One of the biggest challenges (there are almost too many to count) for a business starting is customer acquisition and revenue generation. Enter the temptation of the “big payday” that is to run a Lifetime Deal (LTD). A LTD is an offer when you are introducing your product, where the customer pays upfront for a perpetual licence. This can be a great tool to get your first customers and some cash flow coming in, but it comes at a cost that you need to be aware of.
Lifetime deals can really help your business grow and help get your name in the industry, but what you need to remember is that to run a lifetime deal, it is not a leading source of funding and, if done poorly, cause more issues than they solve.
Our Experience Running a Lifetime Deal
In the case of Visitor Queue, we did an LTD on Siftery before G2 purchased them, this was extremely lucky in our case as they did not take a percentage of the sales. Compared to some of the other LTD companies we researched and were asking +50% of your LTD sales. We were a very small start-up at the time and could not afford the +50% of sales. We ran our LTD for 2 weeks, we were able to sell 50 deals and made just over $4800 CAD. This helped us immensely as a bootstrapped company. All of those clients that bought in over a year ago with our LTD are still with us today and actively use our software. Also, due to the level of support given at the beginning, they do not require assistance now and give us glowing reviews and recommendations.
What Works For You?
Determine how long/how many of your LTD you are willing and able to sell. When we did run a lifetime deal, we set out a time that this deal was going to be over, and we sold as many as would sell within that time. If this is not the correct process for you and you only want to sell “X” number of deals, determine how many that is and state that in the marketing channel as well as on the deal. If you choose to implement either of these strategies, put a clock or a counter on the deal so that it increases the urgency when customers see your deal.
Don’t Rush To Market
Need the cash now? In a hurry to get to market and get your product out there? “If only I had “X” amount, imagine what I could do.” If any of this sounds familiar, maybe a LTD isn’t the right strategy for you… At least not right now. You shouldn’t be rushing to market with your product in order to get it in front of customers. Your system needs to work very well in order to go to a LTD or else you are going to have a lot of unhappy customers churning very quickly, asking for a refund. There will always be a group either looking for a LTD or willing to promote a LTD for you.
Don’t Plan On Doing Anything
For the 2 to 4 weeks after you run your LTD, don’t have anything major planned for your business. You spent countless hours getting ready to launch your LTD and countless hours while the deal was active, did you really think after it all the craze would just go away? There are going to be questions, concerns, breaks, and overloads for the next little bit until you can get your system working. Plan for this time, so you are not stretching yourself thin.
Problems While Running a Lifetime Deal
If there are any issues, big or small, they need to be resolved before you go to your LTD. Any issue, no matter how small it may seem at this moment, will only scale when you push your software to a LTD and have multiple people buy it and use it. Even if these small issues do not arise for the few early adopters of your software, when it scales to thousands of customers, it will only put more strain on the issue.
Do not think when I say this, I mean it should be perfect when it launches, nothing will be perfect, and you will be running in circles trying to chase perfection. This only means, address the issues that are known to you and do not ignore them. When issues arise, deal with them as soon as possible, so only a few are affected by it.
There Is Only One Of You
When dealing with customer inquiries, be sure you have a ticketing system in place and to test it thoroughly before the launch. If you do not have one in place or it glitches in the process, your customer inquiries are going to get confusing very quickly. This will lead to you and your team missing and/or dropping requests, which lead to unhappy customers.
Not only should you have a ticketing service implemented, but a chatbot will greatly help you in the future. There are going to be a lot of questions, and a chatbot can help you answer some of these questions before it has to escalate to you. Most customers expect a chatbot, so do not worry that having this will drive customers away from your website.
Call In For Backup
The week (or whatever time frame/”unit” selling frame) you have your LTD launched, ensure you have a larger than normal support team to help with the influx of customers you are going to have. This is also where a very good chatbot is going to come in handy for your team. The chatbot may not be able to give the correct support to all of your customers, but it will distribute information to assist some and be able to regulate the flow of customers coming in. Whatever number you are thinking in your head for the number of support staff to handle these customers, I can assure you it will be 25-50% than that.
As you can see, to run a lifetime deal can be very beneficial to your start-up, but it can also hurt your start-up if not done correctly. If you rush to market before your service is ready and it bugs out on your customers, they may be willing to accept a grace period, but if it continues, they may want a refund. Or if you go to market with software that is ready and works well, but you are not able to afford the high prices, some LTD websites charge or do not meet the amount you were hoping it could put your business into a financial predicament. Ensure that your software is ready for market, your support team is ready and in place, and that you are able to take on the pricing situation and time burden after the LTD. Good luck!