Startable – Healy Jones’ & Prasad Thammineni’s Blog

After a lot of hard work and some cool new product releases, OfficeDrop finally made it into TechCrunch.

TechCrunch reporter Rip Empson covered the new ScanDrop Mac’s ability to scan, screenshot, save to the cloud and share via social networks.

As Rip explains it, ” announcing updates to its ScanDrop Mac and ScanDrop Lite apps (ScanDrop Lite is free) that let any Mac user integrate scanned paper with digital screenshots to create multi-age, searchable PDFs. But what’s really cool about this is that, with a single click, users can now share these scanned docs via social networks or store them in Evernote, Dropbox, OfficeDrop, and Google Docs.”

He also gives an example of possible workflow that users can take advantage of using the ScanDrop Mac app: “ within ScanDrop, users can merge scans, screenshots, and image files into a single, multi-page PDF to then share as they choose. If a user scans a receipt, he or she can then grab a screenshot of a corresponding spreadsheet of receipts and share that as a single PDF document through Facebook or Twitter, for example.”

Finally, the article mentions our recent, dramatic growth.

Read the article here!

Do we finally have a real competitor to the iPad? Is Amazon going to do it!?!? I’m getting pretty excited here.

Don’t get me wrong, I love my iPad (actually it’s my company’s, but hey). However, the world needs at least one legitimate competitor to the iPad to keep Apple honest and to push the industry to continue to innovate.

Preliminary sales numbers for Amazon’s Fire are supposedly very impressive. Mashable is reporting:

More than 250,000 Kindle Fires have been pre-ordered since Amazon announced the new tablet computer last Wednesday, according to a report from Cult of Android.

The blog says a “verified source” within Amazon provided screenshots of the company’s internal inventory system. The screenshots show the Kindle Fire has been pre-ordered at an average rate of 50,000 units per day.

That’s legit if it’s true! Note that I couldn’t link to the original source, Cult of Android, because their blog seems to be down. This is big news… Ah, wait, it’s working for me now:

These leaked shoots show that orders for Amazon’s Android-based tablet are racking up at an average rate of over 2,000 units per hour, or over 50,000 per day… Those numbers make the Kindle Fire’s launch likely to be the biggest tablet launch in history, beating both the iPad and iPad 2 in first month sales. The original iPad sold 300,000 units on April 3, 2010, its first day of availability. In the first month, iPad sales amounted to over a million units. By the time the iPad 2 came around in March of this year, Apple managed to rack up an estimated 2.5 million units in first month of sales.

What does this mean, beyond the fact that there may be another real player in the tablet space? I think that it shows that PRICE really matters in the tablet space. $199 is a sweet spot, perhaps. And remember that HP’s tablet flew off the shelves when the price was really reduced… it looks like there is a market for lower priced tablets. Of course, this follows along with the Google Android strategy of having a LOT of low end phones running on the software.

What will it mean for app developers? 1) Get in the Amazon Android marketplace. 2) Get ready for another form factor + potentially highly modified Android OS. 3) Get your hands on one of these devices ASAP so you can get a feel for how your applications will run on it.

One of my sysadmins pointed out a great post from yesterday on using a decoy on your pricing page. If done well this can be a great strategy.

I’ve used this decoy pricing tactic on OfficeDrop’s pricing pages for a while. In particular, our digital filing pricing page has an expensive plan that has nicely increased overall conversion on the page.

The main result of this decoy is increased conversion on the page. In otherwords, a higher number & percent of visitors to the page pick a plan and become an OfficeDrop user. It hasn’t really changed the MIX of plans (very few people pick the expensive plan and the same % of people pick the other plans). But I consider the decoy plan a success because it’s getting more people into our funnel.

You can see the pop here when we added a decoy pricing plan to our standard digital filing pricing page. This chart is the % of visitors who visited the page and then signed up for a plan. I.e. the conversion rate of the page. Note that there is a little dip in the beginning that has nothing to do with pricing; it’s a data error. The way to look at this w/o the data error is the two little peaks on the left are close to the pre-decoy conversion rate average; the hump on the rigth is the new average post addition of the decoy pricing plan.

What the Decoy Pricing Plan Looks Like

The decoy pricing is the “ScanPro” “ScanFive” plan on the right. (Thanks for the typo catch Pete!)

Decoy Pricing Plan

It’s designed to be expensive and to make clear that we’ve got the ability to support additional users in the plans… it’s not really clicked that often.

Anyways, check out the post I linked to above. You’ll find it very solid, and it explains why a decoy plan works.

Lincoln Murphy, the well known SaaS Marketing guy, got pretty upset at a recent TechCrunch piece on the freemium pricing strategy that posted this weekend. Lincoln says (I’m on his email newsletter list; it’s pretty good): “In a nutshell the Complete Guide to Freemium on TechCrunch is a post by someone who got lucky enough to get their post accepted so he can get a backlink to his site from TechCrunch and where he takes the results of studies and some words from high-profile VCs and weaves it together into a post for the TMZ of the tech industry.”

Ouch. That’s a little harsh. The article isn’t bad at all. The conclusion is 100% great, actually.

What is Freemium?

However, I don’t think it’s the Ultimate Guide to what is a actually a pretty complicated pricing strategy. I happen to disagree with the author’s ideas that a time based free trial = freemium. I can’t tell if my disagreement is a big deal or not – his company, FutureSimple, has a free trial offer, so it’s hard to know how much of the piece is using that as the basis for the post vs. a couple of professors he references. I disagree with the idea that a free trial is freemium so much because OfficeDrop recently made the switch from a free trial to having a free forever plan and we called it “going freemium.”

My definition of freemium is that a user will have the opportunity to use the service/software/whatever forever without having to pay for it. It may be a limited plan or limited features, it may be ad supported; whatever. It just means you can use it for as long as you’d like without paying. FreshBooks has a freemium model, but you run out of “free” pretty quickly. You can jump through hoops to keep it free, but most likely you’ll upgrade. A free trial that expires after a set number of days doesn’t meet my definition of freemium.

OfficeDrop’s free plan is driven by our mobile distribution strategy. I write a little bit about why we think apps are taking over here. But you should listen to my conversation with Lincoln – I call it “Healy Jones on Freemium.” Our free plan is a free forever plan, with some upgrade triggers baked in – search limits, storage limits, OCR limits. But it’s a pretty good product for free; we are the only company offering free high quality OCR for scanned images coupled with storage. People seem to like the plan… and they also seem to like to upgrade to paid plans. We like that part for sure!

Lincoln is putting on a webinar on kicking butt with your company’s free trials model. I think he’s got some good stuff, so I’d suggest you register!

Yup, it’s me, Healy Jones, talking about the OfficeDrop cloud filing system switch to freemium with Lincoln Murphy of 16Ventures. Lincoln is that well known SaaS pricing guy, and we go over the switch OfficeDrop made from a pure web only service with a 60 day free trial to an app focused business with a freemium pricing model.

The switch in our pricing strategy has been pretty huge for OfficeDrop. It’s driving a lot of new user growth – both free and paid. It’s been only a month and a half since the switch and the change is clearly measurable with our analytics packages. So far, for our SaaS company, freemium seems to be working.

Check out the interview with on why OfficeDrop went Freemium here! Or simply watch the video embedded below.

Healy Jones with Lincoln Murphy on Freemium

Ok I’ve got to brag a little here. OfficeDrop recently launched our newest mobile app, the OfficeDrop Android Paper-to-Go app, and we’ve had great success with new users and downloads. I’m working on a post about how SEO may be dying, at least for SaaS services, since the huge majority of our new users are coming from app marketplaces these days. I really think we are undergoing a significant shift in the way people find and buy software and web services… and I’m personally having a ton of fun trying to figure it out!

Anyways, here is some of the recent press OfficeDrop has gotten on our new Android app:

May 18, 2011

OfficeDrop: Scan Docs, Turn Them into PDF & Make Searchable (Android)

Using Paper-to-Go you can scan physical documents using your smartphone’s camera and store these documents … other file formats can be uploaded and processed as well. Read OfficeDrop’s Paper-to-Go Review on makeuseof…

Really? Does this make any sense? Intuit announced that QuickBooks 2011 will not have a free document management plan due to a change of accounting policies. The email they recently sent to QuickBooks users said:

Free Document Management will be discontinued in QuickBooks 2011

What’s Changing?

Document Management is free in QuickBooks 2010, and it will stay that way. But after May 15, it will no longer be free in QuickBooks 2011.

Why?

A change in our accounting policies requires us to stop offering free services in any version of QuickBooks after 2011. We’re not happy about it because we know Document Management could be an integral part of how you do business.

Waaaa? It’s an accounting software company, you’d think they could figure out a way to not let the accountants drive important business decisions. Does this mean that Intuit will never offer a paid version of Mint because they’ll have to end the free version? Does this mean that no packaged software companies can do a freemium upsell model for attached services? If the latter is true, will a company like Microsoft – that makes a lot of money off of one time installed software – be totally unable to acquire freemium SaaS companies? Will Intuit never be able to acquire a freemium company like Box.net? This seems nutty.

I just don’t get this move by Intuit, unless the real reason that the free plan is being eliminated is because they just aren’t making money off of the free to paid upgrades and this is a way to kill off the free plan with an excuse that is so obtuse customers are unlikely to question it.

What do you think? Are the accountants just running the show at Intuit and forcing business decisions to be made off of accounting rules, or is it likely that the free plan just wasn’t working for Intuit as a business/marketing model?

Here is most of the email that I was able to screen capture:

QuickBooks discontinues free document management

Note, I have no info other than this email about Intuit’s document management policy change. And these opinions and questions are 100% mine, having nothing to do with my employer.

A good piece from Fortune about Apple’s announcement that they would take 30% of subscriptions sold through the app stores…

http://tech.fortune.cnn.com/2011/02/22/the-cost-of-apples-greed-tax/

Supposedly Steve Jobs responded to a developer’s email about this by saying:

“We created subscriptions for publishing apps, not SaaS apps.”

That would make me happy if it is true…

I’m very pleased to announce that OfficeDrop has launched our first app in the new Mac App Store. ScanDrop Mac Scanner Software connects your Mac’s scanner directly with popular cloud storage provides like Google Docs, Evernote and OfficeDrop’s own cloud filing system. I’ll keep you updated as to how this new distribution channel does for us, especially since this is a paid download. Go to our listing here: http://itunes.apple.com/us/app/scandrop/id412518240?mt=12

We are launching the app for $1.99 in the app store, although we “pre-released” ScanDrop with a great piece of press from Lifehacker last Friday. You can also learn more about ScanDrop on our Mac Scanner Software page.

As I mentioned in a previous post, my company recently did a lot of cool testing during our site redesign. Anand Rajaram, OfficeDrop’s co-founder has a series of posts on Performable’s blog that talk about tips, tricks and tools that we used during the process:

Optimizing Conversion Rates Part One – Quantitative Tests

Optimizing Conversion Rates Part Two – Qualitative Tests

Optimizing Conversion Rates Part Three – Lessons Learned