How our b2b startup got 240 paying customers in 3 weeks. Our experience of selling Lifetime Deal
The times when it was possible to create a useful service, wait for people to find it themselves and start using it, are long gone. Now companies spend a lot of effort, time, and money on finding new customers, engaging them, and collecting feedback.
I want to share the story of how we came up with a way to get more than 240 users interested in our product — those who invested in checking it out, figuring out how it works, and giving recommendations on how to improve the service.
LTD (Lifetime Deals) for SaaS services: what is it?
The mechanics of such offers is simple: the buyer pays for the service once with a significant discount and can use it without a time limit, while others would pay less, but every month if they want to use the service.
It is similar to a temporary promotion where you can buy a specific SaaS service, like a boxed software version in the good old days. In addition to the discount provided, there is a good chance that the SaaS service will only get better over time; at the same time, all changes for the user of the LTD plan will remain free of charge.
For their part, the owner of the service assumes that most of the customers will use it for a limited time (like if they were paying for several months at once). The idea behind it is similar to buying a fitness club membership: only in the case of fitness, the time to use the service is initially limited as well.
Why do services offer LTDs?
New SaaS projects usually lack customers. Most often, this is complemented by the lack of money for paid promotion of the service and the fact that the founders cannot devote all their time to the project due to the same lack of funding. In this case, LTD can be a great way to raise initial capital, which can be spent on further improvement of the service — provided that it is already good enough that the first customers want to use it. Also, LTD is a great way to attract enthusiasts and early adopters, get high-quality feedback and understand how to further develop and promote your service.
Our service is no exception. We are building a platform for increasing sales through video. We decided to publish the LTD for our service for collecting and publishing video testimonials on the businesses’ websites. We decided to start selling LTD as an experiment and then see what happens.
Which platform did you choose for a listing?
There are several platforms that can be used for listing a deal for a SaaS product:
We chose AppSumo due to its popularity and willingness to actively promote successful listings on its own platform with paid ads (they have fixed commissions from every sale and are interested in the promotion).
How to publish a listing on AppSumo?
At the time of publication on the site, the service has two options: publishing in AppSumo Select and self-publishing on the AppSumo Marketplace. What are the main differences:
AppSumo Select
All marketing for the listing will be done by AppSumo. They help to write a description of your product and record a good quality video with a person who will be explaining how good your product is and why people should buy it. They will also help promote your listing on their site. Most of the products on the main page of the service are listed via AppSumo Select. The only disadvantage of such an option is the high commission: the service will take 70% of the sale. For example, if you buy a product with AppSumo Select for $49, then its creators will receive less than $15.
AppSumo Marketplace
In this case, almost all marketing activities will be left to yourself. You won’t have the option to post a video on your listing, and you’ll only be able to offer one pricing plan. AppSumo will not be engaged in your marketing (excluding paid ads, apparently they do not separate products for this activity).
The main advantage of such placement is the reverse to AppSumo Select commission 30/70: the service will take only 30% for each sale.
Some of our competitors have already launched on AppSumo via AppSumo Select, so we decided to choose a different strategy and went to the AppSumo Marketplace with a noticeably lower price.
Why we decided to go for a Lifetime Deal in general
Even before publishing on AppSumo, we were well aware that we have a high-quality product and our main goal is to show our service to people who will benefit from it. AppSumo has a huge number of small business owners who are curious about new tools and ready to give them a try. So, we decided to take advantage of it.
At the same time, we work with heavy video files that need to be stored, converted, and distributed around the world, and because of it, we can’t afford to sell an LTD for a product with all the features that come with a regular subscription. As a compromise, we created a version that will satisfy most users but has little advertising for our service. Our LTD does not allow adding your own domain and there is a small message on the testimonials collection page that it is being collected using the VideoTouch service).
How can a product get maximum sales on AppSumo?
The main goal of the product on AppSumo is to get the maximum number of positive reviews as quickly as possible. With Appsumo Marketplace, the description space on the service page is very limited, and even adding your own promotional video is not possible. Given the high competition, most potential buyers go to the reviews section and, based on this information, decide whether to buy the product or not. Also, it is important to understand within 60 days after the purchase, a buyer can request their money back at any time. For example, out of 262 products sold, 17 were returned to us (6.4% of the total). Interestingly, we did not receive any complaints about our product. So my “go-to” version is these refunds were requested by customers who first buy and test the product, and then decide whether they need it or not.
The AppSumo platform itself conducts free promotions upon reaching the following milestones (the rating must be above four on a five-point scale):
5 reviews — mention in their Facebook group
10 reviews — publication in the Friday newsletter for 185,000 subscribers.
20 reviews — service is added to a section on the Rising Star Collection website.
25 reviews — publication in the Sunday newsletter for 210,000 subscribers.
So far, our product has received 15 reviews and got two out of four promos. We are still waiting for the first negative review, but so far, we are getting 5 out of 5 tacos from all reviews (yes, they decided to have tacos instead of stars. I like it way more!). The first free promo on the Facebook group didn’t help us much, but including in the newsletter resulted in increased customer interest and a few additional sales.
What do you need to get ready for when selling an LTD?
In my view, the main reason for offering an LTD is to get feedback for further work. And you need to be prepared for the fact that there will be a lot of it, it will be different and you should be able to react accordingly. The vast majority of platform users are people who genuinely enjoy checking out new products and giving feedback. It is worth being attentive to their feedback, but probably, there is no need to run and fulfill all the received requests. Otherwise, you can quickly find yourself spending days and weeks adding new functionality to the service but in the end, no one will use it.
We currently receive about 15 requests from AppSumo users every day through email, live chat, and the Q&A section on the site itself. Most of them are different questions about the specifics and features of the platform and about a third are direct requests for new functionality. Such feedback helps tremendously in defining our priorities and provides new ideas for developing the service.
Should a young project offer LTD for its users?
Our experience says that it is definitely worth it. One thing that is worth mentioning is that you should get ready for honest feedback from people who do not always fully understand the field in which you work, direct comparisons with competitors, and questions like why are you better than X service, why is your service so expensive, and whether you could make some extra features for a good review 🙂
New users who buy LTD will rightfully consider that they paid the price for the product and, moreover, supported the project at the beginning of its journey — and their expectation of loyalty to the first customers should be met.
If you want to follow our journey and check the progress of the company in real-time, consider following me on twitter.