Listen to Episode #23: The 37signals Suite

Matt Linderman: Welcome to the 37signals Podcast. I'm Matt Linderman. Today we're going to be talking with Jason Fried and David Heinemeier Hansson about the 37signals Suite.

Basically that's where you get Basecamp, Highrise, Backpack and Campfire all together for a discounted price that's lower than you'd pay for them individually. You also get simplified billing and you can use the same users across all the apps.

If you want to see more info on it you can go to 37signals.com/suite. Here's Jason Freed explaining why we came up with the suite and more details about it.

Jason Fried: Yeah, we're definitely excited about it. It's been something people have been asking for for a long time, although they've been asking for it in different forms. Some people call it integration, other people call it a bulk discount. Some people just want to get a discount on just two products, not four. So there's a lot of things we were hearing from customers over the past... It's really been going on ever since we've had multiple products. So for a few years at least.

Our decision for the initial version of the suite, which is what we launched was, it's primarily offering three things. It's offering a unified price for all four products, starting at only $99 a month, so it's a really good deal.

That deals with the, "I'm paying a lot for multiple products. I don't want to do that anymore." That solves that problem.

The second thing it offers is unified, simplified billing. You get one charge from us. You can be using four products but you just get one charge on your credit card. That just makes it a lot easier for everybody.

And lastly, it unifies the users across all the different apps. In the past, if you had Basecamp and Highrise and Backpack, you'd have to create separate user accounts in each one even though the people were the same. And that's kind of a real hassle. That's taken care of now, too.

That's what the initial version of the suite is. We have a lot of ideas for integrating the products themselves a bit more, but initially we wanted to hit price, simplified billing and unified users. And we did hit that. So far the response has been really, really good.

I know I'm surprised by the amount of people who've upgraded to the suite in just the first week. I'm really happy with that so far.

David Heinemeier Hansson: One thing that's interesting there, too, is we chose to roll it out in stages. Right now you can actually only upgrade to the suite. You have to have one of the existing products and then you go to your account screen and you click upgrade. We don't have a way for you to buy the suite just as a new company. You can do it by just buying one of the other products and then upgrading. But that was a way for us to cut down a little bit of the complexity in this.

This was already a long running project, how can we get it out now rather than just spend another three months on it?

What we realized was, if you were able to sign up for the suite right away, we would need a really good way of telling you about all this new software you just got. If you buy all four products, that's a lot of software.

Basecamp is already a pretty substantial offering. It takes time to get a company to adopt that. It takes time to get your data in there and get rolling with it and just get into a groove with it.

Imagine if you have to get up and running on Basecamp, Highrise, Campfire and Backpack at the same time. That's actually a pretty significant task and right now we're not doing any job at all to help you with that task.

We can certainly help you solve that problem by just having a much better on-ramp experience, teaching you about what kind of data you would put in to what kind of product and where do things go. But today we don't. All the products are optimized for: "You just have Basecamp. Let me teach you how to use Basecamp." Not knowing that you might also have Highrise.

Matt: Here's Jason talking about coming up with the pricing for the suite.

Jason: We thought a lot about pricing actually. We sort of went all over the place with it, but we knew we wanted to start with $99. Actually, at one point we talked about $79 I think, at some point, but the plans were different. So it wasn't like the same equivalent number. But we wanted to start at $99. We played with a lot of different prices above that.

We knew we wanted to just have three options though and not five or six. I think some of our products have too many options. I think with Highrise there's like six different things you can sign up for, which is just too much.

We wanted to go with three and it seemed like a natural jump, from $99 to $149. Just about 50 percent more, but you get a lot more stuff. And then the high end, it's really quite a boost.

You get like three times the storage and a considerable amount of storage and a bunch of unlimited limits. Or actually, no limits, because they're unlimited. So we priced that one at $249.

I think, based on the sales so far, the break down is kind of following... It looks like it's sort of following the curve that we have for Basecamp, which is good. Obviously, a lot more people on the low end and then fewer people moving up, but the percentages seem to be pretty good so far.

I think we're pretty happy with it, at this point.

David: One of the considerations we had was, we wanted the suite to sort of be the premium product. With some of the other products, we have lower entry points where you get into them. The suite is definitely for people who really just like what we do. They're already probably engaged in one. It falls into the whole story about why this is upgrade-only right now. They're already engaged with one product. Here they're getting everything that we do, the best of everything. And we don't have to sell that for $19. That would be selling ourselves short.

We're not afraid of actually charging a reasonable amount of money for all the stuff, all the software we've been working on for the past six years. You're getting all of it. You're getting the best version of everything we've been working on for the past six years.

That feels like it's worth $99. And we're thinking about it again too... If I was a company sitting somewhere trying to get organized or whatever, all of these things our products do. From Campfire to Basecamp to Highrise. Is $99 an unreasonable sum?

Would that feel like too much? Would I not pull out my credit card for that? It didn't fail that test. I was thinking, "Yeah, I'd pay for that." That would actually probably be the most important piece of software for another company I would be involved in.

And for the most important piece of software, paying $99 a month? That doesn't seem that unreasonable.

Jason: The other thing we thought about was, we wanted the price to basically be the price of just about two, but you get four. If it was the price of three for four, that's not that attractive. But it people are going to have two products anyway, getting two more for about the same price. Really it's a buck more, kind of, if you're on the plus plans. It just felt like the right combination, the right number.

One of the things we're really happy about is, almost all the feedback we're getting from people is like, "This is one hell of a deal. This is awesome." It's either "I'm saving 50 bucks a month"

Or, "You did get me to upgrade, but I totally feel like it was worth it. Now I've got a bunch more stuff that I didn't have before." Everyone's been really, really happy.

We've only had a few complaints about price. Just a few is a really small number for something like this, when we're charging at least $100 a month. So I think we hit the price points just right.

Matt: I asked David how the large scale of the 37 Suite project worked into our team-based way of working, which is usually three people on a team working on an iteration for two weeks at a time. Here's his response.

David: It doesn't fit and that's been somewhat of a challenge. Because most of the work we otherwise do is smaller feature improvements or something else we can fit in, in the 1-3 week cycles that we do. This didn't fit into that at all. It didn't even fit in to the two month term cycles that we do. So it was like an offshoot project. It felt a lot like 37 ID in that sense. It's a large infrastructure project that sometimes you've got to do. It won't fit in with your natural process.

It doesn't fit in with a lot of the other things that we're generally good at. Which is estimating one or two weeks worth or work.

When we started out with this... Again we actually started out with completely unrealistic expectations about how fast we could do it, which is very similar to how we started out with 37 ID.

Both of these mega-projects started out thinking, "You know, we could do this in like a month. Maybe six weeks." And it turns out it takes more like three or four months to do. Some of it then... It just turns into, it's done when it's done.

And that's generally not how we like to work, but it just seems unavoidable with these things. There's just no way we are going to fit this in to two week iterations. So it's definitely just a challenge.

I'm happy that we did it and I'm happy that we're done. It feels nice to get back into a regular cycle of doing smaller iterations. It seems like that's generally what we're better at.

We're better at running shorter, smaller projects than we are at running mega-projects.

Matt: Alright, that'll do it for this episode of the podcast. Thanks again for listening. You can go to 37signals.com/podcast to see previous episodes and to find transcripts and related links to each episode. And also you can go to 37signals.com/suite to learn more about the suite.

More episodes of the 37signals Podcast.