Sales volume dropped after increasing my price...is this normal?

That is a pretty dramatic raise in price in a short time period, my first reaction is to let it run for a while and let it re-implement. You know it will sell, i think it is just a matter of adjustment.

The above is from a post you made a few months ago - your assumption was sales dropped due to 'recurring' monthly fee - perhaps sales dropped due to increased annual fee? In that post you said you had found "$59 to be the sweet spot".


Looks like it still is. It's been suggested before that you may need to add value or additional products to improve that monthly income Your focus seems to be on increasing the price of the same product.



Because you announced a hefty price increase, you don't know if the January higher sales were due to ads or people joining to 'beat' the price increase.


My guess is you have a $59 product that sells reliably - and my same advice is to create ancillary products to go with that flagship product and raise your income that way.


The only price-play you haven't tried is perhaps making it a 6 month membership for $59 with auto renew every six months. If people sign up for year - do they pay for a second year?

First off you made to many changes at once. To many changes new videos raising the price. You had a decent price point for what you offered. You warned people the price was going up, that is a turn off. You could of came up with a back end product for the higher price where they could buy access to the new site.

Take a good luck how the Casey Research group advertises different products and the Palm Beach group. The entry level prices are high quality, than they have premium products offered. That way you would not annoy your current and future buyers and members may see your quality. Than see the back end offer and buy the premium service.

Could well be sticking to it is all you need - sounds like you've made quite a few additions/improvmeents and you niche is specialized so you will continue to pull new viewers.


Might be good to set a time frame of 6 months (or more) and just leave the pricing as it is while you work on the 'other stuff'....and see if you aren't making more money by then.



You are saying 'total February sales' - but this is only Feb 10. Give it a chance.

I've seen a few of your threads now and I think I've managed to stay away from posting in them because other people beat me to giving the same advice I would.

I've always thought you should develop the additional products that build onto your main, successful product. I don't know anyone with a membership or coaching business that makes the bulk of their income from their front end product. A lot of them give affiliates 100% on the front end to drive in leads to their $500+ products, where the real money tends to be.

I still think this is the way to go. But the below quote gave me some pause:

How much additional work is it for you when a member joins? Or, is the backend pretty much automated? Unless having customers is somehow a hassle for you, then I wouldn't view it as "ripping (yourself) off". I would price the front end at whatever is most profitable.

Who cares if it's $9, $59, $99 or $999? Unless more clients means more time or headache for you, of course. Until you add more products, I'd run it at $99 for a month or two and see how it does.

But I'd spend that time working on the more expensive products, not less expensive products.

Hi Bkelly301,

Obviously, as you now realize, making a lot of changes at once is risky business. If performance decreases, or increases, you will have no idea which changes helped, and which changes hurt your website's performance. Since this is a marketing forum, or at least it used to be, let me tell you how marketing professionals would do it differently.

This is an excellent case for performing A/B Split testing. By randomly splitting traffic between your previous website and your new website changes would help you determine if those changes are helping or hurting.

Chances are that some changes are helping and some are making no difference, or worse, actually hurting your offer's performance. A better approach would be to split test each minor change before implementing permanently, that way you can be sure the change is actually helping to improve performance.

A very good tool for setting this up is Google Optimize, and it's free.

Changes to website content is not the only thing you can Split Test, You can and probably should A/B Split test your price changes to see which price point produces the greatest revenue. Forget about whether your price is too low or not, instead focus on the price point that generates the most total profit.

Let me share an important concept in marketing. People generally will not purchase your offer unless they feel that they are getting far more value than the price they are paying. This is how markets work. If you priced your offer fairly, then you will have the fewest number of sales. Typically, you will only get more sales by offering a better than fair deal.

Test and let actual data inform your pricing decision, not what you feel is fair. Don't let your desire to get a fairer price prevent you from maximizing your profits. Your goal should be to increase total profits, not to merely increase profit margins. The highest margin generally results in the smallest number of sales, and smaller total profit.

Another thing you may want to consider is to offer 2 tier pricing. Offer a limited version at a lower price and create a checkout funnel with a One-Time-Offer to get the full version for just an extra $39 dollars. If they don't purchase the OTO, then take them to a downsell offer to tryout the full version for 30, 90, or 180 days days for only $19, then make a fair upgrade offer at the end of that limited period. By then your limited subscribers will have a clear sense of your offer's value and you will likely close many of those customers that you are currently missing.

Just email, or add a website alert at the end of the full version tryout and make one last special upgrade offer for only $39 at the end of that period before raising the final upgrade price to $49 (or whatever your data shows gives you the most total profit).

HTH,

Don Burk

I really do agree with what dburk is saying.. but I think it could be a lot easier than that... throw the price back to $59.00 and see what happens... if your sales increase to pre price change levels.. then YOU KNOW price is the variable at play. and then find that sweet spot.. next week jump the price to $69.. then $79 and so on to the point you reach the point of diminishing return.

The other side of this is something you will want to talk to your coach / mentor about... in moving things around and changing things have you developed a greater sense of value? or did you just add lipstick? A cleaner funnel that has not changed the build up in value is going to get the same result as the old worn out one.. right?

and flipping this yet again... same traffic equates same demographic.. can your traffic you are currently targeting afford the $99?

I would start with the price bump to understand where the line in the sand is.. and from there... I would get into more calculated testing to understand what in the funnel could be changed to increase the perception of value... and if that even falls short, then you really need to be looking at the targeting of your traffic.. because THAT ( traffic ) in itself is the variable that has NOT changed through the transition from the old model to the new.

This is a problem and it seems to be the decision making style you follow.


You changed the price Feb 1 - on Feb 10 you claim sales are down - after comments from members you say you will keep price there for a while.


Two days later you are changing the price again....12 DAYS into a price change. This isn't the first time - it seems perhaps YOU don't believe your product is worth more.



Why go back to $59 again? Why not do a real test at the current $99 or whatever for a couple months and then, if necessary, lower the price to $79 or so? If you keep dropping back to the original price, maybe just leave the price there and focus on increasing profit with more products.

I understand the 'fear' thing - but you need to give tests a chance to work - go do something else at least till the end of the month....

It is natural or normal if price is high then sale volume automatically decrease. If you want to increase your sale then give some offers on your product.

My 2 cents is that you should have tested the changes you made without a price change. If that proved to be beneficial, then you could have split tested a price change to find what produces the greatest income.

Time of year is a variable you have to account for as well.

Compare Feb 2019 to Feb 2018.

It's one of the main comparisons big box retail tracks that most IM-ers don't seem to think of.

as jmosticc22 said
Its very dramatic increase in a price .. basicslly you doubled it

I would offer them to choose from at least 2 packages with a different packages
setup one with a basic price you had before and one for lets say $79
and watch if it works or not

I'm just going to go with Kay King's advice, and just set the price that I want and forget about it...

I've made sales at every price point that I had it set at so far, including recurring pricing. However, I always start getting scared when I haven't heard the "sale notification" on my phone for a while. This always causes me to revert back to my 'safe zone' which is offering a one-time fee.

I'm not content with that though. Every time I make a $59/lifetime sale, I feel like I missed out on a potential better sale. I'd much rather be acquiring recurring members, so that I eventually get to a point where I am making predictable income each month.

I've decided that since I'm already all over the place here over these last 2 weeks, that I might as well just set the pricing to my end goal which is the recurring model and just accept the fact that there will be a period (maybe months) where there's a decline in sales. Ultimately I feel this is the better strategy long-term.

I've made sales at the recurring price even before I did the site redesign, and I know for a fact I can acquire a few new members each month. I just gotta stick with it.

Thanks for the replies everyone!

The price adjustment still is above 50% of the existed price. So it eventually states itself to the customers that you are starting new, starting something from the scratch unless you provide them with something additional like an update to the existing service you provide. You can definitely stick to your new price but you need to build something around your service that shows some valuable changes that justifies the hike. Remember, Buyers were/are never fair.

You just have a money limiting belief to clear; aka, the fear of a bigger number scaring people from buying. Not true. Like all fears.

Wait, thousands of videos for $59? And who watches thousands of videos?

Maybe you can still charge $59, but instead of offering a thousand videos, you can package it to a smaller course or whatever and sell it at that price. And if they want the advanced videos, they can get the upsell which would be more (at least $197) + include some bonuses if you can.

Sales will go down soon after you change your price on your website. People will have to get used to it. But if you were making sales at $59, why would you increase your price? If you believe what you are selling is worth more, try to segment it to different packages or levels. That's what I would do.

Without knowing what you're selling or how your model works, I can't give you a better answer but if I was in your position, I would test the above idea.

Just my 0,02

Do a split tests with your price.

When I raised my eBook prices from around $7 to $20, I ended up selling about half as many eBooks, but my profit and revenue went way up.

Also, when it comes to pricing, it doesn't matter how much YOU think your product is worth; it's what your customers think. Do a couple different tests and let the free market decide.

That is just my two cents.

I would put the price back to $59 and let them get used to the new fact that it will be $59 forever. And when sales get back to normal, don't touch anything. Just keep doing more advertising and touch nothing on the site that price related.

you already found a sweat spot. next you can do is an up sell . divide content into 3 parts , give them access to 1 then make 2 up sells with more benefits. you will get sales on front end and then on up sells. will not turn off any one. Got it ?

there does seem to be a bit of parallel universe though. Net prices and real world.

Real world people seem to happily pay huge fees.

Net...everything seems to have to be at bargain basement prices.

My personal experience:

After I increase my Facebook cover designing package from $5 to $15 I had a huge lost of sales. The amount I lost is around 80%. Per month I earned over 1 K before I increase price. After increase my sales was around $200 per month. That was insane. Therefore I have to reduce my price. Now the current price of almost all my graphic design product is around $10. It increased my sales back again up to $600-$800 per month. But still I have loss of 20% from my profit. But sales wise it is almost 50% drop.

I don't know it may flag as a spam if I post a link. Therefore I won't post any links to prove what I had. My advice is if you want to increase price do it very dramatically. Don't do any drastic price changes.

Good luck.

All I know is that once I raised my cost to $99, the business volume recognizably dropped. Truth be told, I just completed 4 deals aggregate in February at this new cost

There really isn't any right and wrong answer to that.

Given the hard economical times, it is natural for people to spend less and yet expect maximum value from what they are getting.

What I will suggest if you still want more sales after raising the price is to do 2 things.

1. Conduct interviews with other IM experts and upload into members area.

2. Create software tools to help members get the tasks done faster and more sales and leads. Either by yourself or developers you hired.

If what you say is indeed correct then the $99 dollar should be fair, or you could even raise it up a bit more. The problem here is that your current audience is still in the $59 dollar mentality and the rise has been around 30% more which is a bit drastic to some. Try to get more audience and let them in your group. Most times you need to have the right audience.

It might not be anything to do with your price rises.


I sold 6 products in January, but so far there have been no sales at all this month.


I attribute it to either people making New Years' resolutions to do more blogging (I sell SEO tools) or maybe I got some hot referral traffic from an unknown source.


Actually today I just found out one of my email list subscribers recommends my tools - maybe I made all those sales from his super pursuasive mailshot.

If you make any adjustment to the product (i.e. pricing), you may have to adjust your target audience, even if the changes are minor on both fronts.

Hi Bkelly,

Interesting post, interesting enough to drag me out of the shadows to make an account abd finally post anyway. ;-)

Firstly I remember reading one of your threads where you said you were going to pay a guru to help you set up your site and add an aditional section as a kind of joint venture.

Did you go ahead with this? If so I'd be interested to hear his views about your price structure. What did he advize you to charge?

As for recurring fee or one off. Its hard to say without knowing your product but I think that the recurring fee for educational products is good but you have to remember that most people will only sign up untill they feel that they have got what they need out of it. They might stay signed up for a year but probably not 2 years and highly unlikely 3.

I base this on my own online spending habits. For example, I'm a guitarist and signed up for Guitarport online. I think I stayed signed up for about 6 months in all.

Its hard to say without seeing your site but from what you've said instead of increasing the price of your existing product (which seems to be doing pretty well) I'd tend to think about creating a second product.

Plus, you seem to have an audience of musicians who will be regularly visiting your site and who repect you and trust what you say. After all they are prepared to pay to hear what you have to say right ?

Have you thought about levering this and promoting affiliate products that they need to buy on a regular basis?

For example, most gigging guitarists will replace the strings on their guitar(s) at least once a week. They also need a regular supply of plectrums. Drummers need replacement sticks and skins etc...

Then there's recording software. What software do you use to record with? Why do you use it? Can you make affiliate sales?

Read this blog post on Clients Oasis. It will throw more light on what you're doing wrong and probably point you in the right direction of closing more sales, especially if they're high ticket sales: https://www.clientsoasis.com/how-to-...-being-salesy/

It is obviously natural. if you are the only company which is selling demanding services/products then you can raise price at any level but on competitive market, price play important roles.

Have you thought about buying traffic?

That's one of the easier ways to scale and if $ 3K a month is your goal ... it might just be the best way to achieve that. Also fastest.

I may have missed it, but do you know what percentage of your past revenue came from recurring customers, as opposed to new customers?

If your past monthly revenue was generated primarily from new business, i would imagine you have a different issue all together.
however if that is the case.... have you considered using the "1 week free" method and requiring a card to get the free wee, then auto bill after? I know thats nothing new, but I have like 7 of those things auto debiting my account every month....I hate it, but its so easy to tell yourself, "i'll cacnel later tonight" and then a new show is suddenly on Hulu, which prompts.. "Ok...one more month... its only $7.99"...

Also, I think the price hike could be a bit steep depending on the content of the site.

.

I perceive the 'fear' factor - however you would like to grant tests an opportunity to figure - go do one thing else a minimum of until the top of the month... then success

I haven't been here for a while getting back into it, It seen to me when you changed your prices on your services you step up into an area of new customers that can afford to pay your prices.

Yes, this is very normal don't worry about this.

If people are getting enough value from your videos, then charging more is justified. However, a random pop up displaying, "we've raised our prices" isn't the best way to go. You might need to invest in top-notch copy writing to justify the sudden price increase to past subscribers.

As others have said, the increase should be done gradually, in a longer period. Also, you can play a bit more with the price, lower it just a little, use psychological levels etc

Yes, it is normal and has been that way since the Medieval markets in Europe.


What happens when customers realize the price is rising? Typically they buy from someone else or do not buy at all..

.. thus the sales volume dropped after increasing the price.

More importantly, how do customers Brand your business? Nothing more than an attempt to gouge the customer is one way. How do potential JVs brand your business? Knowingly or unknowingly your Brand is that of an opportunist that almost all JVs stay away from.. Guilt by Association.

The path you are traveling on has put many a Warrior either out of business or hiding behind other warriors.

You should have considered your price structure before you decided to gamble with the sales volume and gamble with your brand.

Fortunately, it is still early enough for you to Do Your Customers Right.

How much of your traffic would be coming from price comparison sites? If it's a fair share, this could be impacting your sales moreso than if most of your traffic was performing site-based research.

I would suggest you not to drop the price. Try to explain your user or visitors that the content or resources you are offering at $99 is still a good deal. You can offer some samples to your visitors so that they can have idea about the content. Once they are satisfied with the content then they will surely pay you $99.

The rise in price is high

It's like you keep walking into the same wall, turn around and walk into it again...repeat. You have a product that sells so you are trying to make it jump through hoops. I predict you will be back posting something similar as you've done now how many times?

Have you thought about buying traffic? ( FB ADS ... etc )

Selling at a lower price often increases your sales volume, hopefully making up for your decreased profit per unit by returning bigger gross profits. ... In a best-case scenario, a price increase creates enough perceived value among consumers that you realize both increased profit margins and sales volumes.

It's normal of course. But if you sell 2 instead of 3, that's still profitable for you

It's simple,,your actions caused it..to me price increase should be slow and gradual.

It depends in your audience mindset, maybe you dont have the right audience for that price point or you need to make a sales page with a good pitch explaining everything they will get for the $99 ... maybe a video inside of the membership area.

You need to see if when you changed your price, did you also used advertising for those who can pay the $99 price.

See, you had your audience, those who can afford to pay the $59, and if you tried to ask that same audience to pay more for the same product, I can see why the sales are dropping.

If you set a different price, that means you are pointing to a new audience, did you check that?

Hi there,

Pricing may not make much difference but what does matter is the value.

What value your product is creating? Is that worth of $99? If yes, then you should stick with it.

We have faced the same obstacle a few years back and to reach the market I have used tools like woodpecker and AeroLeads which helped me to research the market.

With this, I reached to my clients and influencer and enquired about their feedback and thus, this method helped me to convert more customer, by delivery them greater value.

It's too dramatic of a price increase bud

Well this is quite normal, you gonna make a lot of money with two ways in this economic world. The first one is by selling low cost products but make profits with high volume of sales like tesco, costco and walmart stuff. Or you can sell high cost products such as ferrari or lamborghini with high profit margin