“I thought you said it would be free?” “It probably will be, but we still have to add your card.” “What do you mean ‘probably’?”
I think some people underestimate how cost-sensitive some clients are. And how time poor some small businesses are.
Those aren't "clients", they're "moochers".
If they're prepared to walk away because it costs them $35/month to send to their mailing list, you probably owe it to yourself/your business to spend your time seeking new better clients rather than talking them thru how to get stuff/service for less than $35/month... Your business should be "cost sensitive" as well...
Freeloaders are simply not in my market.
And with that focus, I've been able to exponentially improve the value of what my company provides.
Our business found Mailgun to be a great solution when we anticipated clients would stick under 10k/mo and not need a card on file. With Stripe, every time they pay their cut, they've had a sale. Every time they mail-out through MailChimp, it's to a list of customers.
We are usually using Mailgun to send transactional emails. I can't promise a client that they won't get a flurry of junk signups or password reset mailouts that hit their credit card.
The bottom 50% of the market is heading to self-serve site-builders and it's savage for a small web business.
Start charging your clients money to cover costs that comes with their business.
My original point was not even anything to do with cost but hassle!
Discount stocks brokers make more money on float than trades.
Search engines make enough off ads instead of charging per search.
Photoshop didn’t have a free tier, but rampant piracy from home users created proficient corporate users.
e.g., I can set up their account and other technical parts after that, but I can't verify their mobile number (added since we started working with Mailgun), don't have their credit card details to put on file (same), and often end up agreeing to legal notices for them rather than asking them to complete signup (and stalling the project).
The responses to your posts are disgusting. I don't think a lot of people around here understand what it means to provide services to small local businesses.
I don't know about you, but I'm in a smaller community, people here still earn $7.25 per hour, and I just don't have access to deep-pocketed big businesses. I work with small businesses, individual business owner/operators, and mom and pop type places. $35 here, $50 there - it all adds up fast, and they are very conscious of these costs, and so am I.
Going to a small business owner and trying to explain any kind of price hike for a service they thought was free is just another burden to them, and it makes MY recommendation of the original service seem bad .... and I'm the guy they came to for GOOD advice.
If your advice was "you get 10,000 emails per month free via $service" without qualifying "right now, but that isn't guaranteed forever, their paid tier is $x per 1000 emails and switching mail providers in the backend of your website will take approximately $Y hours at $chargable_rate", then it _was_ "bad advice" (or at the very least "incomplete advice").
I made this mistake way to many times before I learnt that lesson. (Most recently with Google Maps on websites...)
I think most HNers currently serving mom-and-pops in a bespoke fashion should strongly consider exiting that market tomorrow. Those customers will, over time, gravitate to a Shopify or a site builder or similar because they can amortize engineering costs over 100,000 similarly situated customers and consultants can not.
I understand there are aesthetic reasons to prefer that non-tech-forward people in your local community have someone to ask questions to and help navigate options, but if you want you can throw free Set Up Your Shopify office hours every Friday as a pro bono gesture, underwritten by the piles and piles of money from the many businesses in the world that can afford professional labor.
Your problem cascades from a B2C approaches to a B2B relationships. Not just yours to your client, but Mailgun's B2C approach to its relationship with your business. Free commercial email is likely to be unsustainable. At best, it's money left on the table because at 10k emails a month, there won't be many conversions. They were delivering free to a customer who expected free with the same damage to the customer's perception of the relationship as between you and your client.
The only part under your total control was whether or not to charge your client money. If you had, then the bad part would be Mailgun raising its prices. You would have had the option of eating the cost. Or having the unpleasant conversation with your client.
Maybe there's something slimy about charging a client for a free tier mail service. That's also under your control. Just pay for a paid tier and pass along cost at normal markup. In the long run, and that's what B2B relationships are about, it will tend to be simpler and simpler tends to be better for everyone.
I've worked in this industry for over 20 years and found that the more complicated your explanation, the less likely clients are to want to work with you. Being a stick in the mud on usability is another example - they'll leave for someone who'll make them a splash page without question, etc.
As long as you understand the risk you are carrying you can price out the externalities of it going south.
To explain that, consider this artificial example made up based on what you just wrote; "I have a lot of clients using MailChimp's free plan ..."
Now lets say MailChimp has a tough few quarters, maybe they get a new CEO or maybe they just need to get more money for their services than they currently do and so they revise their "free" plans into non-free plans in ways that prevent some chunk of your customers from using their free plans.
Your customers are forced to change their previously working system for a different system. Four outcomes pop out of that event; They can use their current system but now it costs them more money, they can hire you (more money) to come up with another free system which they now know will only last for some random period of time, you can design a new system for them for free (costs you money), or they can go with a new contractor who will design a new system for them.
As the original provider of the system, you cannot predict when this event will occur. It may occur at a slow time, it may occur on black friday when it the customer's busiest time of year. And as the original provider you cannot predict the new cost of the system, or the cost of a replacement system.
So the risk you are carrying here is mostly reputational (some of your customers will say bad things about you if this event happens at a bad time or costs them a lot of money they were not expecting to pay.) Depending on what type of warranty you provide or imply for your services (most people disclaim these so the common case would be to leave the customer with the costs) you may be carrying some financial risk to correct the future situation.
I will reiterate that there is absolutely nothing wrong with carrying this risk, as long as you are aware you are carrying it. Because you can plan for the various cases (for example by continually researching equivalents to MailChimp so that in the event this happens you can quickly and easily move your customers over to the new solution)
When are they coming to an end? I'm also grandfathered in, and haven't heard about this.
I have a SaaS product with a free tier (like Mailgun) and I have had an app/game which was free with an upgrade.
(My initial point was not about the freemium model but about other changes that have made working with Mailgun difficult.)