[thih9]

Capture customers and unreasonably hike the prices is a business plan as popular as subscription services. I hope consumers and businesses will notice how unreliable this is and start choosing more user friendly products more often.

[tsukikage]

What should they choose? Today's more user friendly products are just tomorrow's unreasonable price-hikers that haven't captured enough customers to start enshittifying yet. Meanwhile, even without network effects, migrating to a new product is usually a hassle; the frog has to be quite thoroughly boiled before it's worth it.

[latexr]

> What should they choose?

Products which aren’t subscriptions to begin with, so the company can’t hike the price from under them with little notice and leave them in a position where they’re forced to pay and bleed money every day they fail to find an alternative.

[lancesells]

I did that with Affinity software which was purchased by Canva. Currently they don't have a subscription but I give it a year or two and they'll either have subscriptions or it gets folded into the Canva subscription.

[latexr]

Even if they do that (they explicitly said they won’t), that doesn’t stop us (I also have Affinity apps) from indefinitely continuing to use the versions we already have. So buying non-subscription software was provably the better choice.

https://news.ycombinator.com/item?id=41434110

[tsukikage]

Software does not exist in isolation. I am acquainted with a number of people and organisations who deliberately keep otherwise obsolete equipment running obsolete operating systems in order to indefinitely continue using old software instead of paying for new versions and/or switching to a subscription model.

While it is certainly a choice, and one people demonstrably make, it comes with downsides and tradeoffs - it is not unambiguously better.

[latexr]

I don’t think you did it on purpose, but that’s a straw man. Most software that works on one version of an operating system doesn’t break on the next, and they’re not released that often anyway.

And if you really need it, you’d be fine not upgrading until you find an alternative. Which with non-subscription software you can do at your own leisure. That’s my point.

https://news.ycombinator.com/item?id=41434030

[arder]

This is just capitalism though. Like, what else are you suggesting? Opt for companies whose products are more expensive in the hope that they are less likely to hike prices later on? The real issue is when these companies become monopolies and then can raise prices without paying a competitive cost for doing so. But that's not Canva.

[Lutger]

Maybe this is a really crazy idea, but businesses could compete on the free market, winning customers with superior products and services? And use revenue to grow?

The initial investment to start a company, especially a tech company, isn't all that big anymore.

[jakelazaroff]

Is that not what Canva is doing? They’re raising prices because they think their product is superior. If they’re wrong, their customers will just switch to another product!

[Lutger]

I'm referring to the 'capture customers and unreasonably hike the prices' business model, which intends to make profit of exactly the cases where a customer is NOT a rational agent, just like scams do. I'm not saying that's all there is to Canva, just making a general remark about these kinds of business models.

Because yes, in theory a customer can 'just' switch to another product. In reality though, there are various reasons why it isn't so easy. Customers get invested with their time, build skills, have projects, or just plain inertia. It takes some mental load to compare alternative products and make the switch. People are busy.

We don't think of bait-and-switch business models as scams, but once you see them as basically scams-light it becomes clear it is at least an open-question if their existence furthers the glory of the free market, or hinders it. We don't have a problem seeing scams or criminality as basically obstructing a free-market.

Eventually Canva will perish if they make the deal bad enough, unless they somehow achieve a monopoly or sales stranglehold (my term), but not before they squeeze a good few bucks out of frustrated users. If they are successful enough at it, it hollows out the market.

[jakelazaroff]

I don’t think the point of this price hike is to profit off of non-rational customers. I think it’s likelier that they expect and maybe even hope that they’ll lose customers.

Let’s say a full 50% of Canva’s customers eventually churn because of this. They’re raising prices 3x, so they’d still make 1.5x their previous revenue. And they’d make even more profit, because their customer support costs have been cut roughly in half.

Meanwhile, the 50% of customers who dropped are now on the market for a new design tool — and a big hole has just opened in the low end of the market. So it’s good for competition, too!

Of course, if 80% of Canva’s customers leave, that’s bad for them. It’s a gamble! But in general, increasing prices by Nx in hopes that you’ll retain at least (1/N)x customers is a totally reasonable strategy.

[barrell]

How much are you lowering the satisfaction of those users though? Sure you may end up with more cashflow, but a much smaller, less eager group of users to be promoters.

The point of this is imho likely to boost the numbers as much as possible prior to IPO at the expense of the UX, brand, and by extension product

[barrell]

This is just shareholder* capitalism. Capitalism itself does not inherently put the share price over users