A Discovery About Price

4 replies
I bought the Launch Tree and went through the main course already. There was a video with Frank Kern and in part of it he talks about price. He says that customers who bought infomillionaire as a whole asked for more refunds and were more aggressive and sometimes nasty in their emails than those who bought mass control.

He says the higher the prices you charge the less refunds you get and the less you charge the more refunds you get. He said he didn't know the reason - but said that what he has learned is that when you charge less you have to constantly reassure the customers that they made the right decision and that you care about them. He said be available to answer their questions.

I've been having a talk with someone about this. I've been in the stock market niche for ten years and have charged from $55 to $495 and found what he says is totally true.

For the exact same product if I have an option of $55 a quarter or $175 a year the people who pay more refund less - and not only that but the people who pay less tend to be more mean or aggressive in their support emails.

In my business one of my friends says these people are just deadbeats that want something for nothing. Like they sign up get your stuff and get the refund.

Thinking about this after watching Kern talk about you need to reassure the people I've come to a revelation that this isn't the case at all. That what is actually happening is that for whatever reason when someone pays a lower price they trust you less than if they pay a higher price. They are more skeptical.

Therefore after they buy they have a tendency to doubt more and imagine reasons to think they made the wrong decision. Where when someone pays more they are more confident about their decision.

One can wonder is it because the people have less money and that is why or is it the price itself that effects their customer behavior. LIke does it make sense that a product that promises to make them money and change their lives cost less than $100?

Other cheap products are crap they bought so they are on guard.

The bottom line is I took from this the idea that you need to rally overdeliver and reassure people when they pay low prices. Ironically it takes more to make someone who paid a cheap price happy about their purchase decision than someone who pays more.
#discovery #price
  • Profile picture of the author Andyhenry
    Isn't this obvious?

    When people spend more money - they think more carefully about the purchase and so unless you disappoint them - they should be getting what they want and be happy.

    If you're selling stuff so cheap that they don't have to think much about the money, they can easily buy it without really considering whether it will help them and then be easily disappointed when they realise what they got.

    This isn't rocket-science, it's just basic pricing vs value - if people have to think twice about the price, they won't make a rash purchase which they'll regret.

    This is why I usually give away my info products for free nowadays - I only focus on selling high-ticket items to people who really want them.

    It can get frustrating trying to keep a lot of people happy and selling low ticket stuff.

    Andy
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    nothing to see here.

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    • Profile picture of the author Asher
      Originally Posted by Andyhenry View Post

      Isn't this obvious?
      To be really truthful, I had no idea about the value of
      pricing until I read "Influence" by Robert Cialdini.

      Simply because I am moving from a customer's
      perspective to a seller's perspective. So, knowing
      about pricing and how different people react to
      different prices is a valuable obvious insight.

      Asher
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  • Profile picture of the author JRG
    When I sold cars, the people I made the most money on pretty much never complained about anything. Was the easiest sales. Then the customers I barely made anything on would be the hardest to deal with and would have a complaint within days.
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  • Profile picture of the author mrechichi
    From my experience a majority of people purchase on perceived value not price. As long at what you are selling offers a clear solution for a particular problem to a target market, then price is generally not an issue.
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