- Steven Cravotta
- Posts
- This pricing mistake cooked my app
This pricing mistake cooked my app
Hey there,
When I wanted to push PuffCount's revenue up, I did the obvious thing:
Charge the yearly plan upfront and get the full $60 on day one instead of waiting on $9 a month.
On paper it was a great idea. More cash AND collected faster.
But then the refunds started rolling in…
Users would pay for the year, open the app, and decide it wasn't what they pictured.
Then they'd go straight to Apple for a refund.
Sure a few refunds are normal but they became a real problem this time.
That’s when I realized Apple watches your refund rate.
Once mine was moving toward 10%, I could feel my account moving into dangerous territory.
No successful business should have a 10% refund rate.
To fix this I had a simple idea:
A 3-day trial before the yearly purchase.
Same price in the backend, but users can try the app before they get a real charge.
Long story short, my refund rate dropped from nearly 10% to around 3%.
So yes, people will pay a premium for your app if they can try it before.
Let them feel the value first.
Happy user. Good relationship with Apple. More revenue.
Peace,
Steven