Why The Hell Do We Keep Changing Our Pricing?

FullContact Raises Series A
Ben Deda

Author: Ben Deda

@ben_deda

This is the question our customers have been asking us over the last three weeks. FullContact introduced a new basic plan for $99, then reduced the number of free API calls by 75%, then reduced our prices by more than 5X, then added a $19 plan and even an Unlimited plan!

Seriously…who the f*#k does that?

Well, we do. And here is why we did it.

As I heard from Aaron Batalion down at SXSW, “don’t hate, iterate.”

We needed to iterate.

FullContact initially introduced pricing based on established norms in the data industry. This is an industry in which contacts sell for $.10, $.20 or $.75 per based upon the quality of the contact. It’s an old industry that has been selling leads and contact info for a long time and is very comfortable in this model.

Unfortunately, this model is dying.

Data is cheap. And it’s getting cheaper. That is the world we live in. Every year the cost of data goes down. Anyone who tries to monopolize data (hello music and movie industries) ends up losing. The power now lies with those who know how to use the data or can serve it up with a great user experience.

That’s where FullContact comes in.

We had to make a decision. Are we going to play by established “data industry rules” or are we an API company that’s going to serve developers?  Sure, we had customers who would happily pay our prices. But, we also had a ton of feedback from the developer market that there was no way their end users would pay a huge premium for our service.

FullContact made a choice.

We are an API. We are the folks who know how to take all of that data and actually provide a service that is of value.  Sooner or later everyone will find the data. It is those who can collect, collate, analyze, and serve up that data with a great UX that provide the real value.

Correspondingly, our prices needed to be set correctly so our customers could incorporate our API as a feature and not an entirely new premium offering.

Guess what Old Data Industry?  The winds are changing. In today’s world, the value is no longer purely in the data. FullContact realized that and adapted.

Improvise, Adapt, Overcome.

Check out our new pricing, sign-up for an API key, and get started today!

  • Gregg Cochran

    Nice post Ben. You guys are rock stars at Full Contact and doing it right. Grab the market by the horns and hold on. While others are resting on their “old school” prices and models, I believe you guys will continue to grow rapidly as so many developers use your API to make their platforms come alive with social data. Keep up the good work! Oh, and I love the Mike Tyson Punch-Out graphic. Takes me back in time….. :)

  • http://twitter.com/Ben_Deda Ben Deda

    Thanks Gregg! You have to price your product at what the market is willing to pay for it. And the markets are shifting drastically right now.

    Yeah, I’m on an 8 bit kick right now. I might have to go find some Metroid to get it out of my system.

  • some data guy…

    Up, Up, Down, Down, Left, Right, Left, Right, B, A, Start, Start.

    If you know what this is, you probably know the “old” pricing models this article refers to.
    The “Cheat Codes” change, but wanting unlimited ammo and/or lives doesn’t.

    Data has no “Cheat code”, and yes it is cheap, but iterating a value based data pricing model isn’t about the customer spending less, it is about increasing the value for the price…otherwise you are winning the race to the bottom.

    I agree that the value is no longer purely in the data. However, even though the price is the same, that doesn’t mean the total value stayed the same.

    This is not revolutionary. Instead of upping the value you dropped the price? It seems like the right thing to do (get price in line with value), but not sure it is adapting or overcoming anything.

    • http://twitter.com/Ben_Deda Ben Deda

      Great to see the Contra code out there Dan. Completely valid point. And it’s why the value is added in how the data is served up (user experience) and who you can reach with it. I wouldn’t say its a race to the bottom. It’s an understanding that what used to be a scarcity is now a commodity. But you can still gain value in a commodity if you provide it to the customer in a way they value.

      The improvise, adapt, overcome is an old mantra in the Marine Corps. When you come up against an obstacle (in this case our market’s resistance to our old pricing model) don’t just keep doing things the same way. Improvise, adapt your technique (in this case our pricing), and overcome the obstacle (our market’s refusal to see enhanced contact data as anything but a service for their customers).

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