Auto-renewable subscriptions: Good or bad idea?

Hi everyone,

I am putting the finishing touches on a productivity app. I am thinking about monetizing the app through auto-renewable subscriptions although I have been unable to completely sell myself on the idea.

Some Advantages:

  • Recurring revenue on an annual basis.
  • You do not need to hold back major features for paid upgrades (2.0, 3.0, etc.). You can release them as they are finished.
  • You also do not need to concern yourself with how to handle paid upgrades (new app?, in app purchase?, etc.)

Some Disadvantages

  • Some users still may be turned off by subscriptions even if the annual price is relatively inexpensive (Say $15 US a year).
  • Productivity apps are allowed to make use of subscriptions (Ulysses, Bear Pro). However, “ongoing value” (see below) is a bit vague in regard to this type of app and there is no guarantee that the app will be approved.

3.1.2(a) Permissible uses:
If you offer an auto-renewing subscription, you must provide ongoing value to the customer, and the subscription period must last at least seven days and be available across all of the user’s devices. While the following list is not exhaustive, examples of appropriate subscriptions include: new game levels; episodic content; multi-player support; apps that offer consistent, substantive updates; access to large collections of, or continually updated, media content; software as a service (“SAAS”); and cloud support.”

What do you think? Good idea or bad idea?

Thanks.

It sounds like you’re asking for business advice and not so much about iOS…

Apple is just concerned that their customers get the best experience. So of course they’re going to ask for ongoing value. But that’s how a SaaS should be!

As for whether or not auto-renewing subs is good for a productivity app… Look at solutions like Adobe CC, Evernote, and Dropbox.

Those are all productivity tools that require you to pay (albeit for varying degrees of access, but the point still stands).

So as long as you’re actually providing a value to the customer, even if it’s simply them using it every other day, that’s what’s important.

Remember, with pricing, it’s PURELY about how much value does the CUSTOMER get out of it, then charge less.

Regardless of how much it costed you to make it. Regardless of ongoing maintenance fees or support costs.

You have to price your product less than the amount of value you give.

If you can’t afford the costs given your pricing model, you need to up the price.
If your price can’t go higher because you don’t offer enough value, then you need to offer more value.

Simple as that.

Whether it’s SaaS, cost-per-product, ad-supported, coaching services, or whatever… doesn’t matter. You just have to add value. THEN charge less than the value you’re giving and customers will be happy to exchange their money with the product you have.

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