Does talking money or online offer pricing send a shiver down your spine?
Figuring out the online offer pricing for services, a course, or a digital product can be a nerve-wracking part of owning a business.
I get it. Noodling on perfect pricing isn’t how most of us get our kicks. But getting it right can make landing sales happen with ease.
Get it wrong? You could end up hearing crickets when it comes to closing sales or converting at launch time. *Cue horror movie scream!*
Fear not, my shaky-footed business warrior, below are five key considerations to help you find your solid online offer pricing strategy like the digital boss you are.
Pricing Tip One: Check out the Competition
Time to put creeping on Becky to good use! Because getting your pricing right requires understanding what others are charging for similar services, courses, or products.
Start your offer plan by conducting competitor research. This will help you pump up those juicy differentiators that make you stand out against whatever Becky’s schlocking.
The key is to price your offer similarly to competitors that closely align with you. If you’re still building your empire, you need to keep that in mind.
However, if you charge too little, a kernel of doubt around legitimacy is planted in your customer’s mind. Charge too much, and you risk consistently pricing your customer right into Becky’s hands (and bank account).
Pricing Tip Two: Consider Your Audience
Selling Business-to-Business (B2B) or Business-to-Consumer (B2C) will make a big difference in how you price an offer. B2B offers target other business owners, while B2C targets your average buyer.
B2B offers can cost more because they provide a solution that increases profits, streamline operations, or provide a higher return on the investment. This is why done-for-you services that deliver a final product cost a much higher price than a self-led or DIY course.
For context, a self-led course often costs anywhere from $97 to $2997, while done-for-you services can cost upwards of $5000.
B2C products often max out at a lower threshold between $97 to $497 because the perceived value or solution is limited to a smaller aspect of the customer’s life and is less likely to help them increase their own income.
Pricing Tip 3: Weigh the Problem You’re Solving
What problem are you solving? Does your offer help someone make more money, or save a marriage? These are “heavy” problems that people will generally invest their precious moolah to solve.
(Side bar: Not sure what problem you’re solving for your clients or customers? STOP! This is one of the most important things to figure out before you spend a ton of time, effort, and money on marketing.)
Those chonky hippo-sized problems typically demand more time and energy to solve, so factor this into your pricing and how you structure the size of your solution.
This leads us to …
Pricing Tip Four: Understand Where it Lives
This step goes hand-in-hand with the weight or size of the problem.
Smaller more targeted solutions are best as an introductory offer that meet the needs of customers beginning their journey with you. Primary revenue generators or high ticket offers will often contain those hippo-squashing solutions.
If this is your first time putting your offer out into the wild, you should lower the price for a “beta launch” to your existing audience. This will help you to validate interest, incentivize purchasing at the one-time price, and begin to gather social proof from early adopters. (Not to mention, give a little price break to the folks that love ya!)
Pricing Tip Five: Stay Under a Breakpoint
You’ve crept on the competition, determined the size of your offer, and found it a home in your business structure. Woot woot! You should now have your feet more firmly planted in the right pricing path.
To finesse it to the ideal number, you can start to apply pricing psychology.
Pricing psychology is like a magician’s sleight of hand — invisibly making the magic work.
When we think about pricing, there are “breakpoints” that make a price feel significantly cheaper or steeper. Some of the most significant breakpoints for online offers are $50, $100, $300, $500, $1000, and $3000.
Let’s say you’re pricing that social media boot camp as an introductory offer. You would want to price it as low as $47 instead of something like $67. Psychologically, $47 feels significantly less expensive than $67 because it is below that $50 hump.
Keep in mind, pricing is not set in stone. If you launch your offer and it’s just not making sales, you can test out new pricing to help get those happy customers. Keep in mind, it is always easier to go up in pricing as your business flourishes than it is to slash them.
By taking the time to think through each of these five areas, you should feel more confident that your pricing is right on the money.