Is AppSumo Worth the Hassle for WordPress Plugin Developers? — Freemius
Building a WordPress plugin and launching it are two different things. As developers, we are always fascinated with the idea of building something meaningful and solving a problem. But, a lack of marketing skills or low product visibility can kill the future of a product.
The most common setback for any product developer is that we feel the product is incomplete. It’s easy for developers to get into the continuous thought process where we come up with more ideas to improve a product, more features to add, code optimizations, etc. Amidst all this, we are unable to set a launch date.
In short, no product is ever “complete”. So, it’s good to launch a product with a minimum set of features that solve a problem and improve it further with user feedback.
We followed the same approach with all our products — PowerPack for Beaver Builder, PowerPack for Elementor, WPfomify, and DiviMonk. It has been successful for us.
How should I launch my plugin?
In the WordPress ecosystem, it’s common to see a freemium model for most products. Devs prefer to upload a free version to WordPress.org and provide free upgrades and support. Although it’s a good way to get started, it doesn’t guarantee success. The success of your product or paid conversions depends on the niche.
Sometimes, your plugin might not get the visibility you are expecting from the WordPress.org repository because it’s based on their search algorithm, and there are no other ways to boost visibility on the repository itself.
Another approach that’s becoming more and more popular is to go for “deals” on websites like AppSumo, Mighty Deals, Facebook Groups, or popular WP blogs.
When and why should I launch my WordPress plugin with AppSumo?
AppSumo is a great platform for launching your product. If you have built something that solves a unique problem or solves a problem better than an existing product, you can expect good traction from AppSumo’s followers.
The ideal time for launching your product can be when you are looking for some early customers, good marketing, and visibility. Once your product deal goes live on AppSumo, you can expect a lot of questions and feedback from buyers, which can help you continue the path to further development.
Spreading the word about your AppSumo promotion can help you get even more customers.
Will AppSumo be my WordPress business’ success partner?
AppSumo has an amazing team and a great process set up for working with product owners. It took us only a single 30-minute call to finalize the deal. In the following few days, we had an agreement set up for the deal with a launch date. They are truly focused on taking care of the marketing and helping you make the deal launch a successful campaign.
Wondering why they do that? The answer is simple — it’s the brand they have built, it’s their specialization, and that’s how they make money 🙂
In short, I can say AppSumo can be your partner for a successful campaign.
AppSumo Launch: How does it work?
Let’s take a look at the process of launching your product on AppSumo, go through all the steps for setting up a deal, and making it a successful launch.
Launching on AppSumo needs work and involvement from both parties. For example, we had to provide all the details about the plugin, some graphics, and a video walkthrough so that the marketing team at AppSumo could prepare their own marketing video.
Setting up a call and finalizing the deal
The first step is to pitch your plugin via email. In my case, I was lucky enough to have a friend who introduced me to their Head of Business Development. I was able to set up a call in the next few days.
On this call, we talked about product features, functionality, and vision for further development. Later on, we looked at possible pricing options.
AppSumo is all about deeply discounted prices on every deal. Along with this, AppSumo charges a commission between 60–70%, so you will end up receiving a very small part of the revenue.
It’s a good practice to go with multiple pricing tiers (stacking, as they call it). It’s good to start with small numbers and then offer a couple of license options for a higher number of sites or an unlimited number of sites.
For example, you can start with a price of $39 for a 10-site license. The next tier can be for 50 or 100 websites, and finally, you might offer an unlimited-sites license. In most cases, these are lifetime licenses, too. You will need to compare the discount value it offers against the existing pricing on your website.
Sumolings (buyers on AppSumo) have a tendency to go for 80–90% discounted prices. If your product is in high demand or solves a unique problem, then launching it with multiple tiers can be a good approach to increasing your revenue. The reason for this is that the way AppSumo works is that you can “stack” your license purchases. For a customer to get more licenses than the basic pricing plan you might offer on AppSumo, they will have to buy the next plan up, which will include X amount of licenses on top of the basic plan.
This type of pricing flexibility can be more appealing to AppSumo customers, thereby increasing your revenue over just offering a basic plan.
How to prepare for an AppSumo launch
Preparing for the launch involves several steps. Before we get into the details, I’ll share an overview of each one.
- Signing the agreement.
- Understanding the technical requirements and guidelines.
- Sharing plugin details — pricing structure, content, graphics, and a walkthrough video.
- Setting up the purchase process as per the guidelines.
- Joining the Slack Team
- Preparing for pre-sales questions and post-sales support requests.
Going Live! Signing the agreement
Once you get a green light after your call with the AppSumo team, you’ll receive an agreement that shares the finalized pricing, AppSumo commission, launch date, payment terms, refund process, and other terms & conditions.
Just like every agreement, it’s important that you review it thoroughly before signing. Sometimes, in excitement, you might end up ignoring a few things. But, it’s always good to read it carefully and ask any questions you may have.
A few things to note are:
- Pricing structure — make sure it’s the same as you discussed.
- Launch date — if it’s feasible for you or not.
- Payment terms — AppSumo processes payments 60 days after the deal goes live. More on this later.
- Refunds — AppSumo offers a 60-days no questions asked refund. Hence, the 60-days waiting period before you receive your payments.
- They have restrictions about promotions on other competitor platforms and Facebook groups.
Understanding AppSumo Technical Requirements & Guidelines
AppSumo has a streamlined process for everything, so working with them is a breeze. Once you have set the launch date and agreement, you will receive detailed documents about their technical requirements, which includes purchase, signup process, code redemption, refunds, stacking, etc.
If you have purchased any AppSumo deal, you should know that the buyer receives a Purchase Code that can be redeemed on the product’s website. Since AppSumo handles all payments and refunds, you will need to provide AppSumo with a couple thousand codes that can be redeemed on your website. You can set up these codes as “Discount Codes” on your website with a flat price or percentage applicable to a certain product that you have put on AppSumo.
AppSumo has set up some guidelines for code redemption and the signup process so that it’s easy for users to redeem their codes and get access to their purchase. Here’s a quick overview of what it looks like:
- Easy signup process
- No payment details required
- Enable stacked pricing to redeem multiple codes
- Prepare documentation required for stacking or signup.
Sharing Product Details
Along with the guideline docs, you receive links to forms for submitting product details, pricing structure, content, graphics, etc. These are used by the marketing team to prepare the sales page pitch and video transcript, as I mentioned before. It’s an easy to fill out form and will take you only a few minutes.
Here’s the video they made for us:
Setting up the Purchase Process
As mentioned earlier, it’s important for the users to get access to the product easily. So, it’s good to have a special or simplified checkout process on your site.
In our case, we created a custom checkout page for AppSumo customers along with auto-registration. On the checkout page, users were requested to enter their name, email, and coupon code. That’s it! Users were auto-logged in after the purchase was complete and also received their login + purchase details via email.
How did we do this? We used Gravity Forms, Gravity Forms User Registration Addon + EDD Gravity Forms Checkout Extension. As you can see, it involves 3 different plugins, but this all can be simplified if you use Freemius. Yes, that’s coming from an EDD user 🙂
For stacking the codes, we created an upgrade path from 1-site license to an Unlimited-sites license, which users can follow from the account area once they log in.
Once the purchase process is complete, there is another form to fill 😉
This form shares the details of the code redemption URL, documentation, etc, so that the AppSumo team can provide this information to buyers.
Joining the Slack Team
AppSumo invites you to their Slack workspace, where you’ll have dedicated, private channels for your product launch. A couple of team members from AppSumo will coordinate with you to make sure that everything is in place, like content, video, etc. They are always on time and it facilitates everything if you can respond quickly to their requests or questions.
Pre-sales Questions & Support Requests
When the deal goes live, you can expect a spike in support requests and pre-sales questions. So, it’s best to be available during the launch period for a couple of hours. If you have a few team members who can help you with it, even better.
We received some pre-sales questions on the AppSumo deal page and made sure to reply in a timely manner. Luckily, we didn’t receive many support requests because our on-boarding process was easy and we have extensive documentation available for WPfomify.
Now that we have covered how AppSumo works, let’s take a look at how it’s good for us as product developers.
What are the Pros of launching your WordPress plugin on AppSumo?
AppSumo has always been a tempting platform for product developers. They can be your marketing partners and help you with a viral product launch or a special promotion.
All Your Marketing Problems Solved
Yes, yes, I hear you — you are a product maker — you don’t know how to market your product, create a promotional video, or write a sales pitch — and hiring an expert marketer can be expensive!
Even after all that, you will have to shell out money for online marketing.
An alternative is to talk with AppSumo. They handle all those aspects for you:
- Writing the Sales Pitch
- Creating the Explainer Video
- Sales Email
- Paid ads
Visibility to a Huge Audience
AppSumo has a huge customer base, community, and fan following. It has built trust among buyers who like lifetime deals or special offers. There are a wide variety of products that appeal to professionals from backgrounds of all kinds and who use tech tools every day as part of their workflow. While AppSumo does let you reach the various market segments that might be interested in your product, like WordPress plugins, it generally fits best for mass-market products that will be widely popular on their platform, as opposed to niche products with a smaller user base.
Quick Sales & Customers
Once the deal goes live and the word is out, it’s only a matter of time until you start seeing sales. So, be prepared for the launch. AppSumo brings in your early customers and will help you spread the word. I would suggest making a list of contacts who can help you spread the word about your deal further.
Find Facebook groups relevant to your plugin niche and reach out to the admins, check if you can establish a connection, and get your deals posted. This will give you extra exposure.
Feature Request & Ideas
As I said, AppSumo has a mature, tech-savvy user base of professionals. So, you can expect some amazing feedback for your product. Make a note of feature requests and build them fast to keep your customers hooked. Maintaining a public roadmap for your product will help you even more.
If your product is new, the requests you get from support will help you understand the user’s requirements and questions, and help you build the plugin documentation further along. You can start adding commonly asked queries to the docs and most requested features to your plugin’s roadmap.
Community Engagement & Credibility
AppSumo has an active Slack and Facebook community that comprises not only AppSumo buyers, but product makers as well. Joining the community is a good way to get introduced to fellow makers and learn new things. If you can build your network before the launch, you can see even better results.
How much did we make from selling our WordPress plugin on AppSumo?
Yes, you are probably wondering how much money did we make, as eventually, that is the most important metric. So, here are the numbers:
As you can see, we acquired 624 customers for revenue of $7,300.80. This was generated over a duration of 6 months.
Here’s a monthly breakdown of our income, after fees:
What are the Cons of launching your WordPress plugin on AppSumo?
Since we have looked at all aspects of the process, including the pros, I’d like to cover the cons of launching your product with AppSumo.
Lack of Exclusivity for Deals
When you sign up for the AppSumo deal, you come to the agreement that states that the same product’s deal can’t be made available on any other deal website or social media site for X number of months (usually, it’s 12–18 months). This means that the deal remains unique and limited exclusively to AppSumo.
At the same time, AppSumo can offer deals for similar, competing products to yours, so this can negatively impact your sales. For example, when we launched WPfomify’s deal on AppSumo, there were similar tools and app deals launched on AppSumo during the same period. I think it would be better for AppSumo to have some delay between competing deals, so that there’s reduced competition around launches.
Highly Discounted Prices
AppSumo is all about discounts and most of the deals offer anything between 70–90% off along with lifetime access, which can be risky. While we sell WPfomify at $99/year for one website, our AppSumo deal was for $39 for a single-site lifetime license.
However, be careful with the appeal of highly discounted prices — if you get a lot of signups at the same time and the product is not stable enough, then you can get flooded with support requests and bad reviews. While buyers expect more for less, this can burn your hands at trying to meet their high expectations for such a reduced price.
High Commission Rates
AppSumo charges a 60–70% commission for all their sales and marketing efforts. We understand that it also covers their cost for running the ads. But, when we combine it with the highly discounted prices, we realize that the amount of money landing in our pockets is really low. To earn a decent profit, your deal must go viral.
Let’s do some math here.
Plugin original price: $99 per year for one site (40% renewal discount)
AppSumo price: $39 for one site (Lifetime)
AppSumo commission: (70%) = $39 x 70% = $27.30
Amount received per sale: $39 — $27.30 = $11.70
You can clearly see that a product normally sold for $99 per year, ends up banking only $11.70 for a lifetime license when sold on AppSumo. This means that if we receive a single support request and spend more than 30 minutes on it, we have already lost the money we earned.
You can clearly see that a product normally sold for $99 per year ends up banking only $11.70 for a lifetime license when sold on AppSumo.
Impact on Organic Sales and Existing Customers
If AppSumo is the only way you are launching your product and you don’t have any existing customers or organic sales on your site, then you are safe.
However, if you have existing customers who are already paying renewals, as well as organic sales, you might have some unhappy customers if they discover a deeply discounted deal on AppSumo. We all know what they are going to think: Should I request a refund? Should I ask the product makers for the same deal?
So, be prepared to answer these questions with saved replies that will address the customer’s concerns and help them understand why or why you won’t give them the same deal.
Payment Terms & Refund Duration
AppSumo handles all the payments and refunds for you, which is a good thing. They offer a 60-day money back guarantee to buyers, so they have enough time to use and try the product.
Because the cash flow for product makers is delayed by 60 days, it means that the day your deal goes live, you need to wait for another 60 days to receive your earnings. Even if you have make $100k in sales — it won’t reach your account right away. This can be a setback for product makers who are relying on the sales for their cash flow.
A 60-day refund policy is a very long duration, which naturally increases the percentage of refund requests. Most digital products offer money-back guarantees for only 14–30 days.
Another problem with handling refunds is that you have to manually check the codes which were refunded and update the same in your setup. Since the refunds are processed by AppSumo, there’s no direct account cancelation on your site and you don’t get the email address associated with the refunded codes, which makes it difficult to close the account.
In short, it’s painful to deal with refunds on AppSumo.
Lack of Feedback for Refunds
While many product makers offer a no-questions asked refund policy, there’s a chance for asking the reason for a refund to better understand your customer’s expectations.
However, since payments and refunds are handled directly by AppSumo, product makers miss out on the opportunity to receive that valuable customer feedback.
My Thoughts on AppSumo Deals for Plugin Developers
I hope my outline of the process, pros, and cons will help you make a better and more educated decision about your plugin launch.
The next thing I want to share is a bit more about my personal opinions.
How did it go?
The first question everyone wants to ask is — how did it go for us?
To be honest, I was super excited about the deal. In fact, so much so, that I was dreaming of a lot of customers, feature requests, questions, and fame for our beloved plugin.
But, my dreams didn’t really come true. It was an average experience.
Why did that happen?
- Timing — The deal went live on December 16, 2019 and holiday season starts a week after the launch, I am assuming this might have impacted the sales.
- There were already competing deals on AppSumo for FoMo tools.
- I had excessively high expectations. I was under the impression that there would be an email blast to such a huge audience and that people would love our product so much we would be flooded with requests.
- I could have put more effort into this on my end.
Once the deal went live, I got to know that AppSumo has a different plan for “aggressive” marketing based on the deal’s success rate. They encourage sellers to get some early reviews from buyers on the deals page, and there are a few more steps to get into their “good books” of a viral deal.
Unfortunately, I lost the message, as it was shared on Slack. So, I don’t remember all the details at the moment of writing this, but the aggressive deal includes X number of reviews in the first 24–48 hours and X number of sales, as much as I remember. If your deal crosses those benchmarks, they move ahead with even more promotion.
How many support requests?
Since we had complete documentation ready for users, easy onboarding, and the code redemption process, our support request count was very low. We received about 20 support requests related to product functionality or questions.
I feel that support wasn’t a big concern for us, and hence, the amount we made from the sales was sufficient. It didn’t add to our support efforts in a big way, nor did it make us sweat.
What could have been done better?
If I were to do another deal on AppSumo, I would take care of the following:
- Pick a better date
- Negotiate better terms 😉
- Plan the launch announcement within my network
- Reduce the deal duration
- Engage more with customers and users
Would it be Better to Market the Product Myself?
The deal with AppSumo makes me wonder — “What if I had spent 70% of the product cost on marketing?” That would be $99 * 0.70 = $69.30 for each sale.
I could handle marketing on my own, but I wouldn’t have the time to handle it properly. Assuming that I had the money in my pocket to fund a campaign by a 3rd party marketing agency, I did some rough math like this:
Total Ad Budget = $10,000
Agency’s setup fee (It’s usually a one time cost) = $1,000-$1,500
Agency’s ongoing fee (Most agencies charge 15–20% of the ad spend) = $2,000
That brings my cost for first 1–2 months to be around $13,500
To make profit, I must cross revenue of $13,500 from my marketing campaign. Let’s set my personal “happy number” to 13,500 * 1.5 = $20,250.
If you have a $10,000 ad spend, $20,250 is more than 2x revenue, and you have the Return on Ad Spend (ROAS).
A 200% ROAS is considered to be decent, but can be further improved.
After paying my bills for the marketing agency, I would be left with
$20,250 — $13,500 = $6,750 in net profit. Not bad, huh?
At $20,250 in revenue, let’s assume that all the customers signed up for a yearly package priced at $99/year. Additionally, I offered a 10% discount to make sure that the customer buys the Product. For $13,500 in costs, I would have signed up 227 new customers.
Cost of Acquisition = $13,500/227 = $59.47 per customer
Cost of goods sold = $99
Amount received per sale = $99 — $59.47 = $29.73
Compared to the income from AppSumo — $11.10 for a Lifetime License, I would have made $29.73 for 1 year of product updates and support. If these customers renew their license for next year, I would make another $59.40, or they might upgrade to a higher package during the course of their subscription.
While all the numbers look good (hypothetically), there are chances you might fail with this strategy as well. What if your campaigns don’t work and you end up wasting the money? We can only think of using a 3rd party marketing agency if we have the resources, money, risk taking capacity and the right marketing agency to work with.
AppSumo gives you a targeted segment and reduces your risk of monetary losses because your marketing expenditure is zero upfront. Your expenses end up coming to you in indirect ways like high commissions and discounted prices.
Every coin has two sides, and the same goes for every decision that we make in life, including our plugin launch. The launch can be good or bad depending on various factors including the plugin itself.
As I mentioned above, AppSumo has its advantages, like huge audience, marketing expertise, and lower monetary risk. At the same time, the discounted prices, high customer expectations and lifetime licenses can be a bad deal.
So, I would suggest you consider all the factors, run your numbers, and make a well-thought decision on whether to go ahead with a launch on AppSumo or take a leap of faith to launch your plugin yourself by setting up a marketing campaign.
In conclusion, AppSumo can be a good solution for your product launch if your product is stable and ready for a large number of users and/or the support load will be manageable for you. Even if your launch doesn’t bring in a lot of sales and money, you shouldn’t be disappointed because you’ll still get a lot of exposure to new users and you can use the proceeds to grow your business even more.
If you go through with an AppSumo deal you will have set the path forward for your product. You will have your marketing content ready because of the content they require for launch, and hopefully, you’ll be able to turn that marketing content into your first sales with their help.
That’s a wrap! I hope you can now bring out the idea that you have been working on as a side-project, launch it with AppSumo, and see how it goes! Who knows, you might be sitting on a gold mine!
Originally published on the Freemius blog on June 16, 2020.