The "small" book of big WordPress plugins & prices (Part 1)
Hi, my name is Raitis Sevelis and I have analyzed the prices and licenses of the most popular WordPress plugins. All these plugins represent different categories but have a freemium model in common. This is what I found. 👇
The barrier for entry 🧱
If you have decided to enter the plugin business, it is worth knowing which industry has a lower barrier for entry. So you can compete with your new plugin.
We will put our skills aside and assume we can build anything, from SEO tools to membership management platforms.
Our main criteria will be competition, pricing, and market size. Every industry will be evaluated from 1 to 5. Higher prices, lower competition, and larger market size - all give higher marks.
From these grades, we will create averages - the higher the mark, the more appealing the industry is.
The results are in. Are you surprised?
It seems that donation and security plugins dominate the list while popups, page builders, and form builders are at the bottom. Let's look into possible reasons and other, less obvious, findings:
- While there is a huge market segment for page builders and form builders the competition is fierce and the average prices are low (we will look into average prices in the next chapter). This puts them in a really competitive position - still we see plenty of new plugins joining the list.
- Popup and social plugins both have large market segments, but are priced low and have tough competition. Moreover, popup and social features are often covered by other industries (ex. analytics and page builders) that make it even harder for a new business to make it to the top.
- Donation plugins can be considered niche plugins, yet there is low competition and to my surprise - their pricing is among the highest in the WordPress plugin ecosystem.
- Security is everything and everyone is obsessed with it. Although there is a decent amount of plugins available, the pricing and the market size tell us it is worth giving a shot.
- SEO and eCommerce are industries with fairly high grades. But how about Yoast SEO and WooCommerce that have dominant positions? Well, having one strong player in the industry always creates an opportunity. It is something we can see with the RankMath slowly getting a decent piece of cake. If you ask me - this may happen in eCommerce as well (and we know that eCommerce is booming).
Note: In the analysis, I have skipped several niche industries that can still bring very interesting business opportunities. As always, I encourage you to look into the raw data yourself and share your findings.
I would like to stop here since we can come up with tons of hypotheses and conclusions in the form of a separate article.
Plugin prices: high and low
We already touched on this topic in the previous chapter.
Now, let us dive into what are the average prices of plugins per industry. We'll determine the most and least expensive industries and their medians.
Note: In statistics and probability theory, the median is the value separating the higher half from the lower half of a data sample (from Wikipedia). In other words, we will cut out insignificant price occurrences and focus on the majority. 📖
In the plugin business, not everything is how it seems. The industries that look most promising for us, in fact, offer significantly lower prices. Add stiff competition and you will see that there is less room for building a sustainable business.
Moreover, plugin complexity is by far not the most important factor when it comes to price range. Plugins with limited functionality may charge twice as much as some feature-rich tools.
To see what I am talking about, I have created a table with industry average prices for single licenses and their medians.
There are clearly industries that have a way higher average price range than the majority of WordPress products. Security, membership, multilanguage, and donation are among the leaders. Followed by the cache, image optimization, backup, and booking, they form the largest budget for the projects.
At the same time, industries like file managers, form builders, popups, and a few more look undervalued.
Of course, demand across those industries varies a lot and it can impact prices as business owners need to support their business. Nevertheless, just like in the previous chapter, there are several industries that may look appealing to new players.
To get a full overview and do the research yourself, I encourage you to look into the raw data.
But before you move on, pay attention to the significant differences between average prices and medians that several industries have. What does it mean? A difference between those numbers gives us a hint that there are businesses that either overprice their plugins or corrupt the market by dumping prices (get into the market segment or fight the competition).
I hope that this chapter can help you in planning your projects' average budgets and save time while looking at potential (read meaningful) savings. Maybe we were spending our time on finding cheaper alternatives in the industries that form less than 5% of all plugin spending.
Did you enjoy my findings? If you want to reach out to me, feel free to join the Facebook group 'WordPress for Business' with other WordPress professionals.
As a plugin owner, you may not like it, but refunds are a part of the business. We will look into plugin refund periods and see what we can learn.