I think you might be leaving some money on the table in terms of the pricing, though-- I imagine that heavy users would be willing to pay more than $19/month for the "Unlimited" plan.
Please don't undercut your competition on price. I remember a quote by Tony Wright (of RescueTime) where he said that "Getting traffic on and off is okay but for a business to survive, it needs a predictable source of potential customers and leads". If you are selling your service for $19/month, you will be forced to keep your cost of acquiring new customers less than that. Which of course means less budget for marketing.
Note that mockups is not something that can go viral, so your marketing costs will linearly scale with every new customer. $19/month looks great if service is viral but for business apps like yours it can prove to be a growth bottleneck.
Rambling aside, suppose 6 months from now when the hype around the cool new mockup tool has died, how do you plan to get new customers? (Hint: whichever method you choose, chances are than you are going to pay for it and that will come out of your revenues)
It's nearly impossible to have a meaningful pricing discussion, because initial pricing is guessing. But it does feel like you may be leaving money on the table.
You (should) know your market better than anyone else, but be careful on competing with price. Competing with price is sometimes a crutch for actual marketing and a wishful shortcut in demonstration of value. Because, as mostly hackers, generally speaking we aren't great at marketing. And so, subconciously IMO what happens is we think "i'll let someone else market the idea with their higher price product, and then i'll swoop in with the cheaper offering".
Unfortunately, it doesn't work out that storybook. Markets aren't that transparent, and there is always an asymmetry in information. You're going to have to demonstrate real value and claw your way into relevance. So initially you will have to do a lot of "hand-to-hand combat" style marketing. And find key differentiators you can lead with that isn't price.
How about pricing it at $49 and then running a promo for initial new users? First 100 customers get it at $19?
As an aside, I spent $79 on Balsamiq last year. I think that is the most I've spent on software in the last two years (I stick with mostly open source / freeware). But it was a no-brainer for me... their marketing materials convinced me that the ROI was there. The value for me was probably much higher, but past $99 you enter some psychological pricing barriers.
Great points. But, of course, the other side of that is you charge too much for a product out the gate that no one's willing to pay for, there's no hype at all and you lose the motivation necessary to make it worth paying for.
Then again, I'm really glad Mocksup appears to be worth this discussion. Since this is a side-project for both of us I'd much rather you guys fuss at our pricing then just about anything else!
To be fair, $19/month only means that the cost of acquiring a new customer must on average be less than the current value of $19/month multiplied by the average time a customer remains a customer (at that price point). Obviously that can't be known on the front end, of course. Any thoughts on what a reasonable customer acquisition cost is for a service like this?
Not always. Reducing the price on a subscription-based product like this can make the early adopters feel like suckers-- whereas it's easy to grandfather them in on a raise in prices.
How do you feel about retroactively applying the new, lower cost to early adopters? I'm on the verge of doing some extensive A/B price testing and plan to do this with any users who buy at a higher price.
I think this is one of those products where a combination of one-off and subscription pricing makes a lot of sense. This lets you raise subscription prices significantly while still keeping a way to get some money out of customers who're scared of monthly subscriptions. It also makes for a fantastic upsell position when you can tell a returning one-off customer how much they'd save by getting a subscription.
I think you might be leaving some money on the table in terms of the pricing, though-- I imagine that heavy users would be willing to pay more than $19/month for the "Unlimited" plan.