72% Conversion Increase After Price Increase

13 replies
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Hi guys, just to let you in on the wonders of 'micro' continuity, I changed my membership site (business student niche) from $97/month to $7.77 for 3 days then automatic 24.50 per week (effectively $106/month since a month is 4.35 weeks).

Result is conversion increased from 2.2% to 3.8%. Huge.

That is all...
#72% #conversion #conversion rate #increase #increase conversion #micro continuity #price
  • Profile picture of the author VideosByIvy
    Do you think the trial offer ( 3 day) helped too?
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    • Profile picture of the author junkofdavid2
      Originally Posted by VideosByIvy View Post

      Do you think the trial offer ( 3 day) helped too?
      Perhaps...
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  • Profile picture of the author Joseph Then
    After checking the sustainability of the new trial users, you may want to test having 2 options: $97/mth and $7 for 3 days trial.
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    • Profile picture of the author junkofdavid2
      Originally Posted by Joseph Then View Post

      After checking the sustainability of the new trial users, you may want to test having 2 options: $97/mth and $7 for 3 days trial.
      I'll probably test a pricing table with 3 choices... 97/month, $7 for 3 days then 24.50/week, then maybe an expensive annual plan for maybe $700 or so.

      I'm a bit afraid of the annual plan though, it would be painful (for me) if they file a chargeback in the distant future after the customer takes advantage of the plan for a long time. What do you guys think?
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  • Profile picture of the author junkofdavid2
    Still too early to test sustainability... but with the 97/month option I had problems of (a few) members "forgetting" and then finding it painful (97 is indeed painful even for me) and then filing a chargeback or going crazy asking for a refund with "I am a single mother with 2 kids!" and stuff...

    I once even had a 4-month chargeback for $400 (plus penalties!) filed against me, and then I contacted the buyer directly to ask what was wrong (and even showed my willingness to resolve and possibly send then a refund) they just ignored it (obviously just trying to rip me off). I decided to fight that case and luckily I WON (after many inconvenient grueling phone calls with Paypal representatives) but that was a close call and stressful.

    I would think that it wouldn't be as "painful" at 24.50 and so less or no chargebacks (perhaps just a cancellation of future payments). I also don't think the buyer's case would look credible if they asked for 4 months x 4.35 weeks = 17 chargebacks, LOL!

    Note that this is not IM niche, it's "business students trying to graduate" niche
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    • Profile picture of the author Raydal
      Originally Posted by junkofdavid2 View Post


      I once even had a 4-month chargeback for $400 (plus penalties!) filed against me, and then I contacted the buyer directly to ask what was wrong (and even showed my willingness to resolve and possibly send then a refund) they just ignored it (obviously just trying to rip me off). I decided to fight that case and luckily I WON (after many inconvenient grueling phone calls with Paypal representatives) but that was a close call and stressful.
      There is NO way that a customer should be able to get a refund on multiple
      payment for a SUBCRIPTION unless their credit card was stolen and
      illegally used. If you were not satisfied the first month why would you
      pay for the other months. I run amembeship site so I know that some
      people can forget the payment and so I use the membership script
      to send them a "warning" a couple days before the payment is due.

      If someone was surprised by the subscription then I would refund them
      but never for the previous payments. Once you indicate to PayPal
      that it was a subscription you should have to problem winning this
      case. All you had to do was to escalate the case to let PayPal decide
      and indicate that it was a membership (digital product), end of
      story.

      That is why I like the couple days trial because the prospect has
      some time to review what you offer and then decide if s/he
      wants to continue. You also need to state clearly what your
      refund policy is.

      BTW, that's not a valid price increase test but price amortization
      test.

      -Ray Edwards
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  • Profile picture of the author WillR
    A little too early to call anything yet. Obviously the lower price is a less painful point of entry so the real test will be what happens when the rebills occur. Until then you can't draw too much from a test like this.
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  • That is great, keep testing. Good luck!
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    soon people... Relax...
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  • Profile picture of the author junkofdavid2
    Hi guys, as an update; I started this 3 weeks ago and so far I have a 70% retention rate... which includes both (3-week) old and (1-day) old signups.

    Actually, how do I compute sustainability or retention in this case? Some are old signups (for which retention is a good sign) and some are new signups (too early to tell how long they'd stay).
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  • Profile picture of the author junkofdavid2
    UPDATE: Out of 16 signups under the 7.77 trial, 14 members ( 88%!) stayed on for at least one more period and paid an additional 24.50 (a few stopped subscription after one payment, some stayed on until now for an additional 2 to 3 weeks).

    INTERESTINGLY: I also tested FREE 1-WEEK trial and then pay to continue, and it had a *much lower conversion rate overall*... and then ONLY 2 of 8 stayed on for an extra week and paid an additional 24.50.

    In other words, the 7.77 paid-trial customers were much better customers in the long run for BOTH initial conversion AND sustainability.

    Comments?
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  • Profile picture of the author pjman
    For years, I tried every pricing scheme known: Trials, add-ons, upsells, you name it!

    I found it by far best to offer clear and fair pricing. This allowed to stop worrying about customer service and focus solely on my products/services. This allowed me to build 5-6 sites all generating cash.

    I know my conversion rates could by 15% higher with trials, but chargeback hell ate up more than 30% of my time. You have to think long term with this, I find.
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  • Profile picture of the author altonroot
    $97 looks bigger while $7.77 looks small with naked eyes! That's reality buddy!
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