Pricing Strategies

Summary

In this section I’d like to talk to you about pricing strategies, and show you the kind of versatility we have as online marketers with our own products. Many seem to just throw on a price similar to what they think their product is worth, or look at others and try to beat the competition.

Because our products and the way they’re presented is so wide and varied, there’s more to pricing your product than meets the eye.

A lot of people ask me why I go into so much detail when talking about prices among other subjects. They say get on with it, I just want to make some cash quickly. Well my answer to this is, if It’s all well and good if someone tells you how something works, but if the situation changes (which it often does in business, and fast) you need to know the intricacies of why something worked in the first place, allowing you to adapt your methods to the changing situations without having to buy a guide every time new trends appear.

So, how do we decide upon our pricing? Does competition matter and what should I take into consideration when pricing my product? Should I be cheaper? Should I be more expensive? How do I know when to be which and why? Should I give special offers to particular groups of people? Who? Why? Should I offer different versions of my product at different prices? How do I do that, and how do I know if I’m doing right? A shed load of questions and answers we’ll be covering in this section.

So here’s my top rules for successful pricing of any product that you create, and the questions that you should be asking yourself as you go through this process, as always from the ground up.

Rule one: Don’t price yourself too low. A low price doesn’t mean more profit. When you’re looking at pricing, the first thing that would probably jump into your mind if I sent you off right now to price up your products is what is the competition charging? I’m going to charge less.

Keep in mind from the start, your price doesn’t have to match or beat everyone else’s, or even come close to doing so for your products to be a success.

You do need to be aware of what others are charging for similar products, but that doesn’t mean you need to beat them. Why can’t your product be the Mercedes or the Aston Martin of your chosen market? It’s still a car, but it’s the best, a premium product and the price reflects that.

So, rule number one: If you have a great premium product, don’t be afraid to bump the price up. By putting your price up and above the competition, you’re actually likely to outsell super cheap competition. Why? Simple. Would you expect the same quality from a $10 course as from a $1000 one? So there we have rule number two. Never price yourself so low that you think people will look and think, “Wow, that’s a quality sounding product, look how little it costs!” Because that’s not what they’re saying at all. They’re saying, “Wow, look at how little that costs. What’s the catch?”

In effect, all you’re doing here is adding even more value to your product through a higher price. It might be the same product, but I’ll tell you now, it’s much more likely to sell at a price someone will think is reasonable, than something that knocks the reader off their chair at how cheap it is.

Don’t join the crowds who are too afraid to even attempt to bump their prices up. Don’t undervalue yourself for the sake of being cheaper. If you have a better product, you go ahead and put a higher price on it. People will soon hear about how you’re worth every penny.

I could show you so many products that are out there right now, in competition with each other, but one is charging a heck of a lot more than the other. How about this guide as one? Here we are charging you a thousand dollars for the full set of manuals, but there are plenty of other guides out there that cost ten dollars. Will the quality of both of them be the same? Looking at the price alone, from a customer’s point of view, I highly doubt it.

How about the latest purchase you made for your house, whether it was a whole work surface, a toaster, a dinner table, whatever it was. If you think back, some time ago things were the opposite. People wanted things that were well priced, cheap, and they worked. They were practical and affordable. Times have changed.

Nowadays, it’s got to be the fastest, the best, the most powerful, the nicest, the easiest and least hassle to use. Now is the best time to capitalize on this. Don’t put your products in the bargain bin if they’re premium products. More on this later.

Next up, offer choices for your customers. A Pro and a Lite version for example. Not everyone can afford a premium product, and a lite version is just the ticket.

On top of this, taking the above reason, not everyone can afford premium products, so offer up a choice. Selling premium products is all well and good, but when the price starts to get a little higher, you need to cater to those who can’t buy in one go as they may do with less expensive products.

Next up, reward schemes. It’s not hard to come up with ways to reward them. Right now, I’m putting together an ID number system for myself that allows previous customers to come along and buy my stuff at a discounted rate.

These people are the most important of all. You’ve already got them on your lists, they’ve already bought your stuff, which means they’re willing to spend money, and of course they trust you, and they’re serious about wanting more information, or the products and services you offer. Remember this, because if you forget you’ll go broke. It’s as simple as that. You want to keep the customers that are buying from you happy, and you want to stay in touch with them. If you don’t go out of your way to please them, you’ll have to go out and spend wads more on getting new customers. Look after them, because they’ll be with you for a long time to come and will form the base of a successful business from the word go.

Rule six: Avoid free trials. Trial periods are often a standard feature for a membership site, but unless you want to waste your time and resources on freebie seekers, set up a limited, less expensive trial for them. A dollar for the first month for example, otherwise you might find yourself wondering why your customers aren’t buying anything more from you. It’s likely because they didn’t want to buy in the first place, a waste of your time.

I’ve got a great example for you here too. Now a good friend of mine set up a site when we were in our early days on the scene. He had a pretty good product backed up by a multi level affiliate system, or a matrix of sorts. Anyway, he started promoting and all was going well, until word started spreading around some of his affiliates about some guaranteed signups site that sold signups to anything free, for a fee.

Now, unfortunately, I’m sure you can see what’s coming. Not only did the affiliates go for this one, which wasn’t much help to them, because of course most of these untargeted people were just freebie seekers signing up because they were getting something in return from the guaranteed signups sites, and only a tiny percentage were actually going for his hosting package or the pay plan he had in place. What he ended up with was a system clogged full of people that had no idea what they were subscribing to, weren’t making him or themselves or the people that referred them any money, and had no interest in doing so. A real resource disaster, that one. Make sure you do this one right and offer a trial for a small fee if your product permits. You could be looking at a similar costly situation otherwise.

Rule number seven. Never say your product is cheap. It’s cost effective, a good deal, but never cheap, which suggests a lack of quality.

Rule eight. Don’t be afraid to experiment with pricing strategies. I can understand how you might be worried that customers that bought your product costing four hundred dollars would be annoyed that they receive an e-mail for a special seasonal offer cutting that cost in half, but it seriously doesn’t work that way. You’re not offending anyone by doing this, and it’s the only way you’ll come up with new techniques and tactics yourself, through testing.

The fact is, real world businesses do this all the time. They have super sales, put prices up at Christmas time and particular times of the year when their products are going to be more in demand, discount things daily, add and remove discounts and so on. It’s not a wrong thing to do, it’s not unethical, it’s business. And if your customers have ever left their houses to go and purchase something from a store, they’ll know this.

So, here’s the deal. If you need some extra cash, why not offer a limited number of members a long subscription at a discount of a month or so throughout the year? I have to say this one works real well, and I had a large percentage of my member base from my previous site hand me large up front wads of cash that I could put to good use making more cash. If I’d left them at their twenty dollar per month fee, I might have made an extra few hundred dollars, but at a slower pace.

Rule nine. We’ve got a whole section that talks about adding value later on, through bonuses, different approaches, promotions, and the like. But for now, remember when coming up with a price for your product, don’t let your product be the only product. Strange sentence indeed, but look at it this way, what kind of things are going to allow you to increase your price and actually persuade people to buy your stuff?

The quality of your product and sales system are the obvious, but how about bonuses? What about testimonials from known and trusted people in your field? It’s not just material things either. What about your reputation and how others perceive you? So here’s a final tidbit of advice for you. If you feel that your product isn’t worth the four hundred dollars you’re charging then increase its value through these methods. If you still don’t feel it’s worth it, then at this point, you know that you’re charging too much for it, and your tracking data will tell you that also.

Ok, I’ll be honest with you. If you want to succeed and get your price just right, without being ‘cheap’ you have to do a little work. A little research and a little brain work. It’s not all straight forward one two three. Understand that it’s not about being cheaper than anyone else, it’s about pricing your product correctly depending on competition, who you’re aiming your product at, its quality, and your ongoing tracking and testing.

By now, you should have a clear idea how much you want to charge, and how you’re going to go about it. If you have, great. Just remember, the price you put up there on launch day doesn’t have to be set in stone by any means. It’s there to be tinkered and played with by you until you feel it’s correct. Have a little confidence in your stuff. Next time you create that amazing info product, membership site, or piece of software, try to avoid selling it at rock bottom prices, because I assure you, it’s not gaining you sales, it’s losing you them.

Next post:  Overview of Added Value.  Until then see ya later…

 

 

 

 

 

 

 

 

Overview of Added Value

● To introduce concepts of adding value before and after the sale of your product, keeping your customers happy, and putting more money in your pocket.

To show you how to start looking around you, and to start seeing what other people are doing with their value adding, especially the successful.

To talk about testimonials and how to take them further to inspire solid confidence in yourself from the customers perspective.

To look closely at standard bonuses, and to avoid some of the pitfalls of other marketers not in know, who destroy their sales by trying to add value incorrectly.

To give you three real life examples of real marketers that have tried to add value, but done so incorrectly in one way or another, and to show you how to avoid devastating your sales by doing the same.

To show that rewarding loyalty goes a long way to increasing sales, and sometimes producing multiple sales from a single product, that means double the profit in your pocket.

To demonstrate how a simple technique will make sure that your customers remember you and your product for a long time to come, leading to further sales down the line, and nice bulge in your pocket.

 

 

 

Adding Value Explained


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