Pricing up a Piece of Software

[Malcolm Buggeridge]

Got a windows n app in mind that I'd bike to develop.

To help me consider its viability, I need to think about price.

Now, I ain't got a clue how to approach this but I should have thought that dev costs should be a factor along with potential savings to customer and potential client base. I mean if I can potentially sell to every Tom Dick and Barry on the planet then I can knock it out for next to nothing but if I only have a few hundred potential clients then the price tag will be higher.


When you have an idea for software, do you do any market resesrch to see if anyone registers any interest or do you just go in blind and suck it and see?

[wobbegong]

First thing to do is to check whether it already exists.

[Bunk]

You can't really justify charging people a lot just because you don't have many potential customers. They're only going to be interested in the benefit to them.

[Scrag Meister]

In my experience is this your idea or someone else's? Has a client shown an interest in you developing something?

I have found in the past to let the initial client pay for the development anyway, ensure that you keep the (c) in case it is marketable to a wider audience. At least then your costs are covered.

If you know that it is readily sellable to a vertical market then maybe you can give the initial client a good deal. i.e. cover your costs.

[jmo21]

First thing to do is to check whether it already exists.

This.

It probably exists already, much better than you could do it, with a cooler name than you thought of, all for 49p on the app store.

Hope that doesn't stop you trying though and good luck!!

[vetran]

Benefit + (if it saves them £100 a head over 10 heads ~ £100 if it saves them £10million = £1M)
Competitors prices - (if they are selling it for £5 its going to be a hard sell at £10)
Audience size +
Audience budget - (If its marketing put it up, if its local IT put it down).
credibility + (If HP or IBM put it up).
complexity +
Support level (if its best endeavours + email then cheap, if its 24*7 on site its more).

[NotAllThere]

I develop niche products. The list price is my usual daily rate x how long it took me to develop for smaller companies, 2.5x that for larger companies with more than a certain number of employees. The actual price varies considerably. I also sell yearly support licences which allow the customers to keep using the products and entitle them to updates. That's at a percentage of the price the product was sold for.

[VectraMan]

First thing to do is to check whether it already exists.

It can be better if it already exists as then the use case is already proven. Lots of software is crap, so coming up with a better version of an existing product isn't necessarily bad.

The good thing about software is you can pretty much create it with zero cost - i.e. you bashing away in your bedroom. Which makes anything you make profit, but obviously you need to factor in your time and lost earnings. I would say if it's something for business, you're probably better off with the high price / low volume approach as then you can go out and sell it, and you perhaps only need one client on the hook and you're started. If you want to reach a mass market, you're going to have to think about marketing.

[NotAllThere]

If you bash away in your bedroom too much, surely that's going to distract your from doing any actual work on your wonderful idea.

[Sysman]

It can be better if it already exists as then the use case is already proven. Lots of software is crap, so coming up with a better version of an existing product isn't necessarily bad.

The good thing about software is you can pretty much create it with zero cost - i.e. you bashing away in your bedroom. Which makes anything you make profit, but obviously you need to factor in your time and lost earnings. I would say if it's something for business, you're probably better off with the high price / low volume approach as then you can go out and sell it, and you perhaps only need one client on the hook and you're started. If you want to reach a mass market, you're going to have to think about marketing.

It depends on the target market. When I looked at releasing something back in the nineties I came up with a price of 5-10 quid, that being the level at which I would buy useful little utilities myself without blinking. This stuff was developed during boring evenings away on contract and at weekends, so the costs were minimal.