I’ve been selling products for 5 years now, starting with premium WordPress themes.
I now have a plugin business and a SaaS product. I’ve learned a lot, this post is basically everything that worked and didn’t work for my theme business, and where I see the theme market today.
A brief history of premium themes
Matt Mullenweg forked b2 to create the first version of WordPress in 2003. Around 2007-08 the first premium theme companies started popping up. (There’s a nice history of premium themes here.)
One of the first was Studiopress, founded by Brian Gardner. Studiopress quickly escalated into six figures per month, and other theme businesses such as Press75 found fast success as well, and the theme gold rush started.
Lots more players jumped into the market over the next several years, and that trend has continued. Some market leaders emerged (Woothemes, StudioPress, Elegant Themes), and new distribution has changed the game (Themeforest).
Fast forward to today. The market is incredibly saturated, prices have dropped, and theme quality/bloat has become an issue.
It’s not impossible to compete, but very few companies are able to break into the market and make any real money. Even if they do, it can be tenuous. Theme buying is subjective, so it’s difficult to become a mainstay even with early success.
I co-founded a theme company in 2010 and saw a little bit of success. We launched our first theme as a niche fitness theme, and it sold well through affiliates. Later we had a fairly successful upsell theme that got over 120K downloads on wordpress.org. We also got a theme on wordpress.com, which did ok at first.
We worked pretty hard and the most we ever made was about $18k/mo. A lot of companies are doing a lot better than that today, Themeisle has gotten to an impressive $60k/mo based on upsell themes, with a single theme bringing in 50% of that.
That’s not easy though, here are the main issues I see.
1 theme per site
You can only have 1 theme per site, and most people already have one.
Compare that to a forms plugin, that could be put on any site. Someone may buy 1 theme every year or two, but 5-10 plugins. You can get more repeat sales, and your market is bigger.
Theme buying is subjective
Customers buy themes based on the way they look, and how many bells and whistles they have. That makes it difficult for a good developer to make a beautifully coded theme and compete.
I saw this in my own business, but for proof all you have to do is look at the #1 selling WordPress theme of all time, Avada. This single theme has done over $7.8MM in revenue, that’s a staggering amount of money.
Avada has a visual page builder, a megamenu, a shortcode generator, 4 different sliders, parallax scrolling, 60 psds, unlimited sidebars, CSS animations, and a load of other crap, all for $58. That’s what people want in a theme, the sales numbers speak for themselves.
Themeforest has set the new low pricing standard
I have mixed feelings about Themeforest, but it doesn’t really matter. What matters is that they have established themselves as the largest distributor of premium WordPress themes, and they have low prices. The new customer expectation is that themes should cost $50-$60 like they do on Themeforest.
With prices that low, you’d have to sell 200 themes per month just to make around $10,000. Selling 200 themes in a month is not easy, and that doesn’t take into account any commissions or expenses you have. You can’t build a business with those numbers.
You constantly need new products
Themes have a very short shelf-life. You see really good sales when your first release them, and then they drop off. Eventually you find a few themes that continue to sell really well, but to have a successful theme business you need to create a lot of themes.
That means you have to support and maintain a lot of old code, and that adds up really quick.
Distribution is tough
Whether you sell on your own site or on a marketplace, you have to get a lot of eyeballs on your themes.
WordPress.org
Selling upsell themes through wordpress.org can get you great distribution quickly. However, certain things like the name of the theme, features, and the niche you are going after can be the difference between success and failure.
I released a couple of themes on .org, and a theme that I felt was superior got 1/10th of the amount of downloads as my previous theme. You will probably have to release several themes before you get a solid source of income from upsell themes on .org.
Relying on any 3rd party for your sales is always risky. The .org theme review team recently decided they would force theme authors to remove non-display functionality out of their themes, which will pull the rug out from under many upsell theme authors. This is the risk you run when you are not in control of your distribution.
WordPress.com
WordPress.com is very selective, and you only get 50% of revenue. When we were invited to add our theme to their site, we had to spend weeks rewriting our code to meet their standards. Some of it is little stuff like adding spaces around parenthesis.
The theme didn’t sell nearly as well as I hoped, we only had a little over $6,000 in sales after 9 months (that’s net revenue, after they take out 50% + fees). Now we only see a few hundred a month from that theme.
Themeforest
I don’t know much about Themeforest, but a friend who is an excellent developer had a really difficult time getting a theme accepted. If you look at the top selling themes there, it seems you have to make the world’s most bloated theme if you want to get any sales. Here’s an article by Justin Tadlock on his experience with Themeforest.
Your own site
Selling on your own site can work great, but you have to work hard to get traffic. Affiliates can help a lot, as long as you find good partners who send you high quality traffic. Coupon sites can only get you so far.
Wherever you sell, releasing new themes always results in a boost in revenue. Most marketplaces give you a bump when you release because you are listed under the “Newest” category, and new things just get more attention in general.
It’s not impossible
I’m not saying you are dumb for starting a theme business, or that it can’t be successful. Just run the numbers and see if spending your time making themes is better than spending it elsewhere.
Let’s look at some of the advantages of other types of products.
Non-Theme Products
A non-theme product can be anything from a plugin like Easy Digital Downloads, to a SaaS like Kissmetrics.
These automatically have a wider market because you can have more than one product per site. They allow for more creative business models like paid extensions or recurring monthly fees. A product is not cast into a set pricing model like a theme, because customer expectations are different.
There’s no question that non-theme products are a superior business model. Take for example Woothemes, one of the early theme market leaders. They had a $1MM+ theme business, then released a plugin based product called WooCommerce that became over 80% of their revenue. They since grew into one of very few $10MM+ WordPress product companies, and were recently acquired by Automattic.
Plugins are not a gold rush
Selling premium themes became a gold rush because the early sellers made so much money so quickly, and everyone wanted to imitate their success.
At that time, it was very difficult to make money from plugins, because everyone expected them to be free. Today, the plugin market is thriving, and some say it’s a gold rush all over again.
Themes were a gold rush because the barrier to entry was so low. You didn’t have to think about making a new, useful product that solved a problem, you just made a different design.
Plugins require solving a problem, which is what any good product does. A product that solves a problem and provides value will never go out of style.
Once you start thinking about solving problems, and not just about themes/plugins, you can also start thinking bigger.
Thinking beyond WordPress
At 24% of all websites, WordPress is big. There’s no question that it is a great market, but there’s still another 76% out there.
If you want to open up an even bigger market, think beyond WordPress. SaaS products work for any site, which gives you a lot more options.
OptinMonster recently switched their product from a WordPress plugin to a SaaS app. I don’t know their revenue numbers, but I’d be willing to bet they quadrupled their revenue potential. Their product went from working with 24% of the internet, to 100% of the internet. It’s a great move.
Another example is a company like Sucuri. They started with WordPress, but now it’s only 30% of their business. And their business is big.
Keep in mind SaaS is not free money, it comes with lots of unique challenges. My experience with Reactor has been that SaaS is a more difficult business model in the short-term, but the revenue potential is higher long-term.
Food for thought
I’m not saying you shouldn’t start a theme business, or you should jump into SaaS. You need to do what’s right for your product, and where you are on your journey. I hope you can learn something from this post that will help you succeed in whatever you are doing.
What is your experience selling WordPress products? Let me know in the comments.
Comments
26 responses to “The WordPress Theme Business, Then and Now”
Over the years I’ve been creating WP themes, I’ve seen a lot of things come and go…in some cases, even the absurd. The theme business is definitely a lot tougher to get into now if one is new to it and will bring a lot of challenges as you pointed out.
It’s true that people decide to buy based on how a theme looks, followed by the list of features (even if they don’t need 90% of them). Theme Forest is a good example showing the high selling themes have amazing demos, even multiple demos for the same theme, along with the massive list of features.
Finding the right source to market your themes is very tough, I agree. Depending on wordpress.org is not a place to hope for lots of traffic and up-sells as it once was. They’ve changed things there, especially the commercial listing link which is hard to find at first; easily missed. It was mentioned in a WPTavern article that since the redesign of the theme repository, traffic via the commercial listings is way down.
As for looking to Theme Forest, I think the time to enter that realm is long gone. The perfect timing for that was in the beginning years, up to maybe 2 years ago. Getting approved there when you’re not a “Elite” theme author is nothing short of a miracle. The review process is somewhat controversial, and I’ve seen good themes rejected with form letters in less than 10 minutes after submission. I estimate an acceptance rate around 1 in 10 chances. They cannot approve too many themes each day and I know they get a ton of submissions every day, so they perform a quick subjective elimination process (or it appears to be like that). It’s still an enigma as to why certain themes do insane sales while other amazing themes don’t. Regarding Avada, crazy, seriously crazy! They generated $7.8 million in less than 3 years! If you decide to go into Theme Forest, don’t expect to become an Elite author any time soon…for most, that time is past. Most themes now are averaging less than 80 sales. When you consider it takes about 3 months to do a theme for Theme Forest release, well….do the math.
Now that I’ve started another theme site, I’m going to push for Google organic search for traffic, and do some other creative concepts to gain exposure. WP .org is still on my list, but I don’t expect it to be my primary source of traffic and up-sells.
Good point 🙂
You sound as though theme business is almost dead.
Not dead, just a lot tougher for new companies to make money.
At ThemeForest, we have a really high visual design standard. When items are rejected quickly, it’s because they fall short on that front. I’ve been with Envato for about a year now and I remember when I started that I was a little shocked how high it actually was.
If a theme is close to the bar on the design, the author will get a rejection highlighting some things to address before resubmitting. If it’s not so close to the bar, the author will just get a snippet advising them that the theme has been rejected (which I know is not a great experience for the author).
Once the theme has passed the visual design review, it moves on to technical review (Theme-Check plugin, check whether it meets the rest of the submission requirements, manual code check, etc). If a theme is rejected at this stage, the author will be given information about what needs to be fixed before resubmitting (eg, need to enqueue scripts properly, escape output, etc).
I’m not actually sure what the acceptance rate is, but there is no quota or cap on how many we can approve. If every theme meets the requirements, we accept them all! But in practice it turns out many are short on the design front (and some of these are very well designed, just short of the really high bar).
Thanks for the comment Stephen, good to know what goes on internally at ThemeForest.
I like the story about how X Theme was rejected multiple times before putting $1,000,000 in Envato’s pocket.
That was a close one. 😉
Another approach to the theme business is to setup a subscription to all your themes. Elegant Themes has done seems to have done a really good job with this. Of course, that means you need a lot of themes and you probably need to keep building your library of themes – but it does give you recurring revenue which seems good.
Good point Lee, subscriptions are hard to do in the plugin and theme business, but some are doing it well. We all could benefit from a model that works well for customers and authors alike.
this was nice history of theme bussines
Great piece Scott! It definitely feels like the WordPress ecosystem matured to accept more paid products like plugins and services. Regarding a “plugins gold rush”, there are definitely way more businesses built on top of plugins that what was out there 2-3 years ago. Having said that, if you look at the plugins market, only a small fraction (< 1%) is actually being monetized today. While with themes, it feels like there's a company / business almost behind every theme (correct me if I'm wrong).
Hey Vova, I would agree with that. I think a lot of devs make plugins to solve a problem for a client or a personal project, with no intention to monetize. That happens less often with themes, since you wouldn’t put a client’s theme on the repo.
Way more people could monetize plugins for sure, and I’m sure Freemius could help 😉
Hey, what’s Freemius?
Now I’m all curious. 🙂
Freemius is a monetization platform for WordPress plugin developers. I don’t want to hijack this comments thread, but you can read more about it here:
https://freemius.com/wordpress/
Thanks, it sounds like a real time saver.
“Manage One Plugin Only”
Nice.
Good luck with it!
Well said Scott! We have built 10+ themes which ended up selling <$1000/month and when we decided to stop focusing on themes we got a bit lucky with Zerif Lite, so unless you have a strong distribution channel/marketing skills or you fell really lucky, don't expect too much from a theme business.
Hi Ionut, thanks for the comment. Why do you think Zerif Lite is so popular?
It’s free, has a lot of option, and it’s easy to customize it without putting a lot of work on this.
@Ionut, why did you quit theme developing? One successful theme out of ten is not bad score. 😉
nice article
Whatever you decide to do, one thing is certain:
It’s better to be in a competitive market that is growing, than a less competitive market that’s shrinking.
Sure, the latter can work, but upside is obviously pretty limited.
Tip #2 – Pick a niche. Better to establish a small beachhead and grow out from there, than to have no beachhead (i.e., no foundation – small or otherwise – to grow on.)
I’ve been wondering about your experience since I saw you move on from PressCoders to AppPresser. When I ran ThemeSorter, your fitness theme was one of the better earners for me. My assumption was that it was because it was a niche theme. Was it your best selling theme overall?
My feeling is that focusing only on selling themes in a one very specific niche is where it’s at. Shelf life, pricing and competition seem to be less of an issue when you have something people are specifically looking for and that themes like Avada don’t offer. I wouldn’t attempt to sell multipurpose, blog or portfolio themes today. Hotels, restaurants and churches might not be the easiest to get into at this point but I think there are dozens of other untapped niches.
I say either go berserk and crush everybody with an Avada-like theme (extremely difficult) or make themes for child care providers… they’re in every neighborhood and their websites stink.
Hey Steven, yes FitPro sold really well, and focusing on a niche like that is a great idea if you want to sell themes. The key is to sell it as a solution to a specific audience, not as just another theme.
Absolutely, niche is the way to go. I’m building a WordPress theme for rating and reviewing local health services. There are approximately 150 Healthwatch charities in the UK that do this, so I have a small pool of potential users but many of them are likely to want what I’m offering if it’s good enough and meets their specific needs.
The trick is to provide services (training, content population, customisation etc, maintenance and support) so it’s a whole package.
Best of luck Jason!
Thanks Scott. I’ve noticed similar trends myself when browsing Envato’s forum. Other than a few that make it, the rest end up churning up new themes to get more sales. And mind you, it’s a low 62.5% margin they are getting due to low sales.
So most theme authors end up creating new themes –> submitting them –> See about 100-200 sales before drying up –> submit another theme.
In the end of the day, they end up with 20-30 themes to support. Wouldn’t it be better to just start with a blog like how StudioPress/Copyblogger did?
I’m reading this a few years on and it is still valuable thank you for sharing all these insights 🙂
Definitely gave me food for thought.