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0:00:13.6 Chris Ronan: Hey everybody, welcome to Inside Geocaching HQ, where we talk about what is happening at Geocaching HQ in Seattle. I am Chris Ronan. My Geocaching is Rock Chalk, and I am one of the Lackeys who works for HQ, and we appreciate you having to listen to our podcast. Today, we are discussing the recent announcement that on June 6, 2023, HQ, will increase the prices of Premium membership for new subscribers to 39.99 USD per year or 6.99 USD per month, prices may vary depending on your local currency and taxes, and very importantly, this change will not affect existing Premium members, so long as their membership does not lapse. If you would like to take advantage of our current prices, Please upgrade to Geocaching Premium by June 6th, 2023. I had a chat with HQ’s President and Co-Founder, Bryan Roth, about this update, the reasons for it and what it means for HQ and the Geocaching community going forward. So let’s get into it.

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0:01:33.0 CR: Well, Bryan, let’s talk about this news about the price changes for Geocaching Premium, I know this is something that has been top of your mind now for quite a long time leading up to this announcement, so maybe we can just start by talking in general about it, and then maybe get into more of the details of it.

0:01:51.8 Bryan Roth: Sure, sounds great, Chris. First, hello and happy geocaching to everybody out there. As I think most people know by now, because we sent out a bunch of different communications on June 7th, the Premium membership prices are going to increase, so this is a price in previous, I think everybody out there is probably hearing a lot from different companies, you know it. Because like we hear from Netflix every so often, and then YouTube TV and Comcast or whatever it is, but the people are raising their prices, and I think that’s a result of increasing costs in general for us, Jeremey and I have been talking for a while, and we’re very, very focused on the metrics that are required to keep the business operational, and quite honestly, over the last 21 years, the costs have increased substantially, but really in the last, I don’t know two years, the costs have gone up quite a bit, and I think there’s a lot of news about inflation and things like that. But I can tell you as a company, there are a lot of things that go into running this business, we’ve got salaries and rent and utilities, and server costs, and hardware and computers, and there’s just so many things.

0:03:06.8 BR: And the reality is that the prices on those things have gone up substantially over the years, but particularly in the last little while, and so we got together and we said, “Alright, it’s been 21 years, but we wanna make sure that this company is around and available for ideally, generations to come, the service we’re providing to the community, we think is really important, we want more people outside. We wanna be part of a solution that inspires people to get outside and have their adventure and exploration and build community. And so, it’s important to keep the company viable long-term, and while it’s not a near-term issue, thankfully, we really do need to be proactive and plan for the future, and we recognize that cost will continue to go up. And so we decided that we would do a price increase, the first one in 21 plus years.

0:04:01.9 BR: In doing that, we decided that we didn’t wanna do it the same way that everybody else does it. We don’t have to because we’re a community-based business, we’re serving this global community of players. And so one of the things that we wanted to do was acknowledge that Premium member support is what got us here. It took us 21 plus years of Premium members all around the world paying for a Premium membership and getting access to the features and functionality, but also giving us the resources to hire talent, pay for our business costs and continue serving in the way that we are hoping to serve. And so unlike other companies who say, “Hey, everybody’s price is going up,” we said, well, “How can we do this in a way where current Premium members aren’t affected, and also the Basic members who are out there and playing the game and supporting us in their own way with cash hides and event participation and hosting, and all the other things that go along with Geocaching that aren’t specifically Premium membership. How do we make sure that they don’t have to necessarily be affected by this price increase?”

0:05:11.6 BR: And so, what we decided to do was we would set a date, the dates June 6th, and we’re asking people to either remain subscribed or consider subscribing by the end of June 6. And if they do, then this price change will not affect them. And so one of the questions that has come up is, some people have said, “Oh, I can get this new price for a year, or do I get this new price forever. How does it work?” And what I can say is we have no plans to raise the legacy price at this time, but I can’t guarantee the pricing won’t change in the future. What I can say is, in the early days, when we first started Charter memberships, Jeremy made a promise to the people in the forms, “Hey, if you subscribe now your price won’t change.” And so at least for that group of approximately 400 remaining Charter members, I think we’ve got an obligation to keep the price the same, otherwise I don’t expect any near-term price changes. Again, it’s been 21 years, and the goal at this point is really to express our gratitude to Premium members by saying, “Thank you for being a Premium member, you get to keep your Premium member price,” and also to Basic members to say, “Thanks for being part of the geocaching community. We recognize you don’t have to be a Premium member, but if you wanna lock in this current price right now, we’re giving you quite a bit of time to do that.”

0:06:28.3 CR: Did you describe how important Premium membership is to powering Geocaching HQ in the work that is done here, relative to some of the other revenue sources that the company has such as Shop Merchandise or Trackables or GeoTours, there are some other things that are done, but Premium membership is an awfully important aspect to up to everything.

0:06:55.2 BR: In reality, Premium membership is the most important revenue source that we have as a company. Things like Shop and GeoTours and Trackable sales, and some of the commercial Adventure Lab projects that we’re working on, make up a very small percentage of our overall revenue. And so it’s funny, I saw somebody on Facebook the other day in response to this price increasing like, “Oh, with the money they’re making from shop, like surely they can cover all the cost of Geocaching,” and while I wish that was true. It’s so far from the truth, and it really isn’t close to doing that. Premium membership and the support from Premium members around the world is the primary reason that we are able to run this business, pay our employees, pay our office rent and other expenses. Without the support of Premium members, we would not be able to do this, period. There’s no other way to describe it. And so, please come to Shop Geocaching, they’re always adding new things, and they’re excited to show off to new customers, we’ve got new products coming in the near term as well, visit the GeoTours play the Adventure Lab, Adventure Lab experiences. But if you can, if you are so inclined, please continue to be a Premium member, please subscribe for Premium membership, that’s how we keep this business funded.

0:08:18.9 CR: What has the philosophy been over the years for you and the other co-founders, Jeremy and Elias, when it comes to talking about this topic. Because as you said, it’s been 21 plus years and prices have been going up pretty much for 21 plus years, and all of the equipment and all the stuff that you mentioned during your answer earlier. So this must have been a topic that you guys have been discussing at least at times over the years, and I’m curious, how have you approached it, what is your philosophy been as an ownership group, about how and when to do something like this? Why do it now as opposed to five years ago or five years from now or whatever?

0:09:00.7 BR: So over the last couple of years, the prices have gone up on a lot of things, they’re going up in an IT sense of our service providers, the fees to deliver bandwidth and maintain servers and co-locate servers are going up by 20 to 50% year over year, which is, it feels a little unsustainable employment costs, you know we’re in Seattle, it’s a competitive technology environment, and we pride ourselves on taking good care of our employees. And so the cost of employment and healthcare and things like that have gone up, and so while maybe five years ago, 10 years ago, the effects of this didn’t feel so pronounced, they’re definitely feeling more pronounced now.

0:09:42.6 BR: And I think any business owner or any company out there has to be thinking about how they respond to the increased costs in the business environment, and so it felt a bit more pressing, now. Again, we’re not in a bad place at all, I think the goal is to prioritize long-term sustainability for the benefit of the community. And so in the interest of doing that, we’re saying, “Okay, let’s get a price increase in place, let’s not have it apply to current subscribers, let’s not have it apply to any Basic member that wants to lock in the current price, but let’s see if we can bring more financial resources to the company which will allow us to continue sort of operating in the way that we’ve been operating, but also maintain our effectiveness and ideally increase our effectiveness and deliver more joy to the world through Geocaching.

0:10:38.2 CR: I know that a lot of folks at HQ worked very hard to try to make the communications about this as clear as possible, but was there any confusion during the course of the announcement or anything that you’ve seen since then that you’d like to talk about?

0:10:54.0 BR: Oh, sure. That’s a great question. Thanks, Chris. So one of the points of confusion involved some of the messaging that we had out there. In that messaging, we said that the new prices would be 39.99 USD per year, and 6.99 USD per month. The mistake that we made was using the word “and” because it’s an “or.” And so some people who are out there saying, “Oh my goodness, it’s 39.99 plus 6.99, a month. That’s 120-something, whatever dollars, USD.” And that is not correct. It’s an “or”. So customers have the choice, if somebody wants to experiment and check it out, they can subscribe at 6.99, and if they decide that they’re in and they wanna become more of a geocache actively and they want the benefits of Premium membership, if they wanna support the hobby in the way that many other Premium members do, then they can choose to get an annual subscription at 39.99 USD.

0:11:55.8 CR: So is there anything for Basic members that will change with these price changes that are affecting Premium membership?

0:12:04.4 CR: Actually no, Chris, nothing will change for Basic members, and what that means is that all of the Geocaches with the exception of the Premium member-only caches, will be and continue to be available on the website for free to Basic members. There are tools and features and things that are available on mobile that are only on Premium members, things that are available through API partners by our API only for Premium members, but all of those things have significant costs and the Premium memberships really go to pay for those costs. And so Basic membership will not change, you can continue to play for free, that is our promise to the community, but the biggest changes are on the Premium membership and the price increase.

0:12:50.6 CR: And I don’t think we wanna sit here and pat ourselves on the back as a company, I mean price change is a price change, but you and I have talked just personally over the years about how frustrating it can be when a subscription for this product goes up or this other channel that we watch goes up or whatever, and you’re never given a choice or… I’ve not personally had any experience where somebody said, or a business said, “Hey, thanks for being a customer for so for such a long time, we’re gonna keep the price the way that it is.” And so that’s a really positive aspect of this thing.

0:13:26.1 BR: You know I agree, and we certainly don’t need to pat ourselves on the back for any of it, the reality is that in business, sometimes you have to make decisions like this. But to have the flexibility to do it in the way that we’re doing it feels like the best possible approach. You know, I think we’re really trying to be generous, and even as you said, as long as your Premium membership does not lapse, you are unaffected by this price change, but also even going so far as to say, “Hey, we’ve got a 30-day grace period.” So that means like if you’re… If need to deal with something with your bank account, if you forget to renew it and you’re not on an auto-renew or something like that, we really wanna make it easy for you to continue being a Premium member. We appreciate the support. It means a lot to us.

0:14:14.0 BR: And to be fair, it would be nice to have geocaching be completely free, but that would require a lot of other things being completely free that simply aren’t, and it’s just not the way that the economy works and that business works. And so hopefully the next wave of people coming to the game feel like 40 is a really reasonable amount to pay for the hobby or whatever your prices in your country, it should be slightly above or slightly below that, based on conversions. Hopefully people feel like we’re continuing to deliver value and the reality of it is, there’s 95 people at HQ and Seattle that are working very hard to deliver this game, build community globally and provide a lot of joy for the world, and we can keep doing that together with the 400-plus community volunteers and everybody else, then that’s something that’s really good for the world, and I think it’s an honor for us to be a part of it.

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0:15:19.9 CR: That was Bryan Roth, Geocaching HQ’s President and co-founder. For more details about the price change, please visit the geocaching blog where you will find the original announcement and a page of frequently asked questions. Thanks again for downloading our podcast, if you have an idea for us to cover here, send an email to podcast@geocaching.com, that is always appreciated. And for me and Brian, and all the lackeys at Geocaching HQ, happy caching.