Forfeit the Race to Free!
Price training your list and your customers IS real. If people are used to getting everything from you for $10, there's going to be a price shock if you jump to $500.
So you're stuck working way too hard trying to land 10-dollar cheapskate customers.
You need to work your way up to at least 100 bucks per sale. Consider if you want to raise 700 bucks... you can either make 7 sales at $100, or 100 sales at $7. Which do you think is easier? Getting just seven sales.
If you give away all your good information for free, or you're afraid to sell anything... then your list gets used to that!
You're Stuck in the "Friend" Zone!
Not a Good Place to Be (Remember High School?)
On the other hand, if you consistently launch products at $97 or $497, then your list is used to that and it isn't a problem.
This is why Lance and I have never offered live training for under $247, and recently never under $497, and from now on very rarely under $997. Plus, when it comes time to put those people into membership sites, we don't offer a "pay it all at once" option. I want people to get used to paying a small amount every month.
Are you starting to understand why Visa and MasterCard killing free shipping offers, one dollar trials, and hidden continuity is a blessing in disguise for your business?
You shouldn't be racing to be cheaper than your competitors... you shouldn't be in a race to cut the price lower and lower. You should be rewarding your early buyers, bumping up the price and being more EXPENSIVE than your competitors... because you deliver more value than them.
So how the heck do you retrain your subscribers and ensure you never take part in that "race to free?"
Solution: The Seven Dollar Bump
From now on, if someone asks if they can get that product of yours at a discount, you can tell them: "The current price is the discount."
Take anything you are still selling at 7 dollars and tell your list, the forum you're on, whatever audience you have... that you're increasing the price to $17 in four days.
If you need to offer a special deal on a webinar or in a forum, then add a bonus or launch it at that forum, and raise the price later... but never cut the price.
How do you think I'm going to feel if I buy something from you at $197, and then six months later I see it "for sale" for 20 bucks? Can I get my $177 back?!
Here's what I did back in my WSO days, leaving everyone else scratching their heads wondering why their products weren't selling: after selling a set number of copies, I closed the offer and re-opened it at a higher price.
Lance did this with our Niche Invasion System product. Launched our 1 hour webinar at $7, after a few days bumped to $17, and now it's at $27 about to go even higher. Every time, it converts better at the higher price point. Every time.
And Now, My Favorite Statistic Ever...
Check this out. Announcing that my "Five Minute Copywriting" product was increasing from $19.95 to $27 in a few days, doubled the conversion rate from 5.3% on November 19th to 10.4% on November 23rd. To this day it still converts at 8.2% ... imagine that, a higher price AND a higher conversion rate!
Visitor value is your conversion rate times the price. "Five Minute Copywriting" was worth ($19.95 times 5.3%) = $1.06 per visitor, then jumped to ($19.95 times 10.4%) $2.07 per visitor and is now ($27 times 8.2%) $2.21 per visitor.
Bump the Price By $10 Every Time,
and Watch the Conversion Rate!
I use Google Website Optimizer so I can measure my conversion rate AND split test at the same time. When a split test finishes, I increase the price by 10 bucks.
If at some point the price resistance is too high, like at $47 or $97, then I'll tack on an extra bonus to justify the price.
What a crazy idea... instead of discounting your offers, how about try some good old-fashioned marketing?
Increase the price instead of dropping it. Close down your offer after a certain number of seats are sold instead of opening up MORE slots. Upsell instead of downselling.
Your time is worth way too much to be selling 6 DVDs for 30 bucks, a video training course for 7 bucks, or even $50 access to a site with 100 products in it. Take part in the race to charge more than everyone else.
Question: What's your highest priced product? What are you doing to justify that high price? Please answer in a comment below... go ahead, leave a comment right now...
Filed in: List Building • Price Training • Product Launches
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Rahul, you will make more money than your competitors because you’ll be the one guy without a dollar trial.
And because of all the mastercard stuff that’s coming down, most payment processors really don’t like it when you have a $1 trial.
Plus, I see so many people doing the dollar trial wrong. They supposedly “split test” without taking account trial cancellations. The offer ALL the downloads for a dollar, then wonder why everyone cancels before paying the full payment. I would avoid any kind of trial completely… I have and I’m doing just fine.
This reaffirms my idea to go with a decent price and then raise later for an upcoming membership site of mine. Great content Robert. Keep it up!
Sing it brother…
When I got started online I bought a product for $1997 from one of the “GURUS”… My bad… it’s free now.. wtf??
Think I will ever buy there again… not a chance.
And you can bet I’ll never do that to my customers.
Having a product for even $27 or $47 is basically a joke. If you have a good product with good information then you should not be afraid to charge a reasonable price.
When I compare a $14,000 automobile and a $30,000 automobile I am going to do whatever I can to get the higher priced one.
Why? Better quality right?
Right…
I do the same with my education online.
Why would I try to learn from a $7 product from someone I know nothing about when I can pay $197 from someone who actually knows what they are talking about…
LT
Phenomenal Post Robert!
I’m releasing a product next week… I will raise the price based on this post!
Robert, this is really a great lesson. Thank you. LT, I agree with you. I had the same experience spending a lot of money on something that was offered half a price later on.
This post gives me a totally new way of selling my services. Pile the bonuses to justify the price.
Robert, can you tell me what is the difference between piling up the features in a sale instead of the bonuses?
I could not agree with your line of thinking any more so if my own Mother had said it.
My partner and I are opening our new membership site to a limited group of 500 people for $27 per month. We are going to shut down at 500 for a week to get some additional input and then reopen for a higher price.
Since this is a 3 month fixed term site we will be opening higher levels after the member completes the first section. Each new level will have more perswonal involvement from us and will of course have a higher price tag.
I believe I got this idea from you some time back. If not I have been giving you credit for it.
Thanks,
Clyde
As always, Robert, you hit the nail spot on. Your principles are so very TRUE. Yet sometimes we are cowards and end up selling ourselves short.
When people see that you maintain that price formula they will know they have to get in early, and thus this price principle alone can bring in much bigger sales.
Thanks for sharing this with us. Keep up the good work.
Thanks Robert,
I still in this price dilemma. After reading your way about pricing, i get the idea to follow it.
MD, what’s the next step then? What’s your next product launch?
Yes Robert, I think that you have a great idea, and I agree that you should increase your pricing as you become more popular. The down side to that is I think, that you will eventually push people away because they can’t afford to pay the higher prices.
I am finding that no matter what the seller says, there is a point that I don’t care and am not willing to pay the price or even read what they have to say.
IE: your pool of customers gets smaller.
I hear you now, saying that it doesn’t matter as there will be other people to replace the ones that drop out. Sure you are right, but there will be some like me that will never be able to even look at your products because they just cost too much.
Point in fact, there is some sellers on the internet that when I see their name I just click away as I don’t want to see what I am missing or not missing out on, as they just cost too much..
Wow, well we are launching our first product, an ebook this week – I am definitely putting the price up.
Thanks for the ‘nudge’
Big blooming hugs
Sherry
Thomas,
Have you tried raising your prices? Do you have anything for sale?
Your job isn’t to get to 100% conversion… not to make friends… it’s not to get even the highest conversions possible… just the most money. So if I double the price and the conversion rate drops by 49% … then I’m still making more money.
There’s supposed to be price resistance.
Robert, I have been dwelling on this very topic for some time now.
Do your WSOs really sell better by increasing the price?
I’m not doubting your claim at all…I am just curious to the reason WHY this happens?
Is there more people out there willing to spend more money in the IM niche than willing to spend less money?
Why would a person willing to spend $100 not buy a product at $27?
Is it because in their mind they deem any lower priced item as lower in quality?
Thanks for posting this by the way. I am seriously re-examining my pricing points and your post came at the perfect moment!
I am always impressed with what you have to say Robert, and you never hold any punches back. The tactics as well are always right on, and work well.
I would advise anyone to follow you and what you are teaching.
Dan,
Higher price = higher perceived value.
Also, in things like live webinar training, more personal attention. With resale rights, it’s less competition.
Some people might go for a “similar solution” for $27 instead of $100, I don’t want those people as customers… neither do you.
I forget what I bought 5 Minute Copywriting for.
Doesn’t matter.
Didn’t even need to use it to get value.
Just seeing how you packaged it was worth every penny and then some.
(And it is good, I did go through it later)
Robert,
FANTASTIC IDEA!
I am going to go in tonight and raise the price of one of my offerings based off of what you just taught AND send an email out telling the people on the list that the price is going up on Monday and they should take advantage of the ‘discount’ before then.
THANKS!
Ron,
From what old price to what new price?
Great post Robert. Thx.
I’m launching this week with a video training series wher new content is out every two days until 24 video’s have been delivered. This seems more like a 1 time payment to me than trying to do payments every two weeks or something.
I saw a product somewhere that had weekly billing…any thoughts on which way to price this will pull better?
CK
Hey Robert,
What a great post, and it is very timely for me because I’ve closed my offers on my services and are reviewing the prices and my offerings to make it:
1. Worth my while doing the work
2. Help me stand out from the competitors who charge too cheap.
I no longer compete based on price alone because this is a mugs game and everybody loses in the end. Including the customer because the person providing the service is not going to spend the time required to make their result exceptional.
I’m also looking at what I can offer to help build a list of customers interested in my services. I tried a free 60 minute recording that I did,, but I am reviewing this because it did not convert very well.
This way my business will be more profitable and then I can afford to pay for your trainings when they become available. (I missed the plr copyrighting which I was most disappointed about)
Regards
Bernie
My current highest priced product is 37$ and I use some very unique webinar recordings and audio interviews to justify the price.
It’s a major benefit (create 1 product in 1 day) so I think that info is priceless really. I just raised the price from my WSO of 17$ where I sold $425 in Dec.
You’re totally right about raising the price…it forces people to act right now.
Cheers,
Brad Spencer
My highest priced product is a membership site. I launched it back in November at $39/month, then launched it in December at $49/month, then I built my list a bit and launched it again last week for $99/month. No looking back. I added a “free” bonus to the latest launch, a 3-hour training video that I will now start selling individually as well.
Thanks for all your wisdom, Robert.
As well as doing my own marketing I handle the support for Jon Leger.
I got a support ticket the other day complaining about Jon’s latest product.
The guy sending in the support ticket complained that he hadn’t bought the product, even though it looked good. He felt cheated out of the opportunity of having the product.
Reason he didn’t buy?
He thought the price was too low for something that looked that good so ‘there must be something wrong with it’.
Cheaper is, most definitely, not always better!
Amin
Great post Mr. Plank. Next time replace your reference to Google Website Optimizer with a link to your very own
Optimizer, (you are creating one aren’t you?) and I will call you Robert. 🙂 I’m even checking both of your checkboxes below just to be nice!
George
I like your posts and language you use. I am ready to buy a product and spend 2-3K, but I need something that will work 100%. Do you have any course how to stop procrastination and start working? I am very good at PPC (managing 300K a month account on Google), but I am afraid to be on my own. Does anyone else has the same problem as I do?
Hey Robert
Looks like I have to raise the price to all my products…
My most expensive product is $47 (but soon it will be $97)
thanks for the great advice!
You’re welcome jbode… what’s your deadline on that $97 bump?
I’ve seen you apply this process repeatedly over the past year and it’s working so well, it’s a true model for everyone else. Thank you!
I suspect the reason more people don’t charge what their product is truly worth is a mental hangup – not feeling they deserve more, not having the confidence their product is “good enough” to command a higher price, falling prey to the “low cost” crowd that says your should be charging very little so that more people can take advantage of your information. I think you’re going against that grain and I’m really pleased to see it.
Lead on!
Hey Robert,
Just goes to show you what good timing with the proper pricing will do.
Fence sitters and freebie-to-low-price seekers will always be around. When enough people see the inherent value in what you offer, they will be pleased to grab something at the lower price you offer. Otherwise, pay more, but you still get top value.
Great tactics and information!
Thanks.
Best,
Paul Klein
Excellent. I’ll be doing a price bump after my valentine’s day promotion. (Who says you can use Valentine’s day to sell more guitar lessons?? =)
Hey guys,
Thanks for the replies so far. You’ve told me…
Clyde = $27/month
Brad = $37
Joe = $39/month
Jeff = $47
I’m actually going to be raising the price for my product in the next week or so. And I’m going to tell my list the price will go up a few days in advance. It’s funny that you’re writing about this right when I’m about to do it.
Thanks Robert
I will just follow along with what you do.
Its not hard, you do all the testing.
Time to train my list.
Great points, however I do have one question:
I remember you mentioning doing $7 (low-cost) reports to get people (buyers) on your list. You said that low cost buyer are better than “free subscribers”.
Where does that fit into this equation?
One of the reasons I ask is because in the IM world, price does NOT equate to quality. I think we’ve all bought one too many $97 rehashed PLR crap packages.
This makes some people ‘skeptical’ about spending over $20 with someone they don’t know.
Anyway, right now I’m in a “soft offer” niche and wondering how to price the products to “introduce” my products to newcomers to get them in the fold.
Antonio,
For a lot of people, there is no difference between $7 and $20.
Last July I was in Chicago meeting one of Lance and my customer’s and she said, “Your training was 200 bucks, that’s nothing, why wouldn’t I buy it?”
If your list is small right now… sure, chicken out at $7… but after that, build a bigger list.
Looks like I am low man here. Hope that is not a reflection on what we think the info is worth. We just need some more outside input before rasing the price. Heck if the input is good enough we may jump it up to $97 per month.
The problem we ran into was the people who got in said it was great and stayed. We just seem to be having a problem getting the through the door. Maybe closing it for a week and then giving them an opportunity for a higher discount price will get the fence sitters who missed out and then we can raise to the full price.
Thanks again for the great information and yes I know I missed out on the copywriting program. Can you spell PROCRASTANATION?
Clyde
I thought for a while that I was doing things backwards because my very first product was $397 and I then followed with 3 more training products at the same price. I keep thinking that I need to start coming out with a $7 product or a $17 product to get people into my “funnel”. But since the more expensive ones have sold so well why bother offering cheaper stuff. I’d rather deal with less people’s technical support issues anyhow.
You’re right Robert.
When I wrote my Website Owners guide, my thought was to put it into as many people’s hands as possible for a low price, so I priced it at $27, with a discount coupon which took it down to $12 and $17.
It’s aimed at small business owners, and most people didn’t even look at it. The feedback I got was that at that price, it must not be very good.
At $97, I don’t get that sort of comment any more 🙂
In this market, people are used to paying a few hundred dollars for a short report. It’s a totally different mindset to the freebie seeking, hard drive filling internet marketing crowd
cheers,
Eric G.
Eric: Heck yeah, right on, you proved my point!
Even when I was stock trading, I paid $50 to $100 for a single piece of paper… and it was worth it!
You are right on the money. We are all tought that giving away a product or a $7 product is really for list building use only. But you do have to consider the type of people that will be on your list. So I think even if you sell a $7 product & as long as you are providing real information of value… like you are, it may not be a huge issue. Tets, Test, Test…taht all we can do.
Timing is everything too!
Great insight!
Robert Montoya
Robert, you are right on the money too.
Funny thing about $7 products… this doesn’t happen all the time, but with one product (WPLeadGen). For weeks, the sales letter converted higher than the squeeze page — for a similar product. The squeeze page converted at 23% and the $7 sales letter at 32%.
Now that the stats have settled, it’s more like 20.3% for the $7 product and 37.14% for the free optin, but still… not that much of a difference for free vs paid. And then you saw my other examples in the original post, raising the price increased conversions more often than not… don’t assume charging instead of free, or higher prices mean less money. It usually means more.
Great post, Robert.
Yes, I agree that we should raise our price on products as time goes on. I just did that this month wih my 6-month training course for small business owners, where I doubled the price (just as I had promised the previous customers I would).
And making the conscious choice to charge more than less also works. I just opened the door again to my online QuickBooks training series and wasn’t sure if I should lower the price a bit because of the economy. But then I caught myself. There’s a little mantra I use whenever I feel that way: “When in doubt, always charge at least a little bit more than you’re comfortable with.” Works great, and once I do it, I realize I’m still hitting the sweet spot of giving fantastic value without sending the “cheap” message to my customers.
Excellent model. Now you’ve got me juiced to raise the prices on several of my other products! THANKS!
“When in doubt, always charge at least a little bit more than you’re comfortable with.”
Perfect! And then use that “not being comfortable” to your advantage… write better sales copy, write more autoresponder followups, contact more people for joint ventures.
To me, there’s no qualitative difference between $20 and about $35. In other words, I “feel” the same whether I pay $20 or $27 or $35. Assuming others feel the same way, why not charge $35?!
Mike, that’s a great way of thinking about it. Charge $35 instead of $20 if that’s how you feel then.
Robert, I so enjoy your blog posts. More than that, though, I learn from them. Keep up the good work – you are inspirational!
Robert, have you been talking with my hubby? He is always saying my products (and my time) is worth much more than I charge. I agree that I would rather sell 7 copies at $100 than 100 copies at $7.
It’s time to get what my products are worth and keep helping others with great products.
Thanks for the encouragement to put into action!
Theresa 😎
Theresa,
You’re welcome… so you are now going to charge $100 instead of $7?
Robert,
I’ve seen this concept out there before, and it sounds way too good to work. Its nice to see some real numbers for real products!
Just completing my first product that will help folks in the boonies, get real Internet with cellular broadband.
Being my first product, there is such a strong pull to offer it at some ridiculous low price. Mentors tend to point me to the ‘start high and lower later’ approach. I like this strategy because I can start the price a little higher than my comfort zone, and raise it a couple times after launch!
Its’ been great to see another, “programmer does good in the marketing” blog like yours!
Thank you kindly,
Marshall
It is funny Robert, I have watched your growth over the last two years. You really have jumped way above that $7 products fee. Good for you. I congratulate you. I hope everyone that reads this will understand that they can do it too. Just follow Robert and pay attention.
Congratulations.
Mike, glad you’ve been watching me. Have you been making progress these last few years as well?
You are exactly right.
When I buy a MRR or PLR I always set the price at least $7-$17 more than what the author is selling it.
I have found that it must be sold with a separate domain to get the highest price, if not the customer will go to the author’s site.
Thanks for putting this out.
Neil Adams
Hey everyone! Listen to Robert!
He’s absolutely right, even if it’s a gulp everytime at any price point. A few years ago my mentor said stop selling your hours, sell programs. I bit the bullet, told my next prospective customer I had 3 executive coaching programs… they took the TOP one, and bought a second program for another member of their team.
THEN they decided they’d prefer to get the 15% discount for paying the entire year up front for the both of them. I went from invoicing for a couple of hours a month, wondering how long my clients would keep working with me, to a hefty 5-figure check and a year long commitment.
The lesson – fewer clients, sure, AND fewer stresses over how much I’m bringing in!
In the words of Lance and Robert: “Add a didgit and see what happens” (OK – if they haven’t said it yet, they will any day now 😉
Hi Robert,
I ALWAYS enjoy your posts… Another great one!
My current highest price is $37. Other products ranging down to $7…
I will start sending out messages and updating my sales pages to let my customers and list-members know that the prices will all be going up (by 50% or $10 whichever is the greater)…
7 -> 17 ($10)
17 -> 27 ($10)
27 -> 41 (50%)
37 -> 56 (50%)
I will set a date for each increase and give about 1 week notice.
The higher ticket items will then go up again a couple of weeks later and have quality bonuses added to help people justify the price to themselves
Thanks again for your great inspiration
Trevor
Robert,
From $14 to $27, but now I am thinking $37
Robert:
you have a very good point!
When I work on product launches I always add insane value through bonuses and the way the offer is put together. I’ve never felt that it makes a big difference if you charge $500 or $2,000 when you do that (provided it’s a good product and you offer it to qualified prospects.)
Cheers,
Thomas
Good post Robert. I’m always encouraging my business owner clients to raise their prices in small increments, and to do it consistently. The cost of living goes up 8 – 12% a year so if they don’t raise their prices, they will eventually go broke.
The highest priced product I sell on my website is the Money Management Solutions software program for business owners at $997 – it’s a cash flow management tool.
I have higher priced products that I currently do not offer on my website because they were developed so my licensed software distributors have some exclusive products only they can offer, that regular affiliates don’t have access to. Those training modules sell for $2,700 to $4,700
Great article Robert. I love to see my products being sold for a price worth selling. I hate when people undercut the price point of the market..
People need to actually do themselves a favor and not by the cheaper not as good product..get the one that they will get the most out of..
Thanks!
Jesse Guthrie
Hi Robert,
Refreshing to hear you say this. The common trend seems to be lots of products (most of which are not good quality) for a low price. Much better to get your list accustomed to buying quality products from you that offer true value for money, and then start moving them up your sales funnel to more and more expensive products with the value for money constantly increasing as well.
Regards
Ken
I’m still paddling in the shallows and haven’t sold anything yet although this makes me think…
I have given away a couple of freebies in the past and didn’t get much of a conversion at all from my list. Maybe they thought free = not worth it.
So, next time I put something together I’ll put a $27 price on it and start increasing the price $10 at a time to test how elastic the price is.
Thanks for the logic. Love your work.
Mel
ps I DO feel annoyed when I miss a WSO and the price ramps up – wonder if my customers may feel the same???
Mel, it’s annoying sometimes, but I pay a higher price for a product all the time and I don’t think twice about it.
Which would be more worse: having to pay more because you waited, or having to pay more because you bought EARLY, and everyone who waited got the discount? It’s not perfect, it would be nice if everything was free, but it isn’t. 🙂
Hi Robert,
Great post as usual. I’m curious why are amounts with the number “7” on the end ($17, $27, $97 etc…) so popular among Internet marketers? Seems that everyone uses these amounts. I buy stuff from Amazon.com all the time and prices are not set at all. Why with people marketing in the IM niche these dollar amounts are used so often?
Kenneth,
Why NOT end with 7? It sounds and looks cool. Plus most of my mentors end their prices in 7. I used to price stuff at funky amounts, like 16.66 or even a flat 10 or 50. Have I split tested 7 versus 9.95 or 17 versus 19.95? Nope, probably never will, there are more important things to split test. I just like it.
Still have to get the sales page up but I am setting up a blogging tutorial membership site with a $7 free level with instant commission then a $97 upsell with a $47 downsell if they do not take the upsell the downsell has less information.
Robert
Hi Robert,
Your rants about your pet peeves are always spot on. I think the biggest challenge for us that are new to charging for our own products is trying to figure out a fair market value. It is still amazing to me that someone sees enough value in the information I can provide to pay me for it. Some of which is information I have shared over the years with friends for free.
I definitely get the “never lower the price” issue and why the increase in price is almost like scarcity. And how it is definitely better to raise the price as either you improve the product or it is a proven product.
Plus sometimes folks think if it is inexpensive it has less value.
Keep up the good work!
Dr. Debra
There are a number of good high priced programs/products out there.
But when you don’t have the resources, you don’t have the resources. Your right to not lower the price, unless something has happened to your quality, but you need to provide a way someone just starting to come on board.
There is an attitude out there that if you can’t afford my price I don’t want you as part of my program.
I am testing the free report against the $7.00 report. I think I give value in abundance and my reports are worth 7.00
So far my product price is at $27.00 next product will be $47.00 and gradually up.
What I have always admired about you is that you keep your word, and when the price goes up it goes up and when a course is closed it is closed.
Not raising your prices when you say you will kind of reminds me of those idle threats some parents use. Doesn’t do any good.
Sheila
Great Post Robert, I actually just did this 2 weeks ago.
I went from 20 per month to 200 on my SEO Services after a year of discounted prices. Same work for more money works for me. Tim
@Bob Marconi:
I know where you’re coming from, and I’ve recently catered for this by offering my guide in a series of free weekly installments.
I received many good subscribers that way, who will remain newsletter subscribers and hopefully remember me when they HAVE got money to spend.
cheers, Eric G.
Lance, I can see if you have a list and have been selling products to that list for awhile but what if you don’t have a list and/or you are staring out in a new market? I’m still a little confused on how you would create that trust factor to where you can sell the “high” end product.
Mike
Hi Robert,
The headline of your blog speaks for itself. You almost do give away too much valuable information for free (almost ironic vis-a-vis this post)!
Not only are your more recent posts spot on, but it is really interesting to learn how you have developed your business over the past few years by reading a lot of the older posts – still extremely valuable today.
Funny thing is, there is almost a complete IM course here for the taking, though many people that might stumble upon this page could overlook the gems because it is “free”…
Anyway, I just launched a video training product on traffic for $197.
See you on the other side!
Dan Kennedy proposes marketing to the newly affluent.
Why try to scrape a few bucks out of the guy who is just getting by on his pittance. Instead, raise the price point and sell to the people who can afford what your product is worth.
If your product isn’t worth that much increase the perceived value with bonuses, bells and whistles. Make it ritzy and hold nothing back. Include a physical copy, not just a digital download.
Add video, audio, transcripts, whatever is not already included in your product.
The guy who has a million dollar a year business isn’t going to be looking for a $17 info product that more likely than not will just waste his time.
He is going to want personal attention from someone who knows what he has to offer is valuable, and charges what it’s worth. He will gladly pay the price for what he sees will increase his _______ (bottom line, hobby enjoyment, productivity, free time, happiness, love life…)
Be the person who caters to high end customers and you will become one of those newly affluent. Wallow in the trenches with the wage slaves and you will become one of them.
Which do you prefer?
@Mike,
There are plenty of people that who only have high ticket products.
Michelle in post 36 says her very FIRST product was for $397.
You can build trust through social proof and YOUR proof.
Social Proof: Build a blog where people can get to know you and comment on you. Look at RobertPlank.com and the number of comments he gets. If you knew nothing about Robert and stumbled across this blog you would immediately assume he knows what he is talking about.
YOUR Proof: Be your own case study. Share your results. Be transparent. How many marketers online are as transparent as Super Robert? I’ll give you a guess it starts with ‘Z’.
The bottom line is don’t expect it to happen overnight. Do the right things. Stay realistic and always remember that your failures are as valuable as your successes.
Lance
Robert,
Thanks for this post I am working on my product and after watching a few videos in videosalestactics I decided to convert it into a video course so I can sell it for a higher price.
I will admit though video is still out of my comfort zone but I am working on it, its almost finished already and I believe I have an edge because I see most of my competitors are using plain old ebooks as the delivery format and only the top one is using video as sales letter (based on gravity at clickbank).
But I am still not sure about charging a higher price, because when I see most of my competitors offering a discount or a 1 dollar trial through an exit popup I can’t help but think these tactics work, because they have been doing this for a long time, and I am only a newcomer.
Do you think separating your products as a high ticket items can work in any niche?
Looking forward to your response
Rahul
That is so true Robert! My old professor used to say that “value is the place where value is added” i.e. whatever someone is prepared to pay. Nothing has a fixed inherent value.
You can always sell 10% of your $997 product for $97 if you want to. Most products lend themselves to segmentation quite easily.
What’s my highest value product? At the moment it’s a $97 video series. After reading your post and thinking hard about this, I’m going to use higher price points next time.
I’m thinking that I will try out the higher prices on my current lists, but I suspect that they are used to sub-$100 products and won’t leap at the higher prices in great numbers (but then I don’t need many of them to do that, right?)
The real new idea I have is to build a new list alongside my old ones, and target higher value customers. I should be able to attract a different kind of customer at a higher price point. I just have to repackage my products with higher value appeal!
Cheers,
Barney
Hey Robert,
How are ya doin’?
I’m at the early stage of launching my new product/membership site and have been going round and round in my head about the price to charge, thinking that because of the fact that I don’t have a list to sell to, I should make the initial price point cheap so as to entice them in and then do the usual OTO upsell to the more interactive, hands on type of coaching that could be involved.
What I get from your post and the comments above is this…
if it’s just the product with no interaction, but some differentiation (a resale rights product with some extra unique stuff I created with others) then I should charge $47 right off the bat (the product license sales material starts the retail price at $197 and recommends $147 – but good ol’ eBay sellers knock out digital copies for around $27 to $47)…
if it’s got any kind of interaction with me or my co-host coaches, involves blog interactions, challenges where I have to go check stuff and do more work, or it involves webinars (even if it’s just the one though I’ll probably do a minimum of two… it just seems to fit in with the six week course content) and any kind of group coaching calls etc then, if I’ve read correctly, I should charge at LEAST $197.
Am I correct in my interpretation here? Also would you advise that I sell this via Clickbank at 50:50 share or 25:75 (in favour of JV partners with lists since I don’t have a list of buyers)? I’d be interested to know your thoughts on this.
GCT
Gareth,
Yes… if there is any live interaction with you, then it’s at least $197.
Charge a minimum of 60% on Clickbank to stand out, since the average — and the default — is 50%.
Robert,
Regarding your insight about the race to the bottom, I made a little video for you.
Its about cheap beer, neon lights, branding and “fully krausened” assholes.
I see we think alike. you’ll dig this.
http://www.viddler.com/explore/Generosity/videos/10/
thanks and take care,
Bryan,
aka faceman
Hey Faceman, I watched the whole thing. Great video… we do think alike. When the beer is “fully krausened” I can no longer compare it to the other beers… I don’t know if 6 of them is “just as good” as Michelob, or 20 or 30… so I have to see it as it is.
Hi Lance,
Great post….
I was debating this very point on a membership site I’m setting up. I was going to give a lot of content away for free, but now there will be a lot less for free, and the price will be going from $47 a month to probably $67 charter membership and then $97 shortly afterwards.
It’s been a good nudge in the right direction – Revenue!
Thanks again, keep them comin’!
David
—
Hi Robert – I meant to put your name in the previous post. With you guys on the calls, it seems to be the Robert & Lance show the whole time, so separating you can be a challenge at times! 8)
David
—
HI Robert
My most expensive product my partner and I have is £297 ($450) for a muscle building system. The clients need to purchase about £500 ($750) worth of supplements for 12 weeks.
Having read your post I’m going to consider raising the price on it. One question I have is do you think it is worth offering a payment plan on the product.
We have the system laid out into 6 different phases so could easily split it up e.g. £100 for each phase with a discount if you buy it all at once.
Gavin
Hi Robert,
Another great post. I’m still scratching around in my sandbox, but I at least have a plan of action now.
My question is: if my site is mostly a blog sharing my various opinions on things, should I target my advertising for higher-priced products or go for the cheap stuff?
Ok, I know my concept isn’t that great but I have to start somewhere.
As an aside, I watched the video done by Bryan… interesting…
Richard 🙂
I definitely agree if the products are worth the price. I myself bought a product from a famous name online when I first started out which was over a $100 dollars. When I saw it I was totally dismayed.
Most, if not all, of the information I already had obtained free on the web and needless to say I asked for a refund. I wouldn’t buy from that person again so did that work I don’t know.
I will probably get slated for this comment but there definitely seems to be more interest in how much money one can make than actually helping someone put the product to use and actually get them using it.
These days I only buy from people who reply to me when I communicate to them and that I feel are genuine in wanting others to succeed and might even be interested in helping me.
Dave
Pricing of products is always a tricky proposition (mentally) and you broke it down in a convincing way as to which path to take.
I’ve been struggling with this issue with my first membership site, which is now set for a one time $7 entry fee. I will start increasing it to $10, then $17 and eventually clone it to a monthly recurring with more value.
Thanks for providing the rationale and psychology behind this tough problem.
Blessings and success,
MikeR
My highest price product is $47, and its an info product book with a business plan template and some bonuses in the quilting business market. I justify this price because a) there’s a lot of “stuff” with the product, and b) there’s not really a lot of alternatives out there.
The market is somewhat “cheap” but I should at least have a $97 product and I’m working at it. And you’re absolutely right… when I first started out, I raised my prices and my profits went up. Somewhere along the line, I lost my way and reduced some of my prices.
I’m going to reevaluate and start working on a new package of products.
Thanks!
Thanks for this post Robert.
You are so right. I am in a lot of niche markets and after extensive testing I have found I get a better CTR (response) with the higher price than with the lower prices 🙂
Great information Robert and I must admit, you nailed me as I need to get out of the “freebie” mode, get over the fear of selling to my list and get going!
Thanks for bringing me face to face with my issue.
Lots of educating material here…I’ll definitely be back!
Kathy
Robert I agree with you 100% even though I never buy anything from you because you are too expensive, you are right!!
Thanks
E. Smith
Hi Robert,
You are a breath of fresh air in a world of doom-sayers! I’m working on setting the prices right now for my new membership site. One of the thoughts that keeps coming up is that I want this to be affordable for people.
What I forget is that when people *really* want something, they will find a way to get it. I know I certainly do! So why do I think others are any different?
Your post today was JUST what I needed to hear. Now let me rework my numbers and see what I think the products I’ll be offering are really worth (what value I’m providing.) That is a whole different proposition. And honestly? I know it’s the correct one.
One more thing about this topic. When I start thinking about “what will they pay for it?” — I go into “lack/scarcity” thinking. When I think about what value I am offering, I get excited and enthusiastic. Now which energy is more attractive? Guess that’s a no-brainer, right?
I am very grateful for the way you think. This is extremely valuable stuff! I mean it answers some of my toughest real-time questions. Wow. Amazing.
Thanks.
Nancy
Good Day Robert,
In most comments (in other blogs) there seems to be just yessings. But in your comments seem to be just full of intelligent readers. In fact today the quote by Gabrielle Fontaine “When in doubt, always charge at least a little bit more than you’re comfortable with.” is well worth reading all the comments. A quote for all marketers.
Thanks Gabrielle,
Chick J
Robert,
I like the concept of increasing the price, but how do you know when you’ve priced things too high?
For example I start my price out at $75 and was getting consistent purchases, then I said let me see how things go at $97. When I went to $97, my sales fell off the cliff.
Does that tell me the highest the market is willing to bear is $75 and I should lower my price?
I even added additional bonuses to the $97 price point to justify the increased price, but still no takers.
I have since lowered the price back to $75 and the sales are flowing once again.
I’d value your feedback.
Gracias,
Stephanie
Hi Robert,
your awesome post inspired me to create a blog post that suggests that visitors sign up to my list to avoid having to pay $97 per month for a membership site that i decided to launch in the Spring.
The payback that I require from them is their testimonials.
In the post, I also integrated an affiliate link to monetize the post. If anyone wants to check out what I did, the web page is hyper linked from my name above.
So hopefully I can get the subscribers and I should have plenty of time to prepare my product offering.
I have not found that price and quality always go hand in hand. Sometimes yes. Sometimes no. It depends on the product.
And how many of the buyers of high-priced products ever make back the money they spent on them?
Maybe I’m not a typical consumer?
Great post Robert. I actually read something similar to this the other day, and I think that it is a great idea. I am still in the phase of selling other people product, but when the time comes that I decide to take a go at creating my own product, this is definitely the route that I will be taking!
Thanks,
Chris J
@Dave I totally agree with what you said:
“I will probably get slated for this comment but there definitely seems to be more interest in how much money one can make than actually helping someone put the product to use and actually get them using it.”
I think there’s not enough focus on making sure people get value and too much focus on how much money we can get people to pull out of their wallets regardless of how helpful a product is.
We all need to make sure we’ve created a great product first, then price it for it’s value but don’t under price.
Hi Robert,
I am launching a product next week. My product consists of software and information product (as a bonus).
My product costs 99 for the basic and 116 for the premium. Since I am a new company, I was offering a free trial download.
I have set up both basic and premium versions of my product. I refer to my price as special price, and after reading your post, I will be increasing the price. Is there a time frame that works best (30 days) or is number of copies at a reduced price the best inducement to action?
I appreciate any feedback.
OK, Robert, You got me too…
Old sell price $100, new as of today $247! WTF:)
Great job, Rich! Now that’s what I’m talking about!
Very interesting answers here… check it out:
Neil = $17
Mel = $27
Clyde = $27/month
Brad = $37
Trevor = $37
Ron = $37
Joe = $39/month
Jeff = $47
Chuc = $47
David = $47/month
Stephanie = $75
Eric = $97
Robert = $97
Barnaby = $97
Warren = $116
Graeme = $197
Gareth = $197
Timothy = $200/month
Rich = $247
Michelle = $397
Gavin = $450
Sandra = $997
Average price point = $179
Robert & Lance,
It’s easy to raise prices…at a fundamental level, it’s as easy as entering different numbers.
Who among us one doesn’t want more money for the value we create or believe we create? That’s what I thought, no hands showing….
In my case, I’ve allowed the “gurus” to brainwash me on “raising the free line.” Once I raised the free line, I conditioned people on my list to expect “free.” The perpetuating cycle extends to lower-priced products, probably perceived as poor by many “would-be” customers.
At least for me, Robert & Lance, the challenge is more than fundamental. I might even admit to a poor model.
So why don’t I change? It’s profitable…BUT not nearly as profitable as (I KNOW) it could be. Sometimes it seems “easier” to take what I’m getting rather than move into the unknown.
Since I recently have discovered Lance & you, I am impressed and grateful. I have DROPPED many gurus who seem to speak a different language…that doesn’t (& hasn’t) worked for me.
Not that I face my reality, I have allowed myself to go in so many directions I don’t know what “model” is “best” for me and my prospects.
Earlier you said, “And then use that ‘not being comfortable’ to your advantage… write better sales copy, write more autoresponder followups, contact more people for joint ventures….”
Of course, you know it’s easier said than done. 🙂
Where do I check out coaching from you guys?
Thanks for another insightful post!
Mike