10 replies
Hey all,

Got a quick question. I have a, let's say, very good quality product. It's going good. Now I'm in a phase where I'm experimenting with different prices, and I've developed some theories on that (I'll share later), so... first I was selling for the "regular" price, 47$, then I put the price on 97$ - and it's also selling okay, but I still feel like it's not the right price which will bring the most conversions in the end.

I was wondering what your opinions are on pricing. Would you rather charge big bucks if the product is really good - and make it more "exclusive", less people would buy, but you'd get more money per sale - or (I was thinking about this), would you charge a really small amount - like, 20$ or something like that - and maybe earn more money since more people would buy the book if it's that cheap.

What do you think?

Thanks,
Jack
#high #low #sell
  • Profile picture of the author prashie91
    here's the thing.

    our opinion doesn't matter. what matters are the results of a split test,
    which is what you should do.

    test conversions at a few prices. that'll give you better answers than anyone's
    opinion.

    cheers

    prashant
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  • Profile picture of the author Jackbgd
    Okay, here's my price theory, I have time to type after all.

    This is my theory - If you have a really, really good product, a nice looking sales page, that looks really high quality - people on the sales page have this feeling - a value perception - as they are reading, in their head - they form an idea of what the price might be. Depending on their perception of value and price.

    What you have to do - is hit that exact price which is in their perception range. So - if they see your page and think "Wow, this is really cool, it has to cost a lot" - but in the end you charge LOWER than what they expected - they don't buy the product. Because you devaluate it - and they might think it's a scam. So they don't buy.

    I have a feeling that many people are doing this, for example - the discount pop-up works for some. For me? It didn't work at all. What I see people do is - they have a crappy sales page, really boring looking, not even interesting content - the perception of the customer is "it maybe costs 20-30$ maximum" - then, when they see that it's, for example 47$ - they just click the X button, because the price is not in alignment with their perceived value and expected price. So they Click X, out of a sudden - they get a discount, now it's half the price - "Oh, now that is much more close to what I was expecting" - and they buy. That's why pop-ups work for people with low quality products. I know this since I've been promoting some products - and 90% of their sales were from the discount pop-up.

    Anyway - to conclude this - I think that the price you put on your product - has to be completely in alignment with the perceived value of the potential customer. Anything under or above will result in much less sales - because trust goes down and "scam alert" goes up.

    Share your opinions.
    Jack
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  • Profile picture of the author sijugk
    As long as there is no active competition, you can fix your product price. In long term plan it is better provide the product in a reasonable price.
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  • Profile picture of the author milan
    If you want to maximize your profit than it simply comes to testing one variable: conversions, and tuning the price to get maximum visitor value.
    You test: what is the number of people who buy, out of 1000 visitors. Let's say your price is $47 and 200 buy out of 1000. You've generated $9000 in sales. Let's say you raise the price to $97, and (usually) less people buy. But it depends on how much less people buy. If 150 buy out of 1000, you got $14550 in sales. So, simply compare $14550 with $9000 and you'll see what the better decision is.

    Testing the price is very easy, you simply change it and see what are the results.
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  • Profile picture of the author prashie91
    jack,

    once again, i have to say this. the only way you'd know for sure
    which price a product converts best at is by doing actual split tests.

    theories don't count for anything in the end.

    plus, this theory isn't exactly true either.

    there are plenty of high quality products out there, which would look
    to be worth easily about a hundred bucks selling for somewhere around
    $10-$15.
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  • Profile picture of the author Bill Corners
    If you have a high quality product, good sales page and graphics, little or no competition, then keep selling it at higher prices until you find that no one wants to buy it anymore.

    There's a particular term for it in marketing, can't remeber it at the moment, but psychologically, there's a price that people won't pay above for a certain product, so just keep pushing it up and test to see how far you can go.

    Good luck!
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  • Profile picture of the author Kevinwills
    Reducing price will get more sales.If previously you gave it for 47$ then you must stick on that even when you update your product.
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    • Profile picture of the author Jackbgd
      Originally Posted by Kevinwills View Post

      Reducing price will get more sales.If previously you gave it for 47$ then you must stick on that even when you update your product.
      Why? Elaborate please.
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  • Profile picture of the author Paul Hancox
    It's called PRICE ELASTICITY. It's a situation where price / demand is flexible enough that you can put your price up and still make more money.

    In my pricing report, I give an example of a walkie talkie that was sold for three different prices: $14.99, $19.99 and $24.99.

    After six weeks of testing, the middle price ($19.99) sold best. So it's NOT TRUE that lower prices will always sell more - it depends on the circumstances.

    The way you price test is you run a SPLIT TEST, making sure that the same visitor sees the same price when they return. Simply changing the price every so often is not a split test.
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