The Price War

The Price War

Fresh off of our Zack Chase intelligence gathering session we realized we needed finally come up with firm pricing for our awards platform.

I felt the pain of a sales call last week for conference.  “So did you just come up with that number randomly?” — the truth was yes, but there was some awkward and noticeable backpedaling.  Timmy had just told the prospect that the price of our conference software was based on the number of attendees and the number of programs.  When both of those were halved, somehow the price still stayed the same.

The problem actually wasn’t the pricing — it was being confident and comfortable in how our pricing works.  I set a price floor of $4,000 for conferenceCMS.  We probably should have just told that to the client — “you guys fall into our minimum plan.”  Instead we tried to make them feel valued and it backfired.

Anyways — this motivated us to come up with proper pricing for awardsCMS.  Tim, Zack and myself all wrote out in a massive google doc some competing price plans.  Tomorrow we’re going to have a ‘meeting’ to try and square all of this away.

My opinion is that since we’re not putting prices on our website — we need a clear way internally to be confident about the pricing we give prospects.  More importantly we need to deal with a lot of the price questions that have come up.

Tim’s Plan

TIM S. – The Standard, see:

Standard (click here to sign up)Professional (call us)Enterprise (call us)
Yearly License Fees
Year 1 License Fee$3,000$5,500$10,000
Subsequent Year (30% off)$2,100$3,850$7,000
Features, Data and Support
Data Usage (video uploads)10GB500GB2TB
Themed SiteOptional add-on +$500includedincluded
Single Sign OnOptional add-on+$1000Optional add-on+$1000included
Multi Organization Rollup CompetitionOptional add-on +$3000/yearOptional add-on +$3000/yearincluded
Winners GalleryOptional add-on+$1000/yearOptional add-on+$1000/yearOptional add-on+$1000/year
AMS Data SyncOptional add-on+$5000 + $2000/yearOptional add-on+$5000 + $2000/yearOptional add-on+$5000 + $2000/year
SupportRegular24 hour response time through ticketsUpgrade to Elite for $1000.EliteDedicated Phone SupportOptional add-on +$1000/year per adminEliteDedicated Phone SupportOptional add-on +$1000/year per admin
Initial Contest ImplementationOptional add-on+$1000 per contest1 includedOptional add-on+1000 per contest1 includedOptional add-on+1000 per contest

Zack’s Plan


Base w/ a default template$3000 per year
Respond to ticket in 1 business day
Access to training documents / documentation
Unlimited submissions, unlimited programs that you can set up yourself


Theme$200 one time
Program Setup + Unlimited support$1000+ (est based on program size)
Streaming video$1000 per year
SSO$1000 one time
Role up w/ chaptersTalk to us
Public Vote$1000 per year
AMS Two-Way Data SyncTalk to us

My Plan

Price Discussion

We typically assess a fee to a client based on the complexity of their awards programs.  We work with you in good faith to ensure we have a clear grasp of your programs and then we issue a flat rate for the year which includes unlimited support and unlimited usage.

[[During the call you should have figured out the answers to most of the questions below]]

I can give you a rough estimate based on what we’ve talked about

– You have 2 major programs and get about 800 entries between both of them

– The entry forms for both programs are straight forward

– You have just 1 round of judging

– You don’t  get video uploads and really just 1 or 2 admins on your end

– That comes to a year 1 fee of $5,300 with subsequent years at a 20% discount.

“So…what if we get a lot more than 800 entries”

– As mentioned we take your word on your program size.  Your year 1 costs won’t go up.  If you get say 2,000 or 3,000 entries, then in year two we might ask for a modest fee, but we’d let you know way in advance.

“Can we use this system for other awards programs”

– Our policy is to give unlimited support to those programs we have discussed together.  Having said that, we don’t put on any restrictions, and many clients do end up using the system for a lot more than they originally planned on.  We are happy to answer basic questions on programs you have setup by yourself, but if you need the full service of our implementation team, we might ask for a nominal fee for other programs.  I think the key here is that there are no surprise costs and on the same note there are no surprise restrictions.

“$5,300 is over our budget, is there any wiggle room on price?”
“I’ll see what I can do, ….was there a high water mark”

“Yea – $4k tops”

—- next call—–

“I was able to get my manager to sign off on waiving the skinning fee, and taking another 15% off”  ($4,250).  Renewal fee would be $3,500.

Step 1: Tell us About your Competitions / Programs (See Pre-Contract Worksheet)

# of EntriesFirst 2500 included$1000 for each additional 2500
# of Entry Forms$500/each
# of Rounds of Judging$500/each
Public Vote$500 each
Winners Gallery$750 each

Step 2: Choose Features Needed

Basic Features$3,000
+ Streaming Video (waivable)$1,000
+ National / Regional / Chapter$5,000
+ Supported Admins (2 included)$1,000 each

Step 3: Any One-Time Add Ons?

SSO (waivable)$1,000
AMS Data Sync$5,000
SIte Skin (waivable)$300
AMS Data Sync Adjustment(varies $100-1000)

Step 4: Your Pricing

– Year 1 = Steps 1, 2, 3

– Year 2 = Steps (1, 2) with 20% discount

Pre-Contract Worksheet

Program / Competition# of Entry Forms# of Judging Rounds# of EntriesPublic Vote?Winners Gallery?

Some quick opinions
Tim’s plan: My opinion is that we don’t have the right kind of market segments to create plans.  With all the add-on options and with our sample size of clients always picking different combinations, there is no “Enterprise” plan.  Everyone is a Basic + or a Pro -.  I also don’t think we should put anything like this on our website.  No one falls into any of these buckets.  Tim highlighted Sitefinity, but my thoughts are that most people who buy Sitefinity  DO fall into a major bucket.

– Do I need load balancing: No — ok I can get standard, YES — I can get pro.  Do I need more than 5 concurrent users?  Yes – I need enterprise.  It is pretty clear.  With Tim’s it is always N+1 or N-1.  Not consumer friendly.

If we are to put something on the website — I would opt for a table like this.  Segment people by audience type, and give them an understanding of their starting point.  Not sure this is a good idea though.

Magazine / NewspaperCollect entries online for one or more contests.  Automatically generate and showcase winners in an online gallery.Starts at $3,000 | get a quote
BroadcasterForget about mailing DVDs with our support for streaming audio and videovaries | get a quote
Trade AssociationDitch the binders and run recognition programs and committee / board nominations onlinevaries | get a quote
National OrganizationAvoid the duplication of efforts.  Have chapters winners automatically roll up into a national competition.Starts at $7,500 | get a quote
ScholarshipSimplify the entry and selection process with a unified system for students and judges.Starts at $3,000 | get a quote
Corporate Grants / PrizesCollect entries and have a panel of judges review online.  Run a public vote to help select the top candidate(s).varies | get a quote
IT Manager / DIYRun unlimited competitions using our platform.Starts at $3000 | get a quote

My Opinion on Zack’s  Plan
It’s actually pretty similar to mine.  His emphasis is people should pay based on hours they consume.  My thoughts are that sounds like a consulting company, rather than a product company.  What happens in year 2 when they consume less hours.  His opinion is that means less support for us, so less time spent.  Might sound fair, but I think this is a flaw in the model.  We built a product and we service that product.  We should charge based on value given, not based on our costs — otherwise we’ll be stuck in consulting land forever.  Our markup is really based on the fact that year 2 has less support than year 1.

Tomorrow should be interesting.  3 stubborn people + Timmy + Marc to go over all of this.  I’ll report back on what we decided to try.


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