After it was initially released in 2019, it offered a lifetime offer (LTD) through appsumo deals.
In simply two weeks, it raked in an income of $140,000. More than that, it resulted in an extra $100,000 in yearly recurring profits (ARR).
For many SaaS startups,
launching an LTD is an excellent choice to boost their SaaS service and raise funds to invest in more growth. And among the most popular platforms for offering these deals is AppSumo.
Today, we are going to talk about AppSumo, its advantages and disadvantages, and other factors that can assist you to decide whether it is a lucrative venture for your SaaS organization.
What Is AppSumo deals?
Initially, let’s talk a bit about AppSumo.
AppSumo is a market for digital items like online courses, e-books, Chrome extensions, and SaaS solutions.
For SaaS companies and startups, AppSumo offers you the possibility to use your SaaS service as a lifetime deal. It enables you to offer your LTD to their 500,000+ existing audience called the Sumo-lings.
What’s more, the AppSumo marketing team will likewise promote your SaaS service through videos and social networks.
And in return, AppSumo receives a commission for each purchase.
Let me stop here since this is not the focus of this article.
We’ve currently covered that in another post. If you need to know more about this platform in detail, check out our guide on introducing your SaaS product on AppSumo.
Now, let’s speak about the real focus of this article: whether or not it is profitable to sell LTDs on AppSumo.
To come up with a well-rounded decision, you initially have to weigh its pros and cons.
Pros Of Offering an AppSumo Lifetime Offer
Providing LTDs on AppSumo has the following advantages:
Instant access to a big audience
Free marketing
Sincere user evaluations
Can help bootstrap SaaS startups
Let’s discuss them one by one.
Instant Access To A Big Audience
AppSumo in itself is a well-known marketplace for SaaS services and various digital items
Most users who are looking for SaaS LTDs go to this platform to discover a bargain.
And don’t ignore the Sumo-lings that we discussed earlier.
These are avid users who don’t simply go to the platform when they feel like it.
They actively follow AppSumo and its item listings through email newsletters, social networks, and online SaaS communities.
Since this writing, AppSumo’s email list has more than 730,000 e-mail subscribers.
Additionally, Appsumo also has a wide social networks reach. It has over 270,000 followers on Facebook; 129,000 on Twitter; and 37,000 on Instagram. It likewise has an official Facebook group of more than 16,400 members.
That’s the sort of audience you will have access to.
However, that’s not all. AppSumo’s community is so detailed that it even has exceptional membership options called AppSumo Plus and Briefcase membership.
These subscriptions primarily benefit its users with exclusive discount rates and software application ideas. If you offer a sufficient SaaS option, you might just wind up being on those suggestions.
Free Marketing
As AppSumo is a marketplace for SaaS products, this means that they understand how to market your lifetime offer and get the very best promotion for you.
If you get a handle AppSumo, you will satisfy its digital marketing team to come up with an advertising method.
AppSumo markets your product through several platforms and media, such as the following:
Product listing: Let’s very first talk about the most obvious one. AppSumo is a digital market. Obviously, your SaaS product gets included as a listing.
When AppSumo lists products on its website, it highlights the unique selling proposition (USP) of each item. Make sure to plainly communicate your USP to the dedicated marketing team.
Email marketing: Remember the 730,000+ customers?
AppSumo sends e-mail newsletters to its mailing list every once in a while. And sometimes, these emails feature the best AppSumo lifetime deals and products.
If your SaaS solution makes it to one of these newsletters, that would be a huge increase in direct exposure and traffic.
Social network: Now, keep in mind the other thousands of followers on different social network platforms. The marketing team can promote your AppSumo offer on their social media pages.
AppSumo usually posts about digital products and site functions. It also shares unique deals and product recommendations. Once again, those sorts of posts are where your product could shine.
Video: This isn’t truly a marketing channel. But it is an effective and appealing marketing tool.
AppSumo has its own YouTube channel where it frequently posts featured products. If you successfully start a deal with them, they can make a video that features your product.
AppSumo’s online marketers will publish it on their YouTube channel and in your product’s listing. They may even consist of a link to this video in their email newsletters.
Truthful User Reviews
Being a marketplace for digital items, AppSumo also provides its users the chance to leave reviews for each product. Deviating from the typical star-based rating, The platform’s score system is based upon tacos.
These reviews and tacos can benefit you by serving as social proof.
Picture a prospective client who still has doubts about your product. Hearing about others who have greatly taken advantage of your SaaS option may simply be the push they require in the past purchasing.
That’s why you require to make sure that you build a premium product that users will discuss. If you want positive evaluations for your SaaS product, you would want them to be honest.
Otherwise, you would be getting more refund demands than you expect.
Don’t stress over problem and unwarranted reviews either.
Bear in mind that you have Sumo-lings here. These are SaaS users who understand what they are speaking about.
Sure, you might still discover a few AppSumo users’ evaluations that just do not make good sense.
Most of the evaluations you’re going to get will be significant and useful.
Because we’re speaking about honest and in-depth evaluations, that indicates they won’t constantly agree.
Since no SaaS product is ever ideal, that’s simply how it is.
There will constantly be space for enhancement and someone who will call you out for it.
That does not indicate you can’t do anything about it either. You may have no control over what your users state, but you can still do something about your action.
Even if you get some nasty comments every once in a while,
answering politely goes a long way in constructing your brand name. Being hostile or defensive with your response can send an incorrect message. It might make potential consumers think that you’re not happy to listen.
And customers tend to avoid staying in business with people like that.
Reacting calmly and proactively will assist you to convey to your customers that you care about their viewpoint.
You can also take this possibility to ask for more information so that you can solve the problem together.
That’s one of the benefits of getting honest reviews. Even the negative ones provide you a chance to discover areas where you can enhance your product.
And you understand what they state: knowing is half the battle.
Still, it’s inadequate to just know what to enhance or promise to improve it. You have to in fact enhance it.
That’s how you develop trust and long-lasting relationships with your clients. Listen to what they have to say and act upon it.
It Can Assist Bootstrap SaaS Startups
Bootstrapping refers to the act of growing a service only with its earned profits and without outside investment.
This is in contrast to venture capitalist (VC) funding where you look for investors to fund your development in exchange for shares in your company.
On the planet of SaaS, bootstrapping is usually the hard way in growing a company.
The SaaS market is getting more and more competitive. If you’re a SaaS startup, you need to grow fast. With sufficient cash, they can develop marketing and sales powerhouses.
Bootstrapping typically doesn’t have that luxury. You just rely on the profits that you really make from selling your SaaS item.
The revenue is simply going to be smaller amounts each month or annually.
Unless you’re selling an LTD
. Because LTDs provide lifetime gain access, they are generally priced higher than subscription-based rates.
But for that to work, you require a lot of early adopters to buy your LTD.
And for you to reach that many individuals, you need a marketing team. And to have a good marketing team, you require cash.
And if you’re a SaaS startup structure from the ground up, that can be a significant obstacle without financiers.
So does that suggest you can’t promote your LTDs without venture financing?
Well … not always.
Remember that, with AppSumo, you can get an immediate audience and complimentary marketing. You’re all set to bootstrap your SaaS start-up.
Cons Of Offering an AppSumo Lifetime Deal
Now let’s talk about the not-so-good details about providing your SaaS product as an AppSumo deal.
LTD do not have repeating profits
High commission rate
The stringent product evaluation process
Pricing may not show your item’s genuine value
Let’s speak about them one by one.
LTD Lack Recurring Profits
Okay, this con isn’t simply exclusive to AppSumo deals LTDs, but for all LTDs.
The design for SaaS products is to have subscription-based payments instead of one-time.
This implies that your customers will pay you for as long as they use your item. It could be an annual or regular monthly membership, depending on the plan.
You also have repeating expenses for keeping each of your existing users. You offer constant customer support, server allocation, and other overhead costs for each user.
If your prices model is purely one-time payments across the board, it might not be sustainable in the long term.
That’s why LEDs are merely a means to an end.
If you are a SaaS start-up, having your product listed on AppSumo can boost your brand name awareness and drive significant initial profits.
Then you can utilize that income to fund your development and protect subscription-based customers and start getting recurring income.
High Commission Rate
When using any third party to promote or offer your item, the commission is a substantial consideration. And if you’re going to delight in all the pros we discussed previously, you require to be knowledgeable about the cost.
It’s a 70/30 split.
And no, you do not get the 70.
Yes, that indicates just 30% of each AppSumo purchase for your lifetime deal will go to you.
That seems a quite low cut.
However, to stabilize this out, a great deal of SaaS companies believe it deserves it. Otherwise, they would not offer LTDs on AppSumo.
After all, HeySummit did manage to make 140 grand despite these rates.
And remember that this is a commission. With all the marketing projects, the audience, and all the pros we’ve talked about, you don’t have to pay any in-advance costs.
You pay only when you earn money.
Rigorous Product Examination Process
One really important thing you require to know is that it can be tough to actually get your SaaS product noted on AppSumo.
It’s not like you can simply send them your offer and expect it to be there in a few hours.
No, AppSumo is not searching for any old SaaS item. Your item has to fulfill particular standards in order for the platform’s team to consider it as an alternative.
The AppSumo group will carefully examine your product prior to anything else. They’ll look at the worth of the item, whether their clients would want to pay for it, and a lot more factors.
The reason for this strictness is to develop and keep trust with their audience.
You buy an LTD for one of the brand-new SaaS products on AppSumo. Then a few months later, the developer of that SaaS option goes insolvent.
How would you feel? Cheated? Tricked? Like you’ve wasted time and cash?
AppSumo doesn’t wish to run the risk of any of its consumer’s feelings by doing this. That’s why they have to be stringent when it pertains to the products they promote.
This strictness is what makes AppSumo a credible and important platform for buying and selling digital products.
However what if you do not make the cut? What if you don’t pass AppSumo’s assessment?
Does that mean all hope is lost for you to note your products on AppSumo?
The answer is no.
If your product doesn’t make the cut, you can still access the AppSumo Market.
Just a heads up. If you do not your product on AppSumo Market, you will have to do your own promotions and marketing campaigns.
But do not fret excessively. AppSumo still supplies design templates for some products that you would require.
Pricing Might Not Reflect Your Item’s Real Worth
When it concerns SaaS rates designs and strategies, the best approach would be value-based rates.
You don’t wish to set a rate so high that it won’t draw in users and early adopters.
You also don’t desire it so low that it would maim your organization. You desire the sweet spot.
That’s what value-based pricing is. You can sell your item at a rating point that matches its value. And your customers would still be willing to spend for it.
In some cases, promoting your item can mean giving out huge discounts. Specifically, with AppSumo projects, the limited offers can be really inclined to favor the buyers.
And that rates may not always show the real worth of your SaaS option.
Sure, if AppSumo offers your item at a significant discount rate, you will absolutely get inbound traffic and sales.
And the platform can drive in a lot of sales through their existing Sumo-lings.
If you do it too often, the low price point may communicate that little amount is just what your item is worth.
For example, you have a SaaS item worth a starting cost of $20 monthly. You manage to get it noted on AppSumo and the LTD costs a one-time payment of $99.
The picture on the very first run, attracts a considerable number of purchasers.
They see it as a great deal. So they buy it and you get a considerable revenue.
However then, after a couple of months, you decide to release a limited-time LTD campaign on AppSumo again. And you use your product at the exact same cost point.
It still might bring in some users, but not as much as the first run.
But you decide to introduce it again after a couple of more months.
But this time, your SaaS tool has currently constructed credibility of being “the 99-dollar product.”
That’s not what you want your prospective buyers to think.
If you want your SaaS solution to be considered a premium service in the future, you can’t pay for to have it undervalued by potential customers.
So if you’re going to offer huge discounts on your LTDs, don’t do it frequently.
Remember that recurring revenue is still the goal. Relaunch an LTD and discount project only if there is a high need for it.
If you are going to relaunch, use a deficiency marketing method.
Limit the variety of purchases or the period of the deal.
Even much better, use holidays to further promote your LTD. Offer them on Black Friday, Christmas, or other vacations.
So Is AppSumo Worth It?
AppSumo is an excellent platform for SaaS services to release a lifetime software offer and other digital items. Your item gets included on AppSumo’s website, newsletters, and YouTube channel.
You likewise need to count the cost if you’re going to do this.
AppSumo has a really rigorous assessment process before consenting to promote your SaaS tool. And when you do, it can take a big cut from the revenue as commission.
Now, how do we respond to the question “Is offering Appsumo lifetime deals worth it?”
For the many SaaS companies that have actually sold their SaaS items on Appsumo, the answer is yes.
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