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Competition one-upped me! In need of an idea!

by Seekness
9 replies
Hey everyone,

This fall I'll be launching a new product on my website. It's a product (data-based) that exists in other places, and has always generated a one-time subscription fee. The conversion rate on this product is very high as it's an upsell to a free service, but a pretty necessary one.

One of my major competitors has always sold this for about $10.00. Very recently, they announced that they'll be giving it away for free going forward. We were going to come in at a lower price (about $5.00-7.00) for the same kind of product, but this puts us in a really tough spot.

Even if ours is better, people will still likely use the free one over ours.

I'm thinking I need to change up my strategy. Charging money for it might not draw in many buyers.

My thinking is that maybe there's some kind of affiliate offer or survey I can ask my user base to buy/complete in order to get access to the data product, which they'll then get for free. It's a very engaged product I'm offering so my line of thinking is that they'll be happy to spend a few minutes completing an offer (or maybe even a few bucks if they're getting something of clear value) if they're getting free use of the product after that.

Any ideas for an affilliate deal that gives me about $3-5 per sale and doesn't require much of a financial commitment (if any) from my users that I could offer them? Maybe a survey offer? The logic is that if I could bring in a few bucks for each referral (if an offer like this exists), I might in fact have a higher overall conversion rate than I would have at the $5 or $7 price point for the product itself.

Any and all thoughts here are appreciated!
#competition #idea #offers #oneupped #surveys
  • Profile picture of the author Daniel Brock
    Well there is no way you can compete with a free product no matter how low your price is. So you should increase the value of your product and position it as a premium item instead of some cheap $10 download.

    Dont know it is possible for you to do it in your niche though
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    • Profile picture of the author Seekness
      Originally Posted by dbbrock1 View Post

      Well there is no way you can compete with a free product no matter how low your price is. So you should increase the value of your product and position it as a premium item instead of some cheap $10 download.

      Dont know it is possible for you to do it in your niche though
      Neither product is a cheap download. They're both pretty high quality. My overall (free) service has more to offer than theirs, but this might not be enough to justify people paying the price for the download.

      I really don't think that people would mind completing a survey or any other kind of offer that nets me a few dollars at little expense to them. Any ideas?
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      • Profile picture of the author bemore
        Dandee,

        I tend to agree with dbbrock1. Many people are still willing to pay so you must position yourself in the other premium market as opposed to the freebie seekers. Heap on some other products into a package and offer it for $47 instead of the $3-$5 range. People love to buy packages and will gladly pay the higher price for multiple items. If you offer a service, give them a month or two for free after they purchase your higher priced package. You lose nothing and may potentially gain a customer from something that didn't cost you a dime.

        Can you offer a service, report, videos or something else that compliments your products? Maybe offer it to another marketers mailing list if they'll let you. Try to find the markets that the competition isn't targeting. Do what they won't.

        Just look on Ebay. There are many prople selling the same thing and sometimes, some will get 5 times as much as the next guy. You have to come up with a different angle. Maybe posting what you're selling on this forum might help people give you a better response. You want to let your competition take the freebie seekers and you stick with those willing to pay.

        Of course, you can also give it away and offer a killer OTO for high end backend sales. There are many ways to go, you just have to get creative. Think about what they're doing to one up you. Sign up to their mailing list, check up on what they're offering their customers, look at their OTO or sales pitch and find out what you can do better. Maybe see if you both can work together and help each other. Just some random thoughts. Hope they help. Take care.

        PS- the survey idea is great. But ask your customers what you can do to give them more value, what they'd like to receive from you, how you can gain their loyalty. They will usually give you all the information you need to best your competition. Everyone wants their opinion to be heard.

        Patrick
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        • Profile picture of the author Seekness
          Originally Posted by bemore View Post

          Dandee,

          I tend to agree with dbbrock1. Many people are still willing to pay so you must position yourself in the other premium market as opposed to the freebie seekers.........

          Patrick
          Patrick,

          Thanks very much for your insight. Maybe I wasn't clear enough in my original post, so I guess I should elaborate.

          This is a data feed that people will be receiving in fantasy sports leagues with live, up to the minute stats. Previously, users were paying Yahoo! $10 for access to this feed for a season. We were coming in at a lower price point for the same access they'd get there, but now Yahoo is giving it away for free.

          Our general fantasy league platforms will have more to offer than theirs, but a very feature-rich Adobe flex application is very hard to one-up them on when we're talking about having it ready for the 2009 football season. It's a technology play that quite frankly, they've executed really well.

          Those who bring up the points about products selling for more because of how they're presented, I'd generally agree, and I'm sure those buyers exist...but this is a pretty well-known space I'm competing in where users are generally well aware of what's out there.

          I've built up enough incentive to draw users into my game, and do believe I'll be able to pull people away from the bigger sites, but the profitability assumptions largely rested upon the sale of this live stats feed. There are other things that can be offered for money, but the live stat feed is historically proven to be the thing that people are most willing to pay money for.

          Which leads me to believe that I may be forced into giving the data away for free, so I'm looking for a way to earn something for each "buyer" of the feed, since I do believe they'll be willing to invest something in order to get it - even if it's not outright cash. If I can extract value via this method, I'm just as happy.

          That's why a survey requirement (or anything similar) comes to mind if there's anything that anyone knows of.
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          • Profile picture of the author bemore
            Dandee,

            Ok, now I understand. I would think off the bat that you will not be able to compete with Yahoo. I could be wrong. But, you can monetize the pages that the feeds are available on. For instance, if it's a high traffic site, why not offer physical products related to the feeds content. T-shirts, sports memorabilia, cards, collectibles, etc.

            How about Adsense ads on the same page? How about Ebay auctions widget selling whatever it is that is related. You could sell banner ads for other companies and generate revenue that way.

            Don't lock your thinking into only one avenue. How about offering tickets to events. Can you incorporate a betting site for these games onto your page where the feeds are? How about some kind of CPA offer? Maybe an affiliate program of some kind. What is Yahoo offering on their pages? They have to make money too, so look at what they're offering and see if you can duplicate it. You dont have to reinvent the wheel and only need a small piece of the action to make money.

            There really are a thousand ways to take this. You have to start thinking outside the box. Obviously the feed part is one thing, but I'd be looking at monetizing every related category instead, and make the feed part of your traffic generation strategy. Just my opinion, of course. Hope it helps. Take care.

            Patrick
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  • Profile picture of the author EdmundDantes
    I think you have a couple options here:

    1) Increase your offering
    2) Give it away and couple it with better upsell items to offset any costs you might have
    3) Promote the product to places your competitor is not and split test it while charging what you want.

    I sincerely doubt that your competitor has covered all the marketing aspects. After all, most products that you can purchase that are information based can usually be found for free elsewhere.

    Most of the time you are not selling the information per se but rather the grouping of that information and allowing it to be readily available to those who are seeking out this information. Having this information readily available would save some time and energy so it justifies a cost for it.

    Try a couple different methods and test them out. Obviously if your competitor is advertising where you are it would not be a difficult choice between free and paid. But if they are not there than you can easily put a value on your product.

    My .02
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  • Profile picture of the author CDarklock
    Originally Posted by dandee0014 View Post

    Even if ours is better, people will still likely use the free one over ours.
    You're looking at this the wrong way. Your market is not people who want a free product. It's people who want to buy a product. They are moving to a different market. You will now own the market of people who want to buy, many of whom will ALSO want the free product. But where they would previously have paid $17 for both products, now they only pay $7. Everybody wins.
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  • Profile picture of the author Pufferf1sh
    Yes - agree with the other posters. First thing that came to my mind when reading your post is that you should increase the price. Your competitor takes the low end and you concentrate on the higher end. Are they giving it away free with no additional backend costs? Or are they trialing the product for free?
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  • Profile picture of the author ecoverartist
    Hi Dandee,

    One thing you might want to do to help expand on the better value your version provides is to do a benefits comparison chart. You're dealing with a big giant of a company here so it's hard to outplay someone with bottomless pockets. You could capitalize on the fact that perhaps they don't have the fanbase that you do nor the interest in fantasy sports - i.e. they're just doing it to get people to sign up, they're not really "into" it for the love of the game.

    Just a thought! If you do make a comparison, make sure it's a fair and accurate one, otherwise it could come back to bite you!
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