How to Price Your WordPress Theme for Your Business

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Coming up with pricing for your WordPress themes can be tricky. After all you need to find the right balance to make sure that you are making the most out of your business while offering a price that your customers will pay.

ThemeForest offers themes for sale between $35 and $60. This means that there are incredibly cheap themes out there on the WordPress market. And, sadly, the case is that some buyers don’t care about code quality, they just want something that will look good on their website.

But you need to cover your costs. With that in mind, let’s take a look at a hypothetical situation for calculating your pricing.

Dave Starts a Theme Shop

Dave isn’t interested in being an independent developer anymore, instead, he wants to run his own business so he’s decided to start up a theme shop. He wants to figure out how to price his theme. The theme took 40 hours to design and code, and if Dave worked in development for another theme shop he’d be earning ~$50 per hour. This is a fairly modest rate as Dave could be earning a lot more as an independent developer, but let’s go with that for now.

The cost for initially building the theme is: $2000

Calculate your Maintenance Costs

WordPress has a fast release cycle. A new major release appears about two to three times a year, this means that Dave has to spend time maintaining the theme. Let’s say it takes him five hours per release and he does two releases a year.

The cost of maintaining the theme for a year: $500

Total cost to build and maintain the theme over one year: $2,500

Great! So Dave has calculated the overall cost of the development time for his theme over the year. Note that this doesn’t include any additional software he invested in.

In order to compete with ThemeForest, Dave decides to sell his theme for $35. That means to break even, he needs to sell around 70 themes. That will cover the entire cost of his development time.

However, despite figuring out the development and maintenance costs, Dave has forgotten to calculate his support costs.

Calculate your support costs

Dave sells his 70 themes and over the course of the year, each of those 70 users makes an average of two support requests a month. A support request takes 10 minutes, on average, to solve from the ticket being opened to the ticket being closed. That’s 1680 support requests over the year, taking a total of 16800 minutes, so 280 hours. Those support requests will cost Dave a total of $14,000.

Dave is starting to feel depressed.

The total cost for the theme development, maintenance, and support is $16,500.

If Dave wants to break even with his 70 sales, he’ll have to increase the cost of his theme to $235.

Or, he can increase the number of sales he makes. To make $16,500 in sales, Dave would need to sell 471 themes at $35. But then his support costs would increase dramatically.

The Theme Club

Instead of selling just one theme, Dave decides to go down the route of creating a Theme Club.

While still offering single sales, many theme shops offer access to all of their themes for a fixed price. Let’s take a look at some of the different pricing structures:

Elegant Themes

  • Standard Membership: $39
  • Developer Membership: $89
  • No single sales

WooThemes

  • Standard Membership: $125 Startup Fee + $20 per month
  • Developer Membership: $200 Startup Fee + $25 per month
  • Single Themes: $70 – $200

StudioPress

  • Lifetime Membership: $349.95
  • Single Theme (including Genesis Framework): $79.95

Dave realises that to set up a theme club he will have to have a number of themes ready for his launch, and release a theme every month to compete with the big theme shops.

Here are his costs based on the creation of six themes:

  • Development Costs: $12,000
  • Maintenance: $3,000
  • Initial Costs: $15,000

To cover the support, Dave decides to invest some money in paying for a support rep. This will cost him $3,000 per month – $36,000 for the year.

His total costs for the year will be $51,000.

In order to be competitive he decides to price his theme shop membership at $89 per year, and his single sales at $45.

He will need to sell 573 theme club memberships to break even.

If Dave sells 600 ($53,400) theme club memberships and 500 ($22,500) single sales his turnover will be $75,900 and his profit will be $24,900.

Of course, that doesn’t take into account all the time that Dave spends marketing and working on the business himself.

Pricing Your Own Themes

Dave’s situation is particular to Dave, and when it comes to setting up your own theme shop you’ll have your own cost considerations. You may want to bring down your development costs by outsourcing some of the development or offer support packages separate to your theme sales. However you’ve chosen to calculate the costs of your theme you should always take into account the following:

  • development
  • maintenance
  • support

And if you really want your theme shop to grow you should take into account marketing time and costs too.

A Note on Theme Complexity

If you have a simple theme that just involves installation and a small amount of set up, then your support costs will go down. Likewise, if you build a theme that is very flexible with lots of functionality, your support costs will go up as users will try to push the theme in all sorts of directions.

You’ll also find that with theme frameworks, people will set up their own development shops utilizing just your framework. This means that the user will be making money from something that you sold to them relatively cheaply. These types of users may also be a drain on your support as they often have lots of complex questions. In this scenario it may make sense for you to offer a developer package with ongoing support costs.

It’s important that you remember that the greater the complexity of your theme, the higher your development and support costs.

Tweaking your pricing

Remember that your theme costs are not set in stone. You should always adjust and change them in response to your business needs. It’s important that you find a balance between keeping your customers happy and ensuring that you are making a profit. If you feel that you aren’t making enough money for the effort you are putting in, or if you want to invest more money into your business, increase your prices. You can always keep your current customers on an older plan and introduce new pricing for new customers.

Conclusion

Getting the price right for your theme is not an easy job. It takes time to calculate your costs and effort to research into how many customers you think you will get. But thinking it through from the start will ensure that you have a constant grasp of how you’re doing and where you’re going. It’s not that difficult to start selling themes, but it can be difficult to turn initial sales into a sustainable business. Make sure you do the groundwork before you jump into it.

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Author: Holly Bentley

 http://wordsforwp.com

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