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Determining PRICING for your products

by JCWHong
7 replies
Hey everyone,

For those of you who have created an informational product (ebook, video, CD, etc.), how did you determine the pricing for it?

Thanks!
#determining #pricing #products
  • Profile picture of the author TheMagicShow
    Originally Posted by JCWHong View Post

    Hey everyone,

    For those of you who have created an informational product (ebook, video, CD, etc.), how did you determine the pricing for it?

    Thanks!
    You look at the competiton and the market value for the product that you are trying to sell, then you formulate an idea on what to price your product, you can also split test two different prices over a period of time and see which one pulls more sales and has higher conversions.

    Cheers,
    Magic
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    " You can either give a man a fish and feed him for a day OR teach him how to catch a fish and it will feed him for a lifetime"

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  • Profile picture of the author Diego Norte
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    • Profile picture of the author gefflong
      Originally Posted by Diego Norte View Post

      There is research that shows that the digits 0, 1, 3 and 5 are the most profitable digits. Furthermore, ending in a 0 or a 5 is most profitable (despite the 7 madness started by a rather small offline test by Ted Nicolas).

      That narrows things down to the digits and the order.

      There are also some expectations that lead you to a general price based on what others have done (although it's fun to break through these barriers sometimes). The standard prices become:

      Ebook: $50
      Video: $100
      CD: $50

      Now you just test. Load it up in a multivariate package that can handle price testing (most don't). Obviously I am going to recommend my own multivariate software.

      Load up the surrounding prices. If you are doing an Ebook or CD, load up $35, $50 and $100. If you are doing a Video, load up $50, $100 and $150.

      If testing shows that $50 worked for your Ebook or CD, then keep it. If $35 was more profitable, add $15 to the test. If $100 was more profitable, add $150 and $300 to the test. Same with a Video. Just add in the next lower profitable price to the test if an outlying price won in initial testing.

      If you want to play with other kinds of products, here is a complete list of pricing to test:

      $1
      $5
      $10
      $15
      $30
      $35
      $50
      $100
      $150
      $300
      $350
      $500
      $550
      $1000

      You just repeat the pattern for higher prices.
      You aren't by any chance James Brausch are you?

      I remember him pushing the same "research" back in the day.
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  • Profile picture of the author JCWHong
    Thanks, guys.

    What's your advice on how to split test the website? Create two identical websites with different prices? Or just test one price for a certain amount of time and then the other one?
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    Justin


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    • Profile picture of the author Ross Dalangin
      Originally Posted by JCWHong View Post

      Thanks, guys.

      What's your advice on how to split test the website? Create two identical websites with different prices? Or just test one price for a certain amount of time and then the other one?
      If the pricing is an issue with split test then only the price will change. When you already know the pricing then it's up to you to split test the headlines, design and/or the whole sales letter.
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  • Profile picture of the author Ross Dalangin
    Right now I'm testing the price of my product at WSO by placing a caption to name your price and I'm amazed at the result. I'm not suggesting you tell them to name their own price also but it's what I'm testing right now. I'll let warriors know when my test is done. So far, it's good.

    Before, to price my product, I put myself in the toes of my buyers. How much will I pay for this product if I need or want it and don't know how to do it myself. It's very hard but challenging.

    Another method is pricing it for a few dollars then increasing the price each day or week.
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  • Profile picture of the author Jared Alberghini
    Take a step back, try to think as your customer would think... If you were a customer looking for your offer, what would you pay for the solution?

    Also, obviously, find similar offers and get an average price range that others are charging for similar solutions... and go somewhere in the middle.

    Hope this helps!

    - Jared
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    Join The Future: Telekinetic Marketing

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  • Profile picture of the author Paul Hancox
    Hi Justin

    First, consider the price for comparable or competing products.

    For instance, let's say you're selling a dating ebook. Well, you can get them ranging from $20 (Double Your Dating) to $50. There are no doubt a few higher priced ebooks as well, but most ebooks on dating are in this lower range.

    This tells you that the market considers $20 to $50 to be reasonable for a dating ebook, although this is just a very rough guide.

    You then have a number of choices.

    You can sell it for more, and make sure your ebook is distinguished from your competition (i.e. more valuable, effective, exclusive information), and to set it apart from the rest.

    And / or ...

    Change the format of your product, to something which is perceived by the market to have a higher value.

    There are quite a few dating videos, CDs, DVDs and such that sell much higher than $50. (Some of David DeAngelo's Double Your Dating products sell for $500!)

    That's because, for whatever reason, the market considers these formats to me more valuable.

    Ultimately, when it comes to information marketing, you can set whatever price you like in theory, but you'll need to consider...

    (a) Affordability. Can your target market afford $997, for instance?

    (b) Competition. If everyone else in your target market is selling $20 to $50 informational products, you need to justify to your customers why yours is $99, say.

    (c) Value for money. If I had a 1 page ebook that contained the EXACT location to $1 billion of buried treasure that was 100% GUARANTEED to be there, how much would you pay for my ebook? I could probably sell just 1 copy for a HUGE amount of money, because of the value of the content.

    Frank Kern chose to sell his Mass Control course for $1,997.

    Way above what his target market often pay for information products such as downloadable videos.

    Yet people paid.

    Was it worth it?

    To his happy customers, it was no doubt worth it. (If he had any unhappy ones, then to them it wasn't worth it.)

    I'd say that probably the two biggests factor that enabled Frank Kern to sell at $1,997 was credibility and reputation.

    Frank was already well-known in the IM community, and had built up credibility and recognition, so he could easily "get away" with charging a premium.

    It's like why Nike can charge a premium for sneakers / trainers. Branding, aka credibility and recognition.

    On the other hand, I've seen newcomers (and even veterans) to the IM industry sell volumes of stuff in a WSO, for $1 or $7, because they want to sell quickly, in large volume.

    It's the Wal-Mart principle.

    So you also need to determine whether you want to be Nike, or Wal-mart...

    ... or both.

    You could sell a low priced product at VOLUME, and then a premium product as a backend product.

    This is the strategy David DeAngelo used (Double Your Dating) to build a $20 million a year business.
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