WooThemes has announced a major restructuring of their pricing tiers related to their theme and plugin products. First off, I applaud WooThemes for being transparent about the pricing changes and the reasoning behind them. From a business perspective, the changes make sense. From their announcement post:
- We’re increasing the prices of all of our products (themes, plugins & WooCommerce extensions.)
- We’ve implemented a consolidated licensing system (the one we’ve been using for plugins & WooCommerce until now), which now includes themes too.
- We’re dropping our Unlimited pricing tiers in favour of a 25-site license tier.
- Support and updates will be capped to one year after purchase (with the ability for you to extend this).
As expected, not everyone is happy about the changes, especially customers who purchased products that would have unlimited support and upgrades and could be used on unlimited sites. Those customers will be grandfather-ed into the new licensing system where they will receive 2 years of support and upgrades. After that time expires, they will need to renew their license. License renewals will have a substantial discount attached to them but if the license expires, you’ll have to renew at full price.
This change in the way they are doing business is no surprise to me. In fact, I thought this day would have arrived sooner. When I asked WooThemes employee Mark Forrester why this change wasn’t made sooner, this is what he said:
Our fast growth, varying product offering, tech and pricing models complicated things. But yes we wish we’d done it earlier!
From the outside looking in, it appears that WooThemes could definitely afford to honor their commitments to customers in the unlimited pricing structure but at the same time, that’s a huge chunk of recurring revenue they would pass up. What we’re seeing now is that WooThemes understands the costly mistake they made by offering unlimited anything and while they didn’t have to, they did give those customers 2 years to get accustomed to the changes. However, I can also see the perspective that customers will now have to literally pay for their mistake, even if it’s two years from now.
I know how it feels to pay once for something labeled as unlimited and then later on in the product’s life cycle, I end up having to pay again despite the fact that it was supposed to be a one time buy. The terms and conditions page of WooThemes affords them the opportunity to make changes that positively affect their business, even if the customer gets the low-end of the deal.
At the end of the day, WooThemes has made some necessary changes that will help cement the company’s existence well into the future.
As for all other theme or plugin shops, if you are offering unlimited anything, please do yourself and your customers a favor and stop it. It’s getting to the point that if you’re offering unlimited anything, you might as well be holding up a giant sign that says “Want To Go Out Of Business“.
Related reading from David Peralty on WordPress Products Versus WordPress Services