and have raised prices on several occasions without any real complains – it’s part of doing business. But every time I’ve raised the prices, I’ve also given something back to the customers. For downloads I increased the resolution. For shipping I bought extra sturdy envelopes. Small investments but which left my customers with a feeling of the price increase making sense. That they were paying for something *more* than what they got before.
As I was reading your blog post, I kept waiting for that “more” to come. But it never came. I think that causes a lot of people to react (except from the discussed changes in terms for already purchased products). As for me, I’m a minor customer (1 theme, 1 plugin), so I’m more surprised than pissed off. I don’t think this is good business.
Indeed, that was my feeling when I first read it on their blog a week ago, and later in an email from them 12 hours ago. How would you react when reading the list of changes:
At WooThemes we love creating great products, providing awesome support and doing innovative things with the WordPress platform.
We’ve been doing that for a little over 5 years, and we’d like to continue doing the things we love for as long as we can. We have a great hunger to deliver happiness in the most authentic & innovative way.
For that to happen, we’ve made some important changes to our pricing and licensing systems.
Here’s what we’ve changed:
We’ve increased the prices of all of our products (themes, plugins & WooCommerce extensions.)
We’ve removed unlimited licenses and lifetime support from our offering.
We’ve implemented a consolidated licensing system (the one we’ve been using for plugins & WooCommerce until now), which now also includes themes.
Support and updates will be capped to one year after purchase (with the ability for you to extend this).
After your license has expired, you can renew that license with a 50% discount.
I maintain it’s very unusual that a company lists a bunch of changes which all mean a worse deal for the customer. Not a single “sturdy envelope” in there to be sure! As a customer one is left with the feeling: What’s in it for me?
When they backed from the first idea of changing the plans that previous customers had purchased, they demanded we “opt in” to the old unlimited plan, which irritated many customers since they had never opted out. When I logged in to my account at Woo and clicked on “Licenses”, I got this message:
Guess what I chose? The latter. I wanted the original deal – I did not choose to “back the new pricing model”.
So that’s the background. I’m writing this post because except all the obvious arguments – which are well covered in the comments to Woo’s posts – there are two things that still bug me in this story. I need to get them out of my head, but since Woo has already closed the comments on both their posts about this (maybe they thought that 492 and 175 of them was enough), I decided to write about it here instead. Here’s the thing:
1. It’s not a mistake, it’s business – deal with it
In their blog posts and in replies to commenters, Woo constantly refers to the previous pricing model being “a mistake”. Under the headline “Our Appeal For Support”, they write:
As we have admitted, we have made a real mistake in pricing our products and the business that we built around it. We only realized this about 18 months ago, as the effects of those mistakes have silently been chipping away at our business. 18 months ago the cracks widened and we noticed them for the first time.
The new changes are designed to right our previous wrongs and ensure that we never have to worry about this again.
You may as well turn that around: Would Woo even be one of the most popular commercial providers of WordPress themes and plugins if they hadn’t had very competitive pricing? What they are calling “a real mistake” might be the very thing that made them what they are today. That’s why people chose Woo instead of other providers. That’s how they got their “100,000 paying customers” as they put it on their frontpage. Actually, plenty of them write in the comments about how they spent a lot of time doing research before deciding to go for Woo.
And how can anything in a new and thriving company be called a mistake? There are no right and wrongs on the path from startup to success. But if there is success, you can conclude that there must have been many rights. Mistake, WTF? I’ve never heard a company use that rhetoric. Of course, as a business you make good and bad choices all the time. You experiment with pricing and you find the right level that will attract customers and at the same time give you a profit. It’s the same for everyone! Many companies don’t make a profit for many years but instead focus on building their customer base, then raise the low prices that were designed to attract many buyers. To me it seems that’s what Woo did. It’s not a mistake – it’s business. Stop whining.
2. Stop begging, it’s not becoming
The second thing that bugs me is how Woo expects its customers to be kind and “support” them. They continue their “Appeal For Support”:
So we call on all of you to support us in this regard and adopt the new pricing plan. By doing so, you will ensure that WooThemes stays around for a very long time.
You will also support our vision to really invest in innovation, as well as building out our support offering to the extent that we can give you insanely awesome support every, single time.
Again, WTF? As one commenter said: “I support you by being a customer.” And that’s exactly my point. This is not charity. This is business. If your company will grow, it should be because you do good business by way of providing great products to adequate prices – not because your customers are kind! There’s a saying that the right price in bartering is when both buyer and seller is a bit disappointed that they couldn’t get a better deal. That is the deal. The market price. In Woo’s case, that price might be somewhere between the new pricing and the old one, which some customers admit was an extremely good deal for them, but again, that’s why they chose Woo and helped the company become a big player. As long as you’re not down for counting (are you?), stop begging and start giving me reasons to spend my money on you!
Isn’t it amazing how something like this can keep you awake at night? I actually woke up at 4 am and realised I should get this out of my head. It’s now 5 am. Silly! But it is interesting. Because it’s spectacular. And I’m curious to see what happens. Many good comments about it under this post at WP Tavern too.