Our apps all have seat-based plans where if you have 5 seats of monday.com, you need match the number of seats for our apps.
Scenario
Customer has 5 seats of monday.com, so rightly the “Up to 5 seats” plan was purchased. Several months go by and all is good.
Current behaviour
The customer then expands, so now has 10 seats of monday.com, but they continue to have the old and inadequate “Up to 5 seats” app plan.
As our app has logic to check for the correct number of seats, it displays a message about the app plan size being inadequate.
Expected behaviour
The customer then expands, so now has 10 seats of monday.com, so the app plan automatically updates to the correct seat based plan of “Up to 10 seats” (or whatever the next largest plan would be). The app just continues to work correctly.
Questions
Are other vendors aware that this is happening?
Are monday.com aware that licensing is not behaving correctly?
i.e. it does not track monday.com seats for seat-based app plans
It would be great if monday.com handled this automatically on plan upgrade instead of developers having to reach out to customers to upgrade their plans.
By the way, I think seat-based pricing is a great way to price an app, even though most apps don’t use that pricing model.
Agree that it would be ideal if monday would automatically require the customer to upgrade their app plan at the same time that they upgrade their parent product user tier.
This would be a lot easier (to enforce and for customers to understand) if seat-based plans for apps were structured the same way as monday’s seat-based plans. Currently, apps with seat-based plans all have unique user tier buckets (confusing for customers), which don’t match the user tier buckets available on monday’s products (still more confusing for customers). For example, if an app has plans for 1-100 and 101-200 users, and that customer upgrades from 100 to 110 monday users, it’s a tough message to then tell them they must upgrade to the 200-seat app plan.
In short, marketplace app sales would grow faster if the buying experience for apps was more closely aligned to the buying experience for monday in terms of both user tiers available and upgrade processes.
It is what we are used to if coming from an Atlassian background. tier sizing for apps matches the tier sizing for Atlassian.
the plus is customers get used to always matching the tier size of app and monday.
however…
there is a downside to this - there is pressure in Atlassian world on this model when it comes to apps. similar reasoning - people dont’ like to pay for 100 seats of something if only 5 people are going to be using it.
monday.com is different.
We don’t have the precedent set with users strongly. we don’t have either the benefit or burden of 20 years of history.
The market has different users and personas.
monday.com has both feature based and seat based monetization available to us. That is already different to Atlassian.
Do we really want to choose to do as Atlassian did ? rather than debate it?
the two models of
app matches platform seats
app seats are separate.
e.g. take pricing of, say, a test management product (something we dont have). if genuinely per seat rather than for all licensed seats the vendor might just charge 10x .
the following made up example can end up the same price to the customer:
if app matches platform…
100 users platform - pay for 100 users app. = say $100 per month. $ a user.
100 users platform - pay for 10 users app. =. say $100 per month at $10 a user.
the difference is… the second model is closer to the salesforce model. in that case we can get “expansion” revenue as an app vendor on monday. under the app matches platform model our best retention scenario is 100%. not the 125% or more that you can see with expansion in an account.
edit:
Holly - there is another way of looking at this based on the other SaaS platforms monday users use.
you could make the case to follow the precedent on other platforms rather than what Atlassian have done.
i.e. align buyer experience more with hubspot, salesforce or the like?
in which case this may instead be true:
In short, marketplace app sales would grow faster if the buying experience for apps was more closely aligned to the buying experience users expect and are used to in the other platforms they use.
App discounts are another thing that can make upgrading a seat-based plan tricky. Right now, I have to manually keep track of the accounts who have a discount applied. Then if they were to upgrade, I have to apply the discount to the next level tier(s) as well.
It would be great if, for seat-based pricing, we could apply a discount for all tiers at the same time.
This is THE BIGGEST BLOCKER to building a sustainable business on monday.
I don’t mind if the monday team drops everything else and focuses on aligning billing systems to buyers expectations
I have a large segment of users who use our mind mapping app during the trial period, but don’t upgrade when they see that they have to pay for everyone when only 1-2 team members are using it.
There should be an option to explicitly add team members to an app and pay for those users.
Though if monday.com did add the ability to purchase an app for only a few users in an account, I still wouldn’t want them to remove their current user-based pricing model. Their current user-based model is excellent for apps that want to price based on the account size.
Larger accounts tend to have more resources to pay for an app, whereas smaller ones aren’t able to pay as much. The ability to price an app by the max number of seats in an account is very useful.
@kranthi_thoughtflow For the mind mapping app, would you be able to change the pricing to a usage-based model, where each tier includes a certain number of mind maps? That way, for accounts that make a lot of use of the app, they would end up paying more?
Hey folks, great discussion here. What you’re describing is a feature not a bug, I’m afraid.
To be transparent, we don’t have plans to auto-upgrade users when their account size grows. We also have no plans to release monetization by “active users”.
Currently we’re focusing on giving y’all more tools (eg analytics) to understand how people use and convert to your app, and to get people to try your app more.
Side note, @kranthi_thoughtflow - have you considered making tiers based on the complexity of the Birds Eye View?
EG: you can have a free tier that allows 1-2 levels of hierarchy (allowing people to understand what the app does), next tier for up to 10, pro for up to 50, and then unlimited?
That way people can get some value from a free tier, and then upgrade as their usage becomes more complex.
Thanks for your feedback on this, @dipro. Just to make sure, is it expected for app developers to reach out to their seat-based customers as the maximum number of users in their accounts grow over time? That would make sense to me, since oftentimes the size of the account is linked to the running costs of the app (larger accounts use more server resources).
For example, a customer purchases an app for a year, but midway through the year, the number of seats in their account increases, so that they’re over their current seat-based subscription limit. Then it’s expected for the developer to reach out to the customer and request that they upgrade their subscription, right?
Hey @dipro - That’s a very interesting idea. But in our case, typically the number of tiers is dependent on their use case, and does not increase with usage.
For example, if someone is using it for OKRs, they would have Objective > Key Results > Initiatives > Tasks which is four levels.
If they are mapping product requirements it would look like Feature > Story > Specification > Test case
Typically, the number of levels don’t change as the adoption increases across the organization.
What increases with time is - number of users seeing this, number of boards, number of dashboards, number of items etc. A good pricing model would enable us to grow as we create more customer value along these multiple dimensions.
For example:
Basic - 3 levels, 3 boards per dashboard, 2 dashboards - 3$/user/month
Premium - 4 levels, 6 boards per dashboard, 4 dashboards - 5$/user/month
Advanced - you get the gist
The current pricing models offered by monday considers only one dimension for monetary growth, which is quite restrictive.
To put it in terms of what’s available today, you want – per-user pricing, usage based pricing, AND to combine them both. So it’s 3 additional layers of flexibility you want from our monetization.
