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Ask HN: How do you decide whether to charge for your product from day one?

8 points by ashok_varma ↗ HN
We are building a product that we know is very useful for our customers. We have a few competitors but they are not charging for their service yet. They also have users who are actively using the service.

8 comments

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dirkdeman
Ask yourself this: what sets you aside from your competitors, i.e. What's the reason why people would choose your paid service over the free one of your competitors? It's about the added value of your service or product. Define that and you're closer to your answer.
ColinWright
If you are still building your product, you don't yet have "customers." If you haven't charged them money, if they haven't paid, then you don't yet have "customers."

When someone pays you, they are a customer.

Perhaps you have potential customers. How do you know that what you're building will be very useful for them? What will you have that will make them pay you, and not simply use the free service your competitors are offering?

I would say yes, you should charge, from day one. Then you need to find your first true customer. Make them ecstatic about the service they get. Then find another 4.

Then you have a product, customers, and the thin end of the wedge. If you can't do that, how will you ever make money?

ashok_varma
Our product is similar to them but not the same. We both are trying to develop solutions to the same problem and trying to find the product market fit. Since they are not charging for their service and we are, do you think it would effect our chances of finding product market fit. Do you think we are making it harder for us to find product market fit.
ColinWright
I have no way of knowing, I've just tried to provide you with a more concrete place to start.

Find a customer.

Go and talk to someone you think has the problem you're trying to solve. Find out what they do now. Show them your solution. Get their reaction and build on it.

Sell your product.

This is hard work, but unless you actually sell your solution to someone, anyone, you won't know what your fit is.

Find a potential customer and talk to them.

glimcat
If the value of your product is not directly tied to the total number of users, charge for it.

If the value of your product is directly tied to the total number of users, charge for it some of the time.

ashok_varma
Could you give me an example of both types of product please. It would help me think about it better.
glimcat
Think about LinkedIn vs. Bootcamp.

LinkedIn, a lot of the value comes from there already being lots of other users when you sign up. Further, a lot of their revenue model is based on selling user attention to advertisers and recruiters. Having users is more important than charging the individual user, although it's still nice when you can convince them to pay up.

Bootcamp, it doesn't matter for crap to the individual user if others are also using it beyond social proof to justify trying it.

colin8chSE
"product that we know is very useful for our customers"- For some businesses this can become obvious from metrics like signups and usage- although there is a difference between a "user" and a "customer". Linkedin is a good example by glimcat.

If you want to build a BUSINESS that has a "product that we know is very useful for our customers"- To have a business you need customers, customers pay, and paying customers validate that the product is useful to them, otherwise you just don't really know.

If you would like to start charging from day one with the minimum of time and effort, if you want to get to market ASAP and gain traction fast- check out Simplified Ecommerce. I'm the Founder.

http://promo.simplifiedecommerce.com/killer-startup