10 {{ upvoteCount | shortNum }}
10 {{ upvoteCount | shortNum }}

Offer installments for $47 item? (pricing strategies)

by sharris203
9 replies
I'm strategizing. I have $27-$47 items, higher prices compared to others in my niche (but also high quality). Do you think it may be beneficial to offer installments - with the hope that they'll buy more often? 5 easy payment of $9.99, for example.

Or may it raise the risk of them just canceling the subscription the next month. I use PayPal for now. Instant downloadable products. Thoughts?
#$47 #installments #item #offer #pricing #strategies #subscription
  • Profile picture of the author Steven Fullman
    Installments for a $27-47 product?

    I wouldn't.

    If you're worried about the price, offer a 14 day trial or something.

    Steve
    Signature

    Not promoting right now

    {{ DiscussionBoard.errors[3106492].message }}
  • Profile picture of the author mywebwork
    I agree with Steven, installments for products priced that low don't make much sense. And if this is an instant download how would you handle cancellations?

    For digital products that are not sold by subscription installment payments don't sound like a practical idea IMHO.

    Bill
    {{ DiscussionBoard.errors[3106743].message }}
    • Profile picture of the author Laurie Rogers
      I wouldn't offer installments on product with a price point of that margin, I do believe installment payment options usually start at a product with a value of $500 or more as a rule of thumb.
      {{ DiscussionBoard.errors[3106769].message }}
      • Profile picture of the author JohnMcCabe
        The price point isn't what would scare me away from the installment idea. It's the instant download combined with the installments.

        Many real-world companies are using small installment payments for subscriptions - like magazines. I believe it was TV guide that offered "three easy payment of $3.99" for a subscription.

        Others will offer a nifty bonus, but you don't get the bonus until after the final payment is made. Think Sports Illustrated and the football phone, video game, etc. offers.

        You could test this, but I don't think I'd go past three installments just to keep it in single digits (3 x $9.97 = $29.93 for a $27 cash product).

        If you want to see what happens, split test it on one product. If people start bailing out on the installments, kill the test. On a digital product, even if you only get the initial payment, you should make a profit once your sunk costs are covered.

        One caution, though. I would limit the test to sales I generated myself rather than sales by affiliates until I had a handle on how successful it would be. You don't want to go in the hole paying affiliate commissions, although ethically that would be preferable to stiffing them because of your pay plan...
        {{ DiscussionBoard.errors[3106850].message }}
  • Profile picture of the author Lance K
    Originally Posted by sharris203 View Post

    I'm strategizing. I have $27-$47 items, higher prices compared to others in my niche (but also high quality). Do you think it may be beneficial to offer installments - with the hope that they'll buy more often? 5 easy payment of $9.99, for example.
    There's something I'd get a handle on prior to thinking about offering installments...

    What makes your items worth more than the market norm?
    Signature
    "You can have everything in life you want if you will just help enough other people get what they want."
    ~ Zig Ziglar
    {{ DiscussionBoard.errors[3107019].message }}
  • Profile picture of the author Sirius Lin
    At that price point, I'd take a one-off payment, but offer a 30-days no questions asked guarantee instead. The price point for me is too low to warranted repeated Paypal fees, and not to mention, the likelihood of people cancelling the instant they receive their download.

    ~ Sirius
    Signature
    {{ DiscussionBoard.errors[3107083].message }}
    • Profile picture of the author DanFaggella
      ^^ I'm definitely not an expert, but yeah the instant download thing is a big confound here. But like others have said... TEST is the only real answer.

      Obviously I'd say test different prices if you can. I've heard of products that cost $30 selling the SAME AMOUNT when the offer was switched to "only two payments of $30".
      {{ DiscussionBoard.errors[3107113].message }}

Trending Topics