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    Update on Pricing from Miva, Inc.

    I'm going to close the current thread that's running on pricing (as it's gotten long and hard to navigate, but it'll remain up for posterity and this one can become a new one if there's more meaningful discussion to have on the subject).

    I'll sum up everything that's transpired since the announcement last week:

    1. We screwed up on "small merchants". Roughly speaking those doing sub $10 - $15k a year in online sales. We're working on a new plan for them and are making exceptions for them in the meantime.

    2. Anyone who asks for a pricing review can have one, it might take us a couple days to review their site and get back to them but we're looking at sites individually.

    We're going to be reviewing our tiers to make sure we split them up correctly, if we "missed the mark" we'll adjust.

    The main takeaway I want people to take from this discussion is really two things:

    1. Pricing based on Disk, Bandwidth and Seats isn't really feasible in the big picture (we hoped Seats would fix this, but they ultimately did not) since especially Disk and Bandwidth are a minuscule part of our overall cost to provide a robust software platform.

    We're not asking people to blindly accept these changes nor are we asking them to just "take it", we are however asking them (if only for a moment) to understand Point 1 and be reasonable in the dialogue (and the vast majority have been).

    2. Our goal here has always been to price to market and I strongly believe that on average we're far closer to market pricing with our new model than most here realize. Many of our customers have been exclusively in Miva-land for a very long time and do not understand the true cost of ownership unless and until they actually use a competitive platform.

    Now with that said, I am also 100% certain that there's no way to make an adjustment like this and get it 100% right and price everyone "perfectly", so anyone who asks will get a pricing review. Our only request on this is to allow us a few business days to work through it.

    In essence we're trying to get a fuller view of the market and are taking into account our customers unique businesses and experiences.

    For anyone who is either a very small merchant or just in general wants their pricing reviewed they should reach out to me via email. We have an internal process for going through these and it’ll take a couple days.

    My email is [email protected]
    Thanks,

    Rick Wilson
    CEO
    Miva, Inc.
    [email protected]
    https://www.miva.com

    #2
    Re: Update on Pricing from Miva, Inc.

    There is one "Frequently Asked Question" that I'd like to address as well.

    Far and away the most common question that has come up is this:

    Why is using top line revenue as a proxy to determine price fair?

    It's actually fairly simple.

    Two of the most commonly requested/expected things from our client base are essentially 100% uptime (or as close as humanly possible) and stable upgrades/quick bug fixes.

    If you're a merchant doing $10k a year in sales if we're down for 8 hours or even 5 days like BigCommerce was earlier this year, it's not going to fundamentally put you out of business.

    However, if a $10 million merchant is down for that long, one of the first emails I usually get is essentially "what are you going to do for me since you just cost me $x thousands in sales".

    While we don't compensate for lost sales (as that would be both impossible and suicidal) we do spend a disproportionate amount of our resources on this type of activity which also directly benefits the much larger merchants on our platform (it's why in my opinion we have the most number of Enterprise merchants in the market according to BuiltWith).

    Second is a similar line of thinking but for a bug fix or update that doesn't break your store. If you have critical functionality that's either already broken for whatever reason or breaks during an upgrade, a small merchant can live with those, but our large merchants don't want to wait weeks, months or years for a bug fix as it's costing them real revenue via lost sales.

    Same is true for an upgrade that breaks your store for days and it's the most common horror story we hear about both Magento and open source carts in general.

    So in both cases you're talking about huge internal expense that is impossible to recoup via Disk, Bandwidth or even Features (I can't realistically charge an uptime premium or for bug fixes).

    I'm not arguing the top line revenue is a perfect metric, I'm not even arguing that it's fair. I'm simply making the case that it's a reasonable metric to use for those two items along with many others like that.

    If I had a perfect metric for charging customers I would use it, but we're not a commodity like Oil or Pork Bellies, we're a highly advanced software solution based on intellectual property that powers people's business and we're still trying to solve a fundamental problem of how do you offer such a product to people who are both small and large and price it correctly.
    Thanks,

    Rick Wilson
    CEO
    Miva, Inc.
    [email protected]
    https://www.miva.com

    Comment


      #3
      Re: Update on Pricing from Miva, Inc.

      It sounds like this discussion has been going on for some time now but this is the first that I have heard. I am paying Miva $500/month for a dedicated server and an extra seat for our consultant and apparently you want more from me. I am also paying developers about double or triple that every month to remake Miva into a store that suits my business. Every time you reinvent Miva with a new release that cycle of developer expense begins anew. I am sure that every Miva merchant has a similar sad story to tell.

      I never received a letter or even an email about this and I have not been active in the forum lately so I guess that's why I didn't get the word. Now that you are starting a new thread on this topic maybe you would be good enough to publish the new rates that you are proposing.
      Bill Dunn
      SunCam, Inc.
      http://www.SunCam.com
      [email protected]

      Comment


        #4
        Re: Update on Pricing from Miva, Inc.

        Originally posted by SunCam View Post
        Now that you are starting a new thread on this topic maybe you would be good enough to publish the new rates that you are proposing.
        Here's a link:

        http://www.miva.com/miva-pricing-update

        Also read the Miva Competitive Market Analysis

        http://www.miva.com/miva-competitive-market-analysis

        And reach out to Rick.
        Leslie Kirk
        Miva Certified Developer
        Miva Merchant Specialist since 1997
        Previously of Webs Your Way
        (aka Leslie Nord leslienord)

        Email me: [email protected]
        www.lesliekirk.com

        Follow me: Twitter | Facebook | FourSquare | Pinterest | Flickr

        Comment


          #5
          Re: Update on Pricing from Miva, Inc.

          Ouch! A 50% increase for me from $500 to $750. I'm a one person company so I obviously don't need all of those seats and I only need about 1GB of disc space. Big shoes for a small foot. Qué lástima!
          Bill Dunn
          SunCam, Inc.
          http://www.SunCam.com
          [email protected]

          Comment


            #6
            Re: Update on Pricing from Miva, Inc.

            Rick, please tell us the gross sales and margins for Miva.
            Chris Dye
            http://www.kseriesparts.com

            Comment


              #7
              Re: Update on Pricing from Miva, Inc.

              Rick,

              You say that pricing based on disk, bandwidth and seats is unfeasible but give no evidence to back up that statement.

              In order to make that case credibly, you need to be transparent and explain how much Miva is making currently and why it
              is fair to increase rates for companies like ours from $160 per month to $1450 per month with less than 30 days notice
              (we just received the email today saying its effective on 11/1). Miva has been making plenty of money off the software,
              hosting and design/development services under the existing pricing. The fact that your agreement allows you to do it
              with 30 days notice doesn't mean its reasonable.

              We already absorbed a 300% price increase last year when you started charging for "seats" and we added 3 to meet our needs. For the record, we don't use Miva hosting so you are now charging us $1450 per month just for the software license. That is
              $17,400 per year which is an increase of 900% or $15,480 annually. This is completely unfair and unjustified and its not
              "market pricing" as you claim.

              We have invested many hours customizing Miva to meet our needs. We haven't asked for anything from Miva so the
              implication that larger customers are using all the resources simply isn't true. If you want to increase pricing 900% for
              those needy clients who are placing demands on the company, go ahead but we don't deserve to bear the brunt of this
              price increase. Small companies go from $40 to $70 which is a 75% increase but a company like ours gets to pay 900% more?
              You definitely missed the mark here.

              Eric

              Comment


                #8
                Re: Update on Pricing from Miva, Inc.

                Rick, are shipping charges and sales tax included in your gross revenue total? Using the current stats on the admin home page, shipping charges over the past 3 months are about 18% of gross sales. And shipping is not a profit center for us.
                Last edited by wajake41; 10-07-15, 07:49 AM.
                Larry
                Luce Kanun Web Design
                www.facebook.com/wajake41
                www.plus.google.com/116415026668025242914/posts?hl=en


                Comment


                  #9
                  Re: Update on Pricing from Miva, Inc.

                  Larry,

                  It's my understanding from having read the posts on the previous thread that Miva is including everything in the gross revenue figure they're using including tax, shipping etc.

                  They're subtracting out cancellations, returns, credits etc.
                  www.kicks-ind.com
                  www.comp-n-choke.com

                  Comment


                    #10
                    Re: Update on Pricing from Miva, Inc.

                    Eric S,

                    The statement seems obvious to me and I explained it further in detail in my second post.

                    We spend roughly $150k a year on Disk Arrays and we spend approximately $500k a year on bandwidth.

                    However I spend multiple millions on product development, hosting infrastructure, and support.

                    It should be obvious to anyone who's used our product that Disk and Bandwidth don't have anything to do with uptime, seamless upgrades, high security and new features.

                    We're a privately held company and I'm certainly not going to turn this into a circus by posting our financials and having people chime in on them.

                    I can say this, while we're profitable we for all intents and purposes reinvest 100% of our profits into the above items along with sales and marketing.

                    Our competitors on the other hand have the "privilege" of losing millions of dollars per month each while having inferior products.

                    This makes it an interesting challenge to solve on our part for a number of reasons.

                    First we do think that when the Venture Capital/Private Equity market money becomes harder to get, at least 3 of those 4 companies I'm referring to will be in a lot of trouble, so we certainly don't want to try and raise money and chase them down a rabbit hole.

                    Second, we've studied very deeply what it takes to build equivalent stores on those platforms and frankly on average our pricing has been too low.

                    Now with that said, that is dependent on a number of things and it doesn't apply equally to all customers (which is why I said on average) and precisely why we're doing one on one reviews for anyone who asks.

                    So I'll repeat what I've said above a number of times.

                    We made a mistake on the small merchants and working on a new plan for them, they should reach out for now to be manually adjusted.

                    Second, we understand that there are use cases in which our logic doesn't add up and we're also reviewing those, just email me.
                    Thanks,

                    Rick Wilson
                    CEO
                    Miva, Inc.
                    [email protected]
                    https://www.miva.com

                    Comment


                      #11
                      Re: Update on Pricing from Miva, Inc.

                      Suncam,

                      If you haven't been contacted then it's plausible there's no change for you, or you're one of the 200 or so special cases we're holding back on.

                      In no case should you get a surprise bill though, feel free to email me off forum if you want me to look into your account specifically.
                      Thanks,

                      Rick Wilson
                      CEO
                      Miva, Inc.
                      [email protected]
                      https://www.miva.com

                      Comment


                        #12
                        Re: Update on Pricing from Miva, Inc.

                        1. We screwed up on "small merchants". Roughly speaking those doing sub $10 - $15k a year in online sales. We're working on a new plan for them and are making exceptions for them in the meantime.
                        I believe you screwed up even worse on small businesses who require relatively limited resources (few seats, less storage) which gross 100K+. MIVA has basically cut off the spigot on new entry and mid-level customers who will run away when they see what they are to be charged if they gross 100K+, 500K+, etc, And now MIVA is set to lose customers with this new pricing strategy. Meanwhile the new competitor enterprise options will very quickly become good enough to retain their move-up customers and thus basically cut off the spigot from business which would have otherwise outgrown them.

                        Rick, are you able to share with us where MIVA is headed in terms of positioning itself in the market? If MIVA goes under will we get more than 30 days notice? What do the TOS say?

                        Based on your response from an earlier post in the other thread... Rick you have posted more on the forums than anyone, you have a ton of experience on these boards, and you are the face of this company, you know not to respond like you did... you must be under a great deal of pressure. I wonder if the end game is much closer than any of us had thought? You have to deny of course regardless. So please take the opportunity to share the direction in which you think MIVA is headed and with what segment/s you hope to remain competitive. I'm concerned! This pricing seems suicidal and the 30 days notice is not reassuring moving forward.

                        Comment


                          #13
                          Re: Update on Pricing from Miva, Inc.

                          Selfhelp1,

                          I can assure you I'm not under any appreciable pressure and Miva is and was strong financially.

                          We believe our old pricing model is fundamentally flawed and we're trying in earnest to correct that and price to market.

                          I certainly occasionally get frustrated when someone I have a personal relationship with off forum takes shots at me or Miva on forum without giving me a chance to interact with them through private channels.

                          When I lose my cool, I'm the first to apologize.

                          As for where Miva is heading, our focus is merchants doing $100k to $10 million in annual online sales, this hasn't changed at all in recent times.
                          Thanks,

                          Rick Wilson
                          CEO
                          Miva, Inc.
                          [email protected]
                          https://www.miva.com

                          Comment


                            #14
                            Re: Update on Pricing from Miva, Inc.

                            We do a pretty sizable business (like Rick I won't post publicly what that is), but we don't host directly with Miva, so we will be contacting Rick to find out what our fees are going to be to determine if we are going to stick around after 15+ years.

                            With this mega jump in price, I want to know what plans are in place to add omni-channel functionality and other such enterprise-level features.

                            Comment


                              #15
                              Re: Update on Pricing from Miva, Inc.

                              Originally posted by morditech.com
                              Rick,

                              “We're a privately held company and I'm certainly not going to turn this into a circus by posting our financials and having people chime in on them” – Rick Wilson
                              Does that fact that Miva is monitoring each and every “privately held” company’s eCommerce revenue, tax, shipping and returns bother anyone, specifically when they are not willing to share their own information?
                              Just want to point out that every SaaS out there, along with the majority of standalone programs that sync to the web, track sales data. That's how Shopify, for example, is able to produce all those reports and infographics - the data comes from their customer base. Any service you use - for pretty much any purposes - is utilizing data to report trends and for understanding their existing user base.
                              Best,
                              Pamela

                              Consultant / Developer / Trainer
                              Contributing Editor to Practical Ecommerce
                              Author of the Official Guides for Miva Merchant
                              pamelahazelton.com

                              Comment

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