Archive for November, 2007

Shalach Monos Pricing Details: Should you charge a “setup” fee?

November 1, 2007

Charging a setup fee for your purim project is not user-friendly in that you make it prohibitively expensive for those people who only want to send to a few people. Your members that plan on sending mishloach manot to many people will do so regardless of whether you charge a $20 setup fee and $2 per recipient, or simply $3 per.  You will probably make the same amount of money from these “big spenders” regardless of pricing, but you risk alienating those members who only want to send a purim basket to 2 or 3 people (those members who don’t know a lot of other members, but may be interested in sending to the Rabbi/s and Cantor). Yes, you won’t make the $20 set-up fee from them, but there’s a good chance they wouldn’t have spent $26 to send mishloach manot to 3 people—but they would likely spend $9 to send to 3 people without thinking twice.

If your logic is that people should cover the cost of their own baskets, a setup fee won’t necessarily achieve that.  Your members are paying to SEND greetings, not receive them.  If a person doesn’t participate, but someone sends to them, they’ll still receive a basket, despite not paying your setup fee. 

We would also recommend against a setup fee for reciprocity for the same reason that it may keep people from choosing this option. Reciprocity is a great feature that usually helps you raise more money by serving as a “catch-all.” That is, it is intended as a backup in case someone sends to you, and you didn’t send to them—you would select this option to ensure that everyone who sends to you receives from you. As the administrator this hopefully increases the total number of names selected, and thus, the money you raise. A problem arises when your members rely on reciprocity and either don’t place an initial order at all, or a very small one.  At HappyPurim.com we do not allow “reciprocity-only” orders because we must capture the members credit card to charge them for their reciprocal order.  We can also setup your account to require a minimum number of baskets to be ordered in order for the member to select reciprocity.  The best idea however, may be to charge a higher amount, but not much higher, for reciprocal orders.  For example, if you’re charging $2 per regular recipient, you may want to consider charging $2.50 per reciprocal.