January is an inexplicably long month. đ°
Perhaps itâs a kind of repercussion from taking a longer break over the âholiday periodâ, coupled with the long nights and cold, overcast days. Or maybe itâs just some psychobabble illusion that weâve all bought into. Who knows! đ¤ˇđťââď¸
For me, January's long. In fact, not only is it long, but itâs also always a frugal month too.
With both the November and December paychecks absorbed by a combination of traditions and frivolity, January sees the demands of annual renewals. Things like broadband, road tax, car and house insurance, and not forgetting the ever painful, balance-dredging experience of the tax return.
Thankfully, the latter shouldnât be a problem for the foreseeable. Iâm no longer freelancing, so things like dealing with HMRC are offloaded onto othersâsorry accounting team!âand I can go back to gawping in horror at the rising cost of my collective premiums.
As a frugal, renewal-heavy month, itâs also always a time where my non-existent negotiating skills come into playâI imagine myself something of a Danny Roman-esque character, though I fear the reality is Iâm more a Jake Peralta.
In any case, it all goes off in January.
Many an agitated telephone call takes place, searching and pleading for a âbetter dealâ. Letâs face it, nobody wants to feel like a chump paying 50 bucks more than Joe Nobody down the street. To be honest, there are times when Iâm willing Kevin Bacon to appear and bestow his wisdom of mobile tariffs, coverage, and handset releases.
Insurance is always the funny one though.
Year on year the same thing happens. It starts with that email from the insurer telling you about a $150 hike in your renewal premium.
$150 is a lot of coffees, so itâs only natural to end up entertaining competitive counter offers from tubby opera singers, or a couple of racially-questionable Meerkats. Those tech-savvy, fuzzy feliforms always come in $200 cheaper.
Iâd like to say what happens next is a conundrum, but in the end, it all goes the same. A swift call to the insurer informs them of competitive offers and hey presto! Suddenly we saved ourselves a few hundred bucks. đ¤
Itâs the same every year. The same cheaper deals. The same phone call. And the same follow up conversation between my partner and I where we always posit the same question: Why donât they just match the cheapest offer in the first place?
Of course, we all know the answer. đ°
Itâs a gamble. It wouldnât be far fetched to imagine for each person who questions their renewal, at least one person doesnât. The house always wins! And probably more than weâd want to believe.
I donât begrudge them. Theyâre chancers. Itâs what theyâve always done, and no doubt itâs what theyâll always do. Câest la vie!
Sometimes the Art of the Deal is Accepting the Price
While Iâm a fan of the oldâ negotiating tactics as a consumer, being on the other end can be frustrating.
This time last year I was quite naive to it. Iâd worked in a billing department before, but generally, weâd end up sending customers to a retentions department. So Iâd never had to deal with many requests for a better deal.
To be honest, Iâd managed to kid myself that we were being savvy by getting in touch to get a cheaper deal. I thought it was more likely that other people sat idly by, content to accept a price hike as a fact of life and get on with their day.
Oh, how wrong I was!
While tackling support queries at HelpDocs over the past few months, I realized the vast majority of people are after a deal.
Ok, so I might be exaggerating a little. But the amount of people who ask for special pricing is way more than Iâd initially anticipated. Way, way more.
The frustrating thing is our prices are pretty self-explanatory. We very rarely do discounts, never outside of a partnership of some sort. Sure, we offer reductions for certain types of companyânon-profits, charities and the likeâbut thatâs just because morally itâs the right thing to do. And even then itâs the same discount for each one.
The trouble is, throwing out random deals breeds inequality.
Dealing with Inequality and a Race to the Bottom
I always find it quite strange when Iâm asked to give a special discount. Thereâs a wonderful irony that the same people who ask for discounts couldnât bear it if someone else was paying less than them.
I find myself thinking about other customers. Those who are happy to accept the pricing as is. No complaints. No extra demands. No âyour competitorâs cheaperâ.
Often, theyâre the good customers. The ones you want to reward. Yet, if we bowed to the bargain hunters, they are the ones who would end up paying more while those with the audacity to ask for a deal wind up paying less.
Is that fair? I donât think so.
Keeping it Simple Saves Stress
Charging different people different amounts just ends up being confusing for everyoneâthough admittedly more us than you.
While it might seem insignificant, custom pricing has a knock-on effect on our data.
It skews the information we use to make informed business choices. It means we canât rely on metrics like MRR to monitor how well weâre serving our customers, or LTV to set reasonable benchmark prices.
Basically, even a few instances of custom pricing can really mess with our ability to function as a company as well as we do right now.
Fair pricing, by contrast, ends up being much, much simpler. It means when we make changes to our pricingâwhile few and far betweenâitâs based on accurate data.
But most importantly, it means all our customers are equally valuable to us, whether theyâre large or small.
Addressing the Hypocrisy
I know, I know. I sound like a hypocrite. After all, Iâve just said I love getting deals.
But in truth, my willingness to negotiate with insurance, phone, and internet companies boils down to their inherent flexibility with their pricing.
Just as with our software, their product doesnât change. It doesnât matter whether youâve been a customer for 10 years or 10 minutes.
Yet, pricing does change. Often quite dramatically.
One day you can be paying $50 a month, and the next itâs doubled despite no changes to the product or service or the cost of doing business.
The trouble is, when companies offer half-price contracts to new customers, these shiny deals with free gifts and cash back incentives, they seek to make their money back in renewals.
That feels dishonest to us.
Our pricing, conversely, is fixed. Everyone pays the same for each plan when they sign up, and they get to keep that pricing forever.
No games, no tricks, no "introductory offers". Just fair pricing for everyone.