When it comes to pricing your online offers, there’s no one-size-fits-all approach. Setting the right price for your products or services is a delicate balance that involves understanding the value you provide, analyzing your costs, assessing your competition, and even delving into the psychology of pricing. Let’s dive right into some pricing strategies that actually make sales!
Pricing can be a vulnerable aspect of your business. It’s natural to feel a bit uneasy about it, but it’s crucial to recognize your worth! The best place to start is by calculating all the costs associated with creating and delivering your product or service. This includes production costs, overhead, marketing expenses, and your desired profit margin. This method ensures you cover your expenses while allowing you to set a reasonable profit goal.
Your offerings have intrinsic value, and your pricing should reflect that! Value-based pricing is determined by what your audience perceives as the value of your product or service. You can find that out by asking yourself questions like, “What unique benefits does my offering provide?” and “Can customers find a comparable solution elsewhere?” You’ve worked hard to get to where you are, so don’t hesitate to charge what your value is truly worth! Your customers will pay for the results and benefits they receive.
Understanding your competitor’s offerings and what they charge is an essential part of pricing your offer. Conduct thorough market research to see how your intended pricing compares to theirs. Consider what sets you apart from the competition. Do you offer additional features, better quality, or a unique customer experience? Your pricing should always reflect these differentiators. Be competitive, but don’t undervalue yourself!
The psychology of pricing plays a significant role in how customers perceive value. Small adjustments in pricing can make a big difference. For instance, pricing a product at $9.99 instead of $10 can create the perception that it’s a more budget-friendly option. Experiment with pricing to see how it influences consumer behavior. Sometimes, a slight price reduction or a well-placed discount can boost sales.
Consider Your Business Goals
This part is really important. Your pricing strategy needs to align with your business goals. For example, if your aim is to achieve $5,000 in monthly sales, you’ll need a well-defined sales strategy and marketing plan to help you reach that milestone. A great exercise could be taking your revenue goal and understanding how many sales you need to get there! Here’s an example.
|# of Sales Required
|Digital good (e-book, recipes, mini courses, etc)
|12-week 1:1 Coaching Program
If you are just starting your online business or social media community it probably is NOT realistic to make 100 sales each month, even at a lower price point of $50. This is why we’d rather have new businesses focus on higher sales price 1:1 programs as the number of sales required are much more realistic – in particular if you don’t have a huge social following which is the reality for most. Not to mention that selling that $50 e-book often takes the SAME amount of effort as selling your $1,000-2,000 program! Seriously it’s true!
Feel like you’re getting the hang of it but want support finding the perfect price for your product? Are you looking for support in this area? Apply for OEA and we’ll unpack our pricing strategy in an easy and accessible way that will have your clients ready to pull out their credit card. See you inside!
This is DAY 8 of the 12 DAYS OF BLOGMAS! I know that December can be a hard time to find traction in building your business – but I’m here to help you with ideas and support as we close out 2023 and look forward to the future that you can create for yourself in 2024!
Stay tuned for daily entrepreneurship blogs we know you’ll love each weekday between now and Christmas. Don’t worry, if you missed a day you can find it in my 12 DAYS OF BLOGMAS recap here!
And if you’re ready to make 2024 your best year yet I will be waiting for you inside my Online Entrepreneur Academy START and SCALE Programs – both kicking off on January 23, 2024! Woohoo!
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