Unless you’re very cool — which I’m not — pricing matters.
The right price will help you:
Sell more
Sell to the right clients (you don’t want bad reviews and refunds, right?)
Make the optimum profit per unit
Stand out in a crowded market
Most online entrepreneurs don’t think twice about their pricing. Among the few who consider it, most will listen to advice that’s not right for them.
“Price your program high and people will believe it’s good.”
“Match what others are charging because that’s what they expect.”
“Be cheaper because not even The New York Times charges that for their subscription.”
So. Which is it?
You can take my one-question pricing survey here, and then I’ll tell you how to create your own. The answers are anonymous.
Find the best price (for anything)
In this newsletter:
People aren’t idiots.
Basic pricing principles for your online business.
My favourite pricing method and how to use it. For paid subscribers only.
People aren’t idiots.
I want to talk a little bit about expensive programs — 4–5 figures.
As a copywriter, I work with a lot of clients who come to me with a $2K course and want me to write copy that will magically make it fly off the shelves.
Even when they’re very knowledgeable in their subject, they usually are:
Online nobodies. They don’t exist on social media or any platform.
Have small e-mail lists. I’m talking 100 people or less.
If they have created some content, it’s low quality. AI articles and weird videos that provide no value.
Have no website or their website looks like shit.
I’m not saying they don’t offer value. Sometimes they come with a lot of corporate experience, education, or even an award no one has ever heard of.
I’m saying that if you want to sell an expensive program, you need to put in the work.
Because, no, price isn’t the only thing people use to judge the quality of your product.
And while it’s true that clients willing to pay more are better clients to work with, it doesn’t mean they’re stupid about spending their money.
If you want to sell premium programs and services, you need to work to build online credibility & understand marketing.
Basic pricing principles all solopreneurs should know.
The 3 offers.
I’ll keep reminding you about this forever. Every solopreneur needs 3 offers to make the maximum of their business:
Your low-cost or free offer keeps clients coming through the door.
Your average-priced offer is where you’ll make the most money. It needs to pack a lot of value in a scalable way.
Your premium offer is for your biggest fans who like how you do things and want to learn from you, not from anyone else. It’s not the big money-maker, as it requires more time and devotion, and isn’t scalable.
Make sure these offers are priced accordingly, especially your second offer.
Who are you targeting demographically?
If you’re targeting over 40s who don’t exercise, you can develop more complex products and expect to sell them well. Over 40s are typically in a good position, financially.
If you’re targeting people in their 20s who are looking for their first job, you need to consider this when creating your average-priced offer.
How aware are your clients?
The 5 stages of awareness is a copywriting framework popularized by Eugene Schwartz in his 1966 book Breakthrough Advertising.
Knowing the first 3 is useful for every solopreneur, not just copywriters.
The first 3 stages of awareness are:
Unaware. Clients don’t know they have a problem or don’t care if they have it.
Problem aware. Clients know they have a problem and are trying to find solutions. At first, we all try to find low-cost or free solutions, right?
Solution aware. Clients are aware of the available solutions. They’ve tried low-cost solutions but didn’t get the results they wanted, so they’re researching all available options. They’re ready to pay more for something they believe will work.
Again, design your business accordingly. If you’re talking to unaware clients, you’ll need to spend more time creating free content to educate them on why they need what you sell.
If you do this right:
My favourite pricing method.
For context, the most popular pricing methods used by big businesses are:
These aren’t pricing strategies like Price Skimming or Cost Plus Pricing. These are research models that give you a number to use.
If you’re interested, you can read more about each method by clicking the links above. For now, I want to focus on the Gabor Granger Method, which is my favourite.
The Gabor-Granger method is a pricing technique that involves:
Surveying Participants: People are asked if they would buy a product at various price points. For example, refer to my poll question in the beginning.
Analyzing Responses: The data shows how many would purchase at each price.
Creating a Demand Curve: This curve displays how demand changes with price.
Determining Optimal Price: The price that maximizes sales or revenue is identified.
This is simple and easy to use as long as you have an audience.
If you answered my survey at the top, you saw exactly how you can put that into practice. (And on how to create an insert a survey in your newsletter, you can learn how to do that here.)
Consider using this for your second and third types of offers to ensure you:
Price them so people will buy them
Price them so you maximize your profits
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