Timid pricing was no good. The saying "You can be the cheapest or you can be the best, but not both" is very true.
In early 2000, I accepted a job with TurboPower Corporation and received another very good lesson in pricing. This is out of chronological order, but I'd like to explore this area a little.
TurboPower was one of the biggest, if not the biggest, provider of third party libraries and utilities for Borland Delphi. We sold to other programmers who used Borland Delphi or Borland C++Builder.
The product quality was higher than my own. And the pricing reflected that. Again, it was sold as one license per developer. Run time distribution was free. Technical support was free and you could have direct contact with the developers through newsgroup and telephone.
We sold a lot of product but we begrudged the user the price they paid.Why didn't we feel like we were getting paid for what we provided?
Because we weren't. Sell a license once and then hope for upgrade revenue in another 6 months to a year. But expect telephone calls and newsgroup questions that you said you'd handle, at no cost to the customer.
The majority of customers did not take advantage of this and were very pleasant to deal with. The begrudging comes in when you run into those few that expect you to bow down before them for the rest of their life, after they've paid you $349 for a license.
How long before that rubs you raw? How much time do you have to spend on free support, putting off work on advancing your products, before this unpleasant mood sets in?
Maybe the number of products involved is part of the answer?