business model

Kevin Eklund who operates ToMuse.com published a thought provoking article the other day which has become yet another piece of this puzzle known as ‘How To Make Money Making WordPress Plugins‘. On the WordPress Tavern forum, this is a topic that we have been discussing in different incarnations for a few months now. Here are a few examples:

Kevin provides a few different statistic samples based on his discussions with some popular plugin authors and it’s easy to see that donations alone do not equate into a favorable business model for plugin authors. I’ve spoken with Michael Torbert who is the author of the top downloaded plugin on the WordPress Repository, All In One SEO Pack and he has told me that the amount he receives in donations would not be enough to make a living on. Kevin then goes on to provide some alternative business models that plugin authors can use to bring in revenue to support their work.

One suggestion that has been brought up a few times by different people is to turn the WordPress.org plugin repository into something like the Apple App store where plugins can be purchased for a very cheap price. Another option is to place a $1.00 required donation on all plugins in the repository. I understand how this could be a good thing as plugin authors would definitely make a nice chunk of change if everyone who had downloaded their plugin donated just $1.00 but if something like this were to be forced upon users, I can already see a number of people with pitchforks lining up to protest. But, if this were accomplished by someone creating an app like store completely independent of the plugin repository, I’m all for that.

One thing I don’t want to see happen in the WordPress ecosystem is something I remember from my days using Joomla. It could be vastly different today than a few years ago but I remember that whenever I wanted to do something cool with Joomla either through an extension or a theme, I had to pay for it. Usually a good chunk of change. In the end, this became a major turnoff as it seemed like so many cool developers were in it for the money. Money I eventually ran out of.

I can completely understand why plugin developers should be compensated for their time and effort. I’m not against that. I am against certain ideas on how this can be accomplished but they mostly pertain to anything dealing with the official plugin repository. The good news is, there are a few examples of plugin authors who abide by the GPL and who are making a living at it. Two of those examples off the top of my head are both e commerce solutions. Dan Milward of WP E-Commerce and Jonathan Davis with the Shopp Plugin. Dan has the free plugin available in the WordPress repository while Jonathan’s plugin is not. I’ve spoken with Jonathan about how well his business is doing and so far, it’s way above all of his expectations. I have not spoken with Dan but from the outside looking in, he is doing pretty well himself. After all, WP Ecommerce has been around a long time so he must be doing something right.

Over the past two years, there have been countless debates on trying to get commercial theme authors to align themselves with the GPL as part of their business model. It’s been a tough struggle but thanks to pioneers such as Brian Gardner, those folks are starting to come around. I really hope that we are not entering a new time period where the same debates regarding the GPL and themes encompass plugins.

I believe that the best model for plugin authors is the combination model as proposed by Kevin:

A Combination Model – This would entail using any combination of the models described above. For instance, maybe instead of selling the plugin outright, the developer draws on all the other plugin business models for sustainability (i.e. donations + ads + paid support + paid upgrades).

I think if plugin authors would use a bit of creativity, I think we’ll see some cool models spring up. I’m keeping my eyes peeled on how the guys at RocketGenius handle this situation with their upcoming Gravity Forms plugin. I have no idea if it will be a commercial plugin or not but if it is, it will be interesting to see how it all works out for them.

Your Thoughts:

You can add your thoughts on this issue either in the forum where we have a bunch of threads already created or by leaving a comment.

In the Tavern forum, I recently started a discussion thread around the topic of paid support models. The question I had on my mind was this, if you’re selling support packages for your themes, where does one draw the line in terms of giving away the whole thing or keeping certain things limited? On one hand, if you offer everything away for free and make the product easy to use and understand, you cut into your profit margins. On the other, is there a fine line that has to be walked between the two? Or does no such line exist? Here are what some of the community members had to say.

PaulCunningham – My feeling is if you’re giving away something for free and want to make some money offering support you should be making it easy enough that say 9/10 people could do it unassisted.

andrea_r – What Paul said. If someone has no trouble installing and using themes (for example) then you shouldn’t *need* to support them. The people you should be paid to help are the ones who have trouble installing themes, or wind up with weird errors.

itsananderson – Well, you have to walk a fine line there. On the one side you can provide something that only WordPress gurus can use in the hopes that others will come to you for support, or you can make your product so great that nobody ever needs help. I’d say in general you’re better off getting as many people using your plugin/theme etc. as possible. If a WP newby can’t get your plugin to work, they’ll probably just find another plugin. But if they can get it to work, but want some part of it customized, they’re more likely to hire you to do so. In the end, a happy user base is good for business!

JellyBeen – I feel if you are releasing a product it should be released in as complete a manner as possible, as well as not being hindered, crippled, or any form of reduced functionality. Whether a product is free or paid it should still be of quality, and part of the quality of a product is its inherent completeness.

Given the above point, the costs associated with additional services, support or customizations would be at the discretion of the author. The premise being: the product would inspire additional paid services, not demand them with inadequacies.

hallsofmontezuma – Releasing a product that is crippled to increase the number of people coming to you for support is extremely unethical, and likely won’t get you significantly more business anyway (re Anderson: they’ll probably just find another plugin).

You can charge for the product and/or for the support, but both the product and support should be good quality. That doesn’t mean you have to go out of your way to make absolutely certain nobody will ever need support, but you shouldn’t cripple the product. If one were to cripple their product so that they could generate more revenue from support, what’s stopping them from providing sub-par support that requires the customer to pay for even more support?

You always win out by providing a good product and good support. There will always be people who, as Anderson says, can’t even find the wp-content directory, but you shouldn’t have experts coming to you with questions about the basic functionality of your theme, plugin, etc.

Look at Windows, OS X, etc… your average to expert computer user can generally get along just fine with little or no support, yet there are still those who need (paid) assistance with even the most basic tasks. However, as a technical user, if I weren’t able to use an operating system I paid for, I wouldn’t pay for support, I would use a better operating system.

I think JellyBeen says it best, “the product would inspire additional paid services, not demand them with inadequacies”.

I encourage you to check out the forum thread and provide your own take on the matter. Be sure to read Justin Tadlock’s recent post on the subject considering he runs a business based on a paid support model.

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