Product Pricing- Is it Time For a Change?

Isn’t it about time that we as Internet Marketers took our heads out of the sand and started to think like Apple arguably the worlds most successful company?

For years companies like Microsoft and Apple have charged premium prices for software, I think Windows 7 is about $119 – $219 depending on version and Mac OSX 10 Snow leopard will cost $129 as an upgrade. These prices have been justified because of the cost of producing CD’s and distribution. However since I switched to an iMac 2 months ago i’ve noticed a trend. Apple are unbundling their applications and charging much less for them if they deliver via the Mac App Store..i.e online

For example I could continue to use Microsoft office on the mac as they make a mac version it costs $279 Like all bundled apps there are parts of it I probably wont use. When I look at Apples iWork tools (the office equivalent) I get the option to buy Pages (word) for $19.99, Numbers (excel) $19.99 and Keynote (powerpoint) $19.99

On my PC I bought Camtasia for $299 but as a download from the Mac App Store Screenflow a rival product costs just $99… as does Camtasia for mac!

I watched the keynote speech from the Apple developer conference yesterday where they announced that the next Mac OS called Mac OSX Lion would cost just $29.99 and would only be available from the Online Mac Store – and you can use that 1 purchase on all the macs you have registered at the App store!!!

Now compare that to Pricing in the IM sector, the Guru’s Increase prices all the time in the past 4 years the benchmark prices seem to have been $497, $997, $1997 and now $2,997 although that last one may just have been a step too far as they seem to have stepped back to $1997.

Now answer me a question (either hypothetically or please feel free to use the comments) how many of you bought Video boss for $2000? If it had been priced at lets say $67 how many of you would have bought it? Would Andy Jenkins have made 30 times more sales? Maybe not, But I suspect he would have had far fewer refunds and a lot more buyers on his mailing lists to which he could have sold further related products.

Of course the big question is how many of his “Good Buddies” would have promoted for $30 in commission? Probably not many but on the other hand I can think of hundreds if not thousands of other marketers who would have promoted it via blogs and forums.

So where am I going with this…

Once you make a product and set it up for download whether you sell 1 copy or 1 million copies It doesn’t affect the cost on the time spent of the original product. So why not take the lead from Apple and sell it cheaply, forget $197, $67 or $57 try $17 $27 or even $7. When you sell a product at $67 you need to pile on value so that it looks like a no brainer, I do this myself by adding updates , bonuses and usually a forum.

If I was to sell the same product at $27 or even $17 I wouldn’t need to add so much value I could add the value items as further low cost items to the download page. So instead of having a forum for beyond commission and another for Video creation mastery I could offer access to 1 combined IM forum for a low monthly cost for all my products then it is in the buyers hands as to whether they want the added value or not.

Look at the Warrior Forum people sell hundreds, sometimes thousands of copies of their products at $5-$17  If they are good and get good feedback they sell if they are bad they don’t sell it’s a simple as that. Thats a market that works with low prices, my last WSO sold almost 500 copies in a few days Beyond Commission which I feel is one of my best product still hasn’t sold that many.  That begs the question which is more valuable $ in the bank or confirmed buyers on a mailing list?

 

There are 3 big problems here as I see it.

1. We don’t have something as integrated as The Mac App Store available

2. Affiliates won’t promote for $8 or $12 a sale

3. Buyers equate low cost with poor quality.

While it’s true that there isn’t something like the Mac App Store available for IM products at the moment there are alternatives, I use Digiresults to sell some of my reports cheaply it works well and it’s easy to use. It’s also growing all the time. On top of that It also helps with the affiliate problem.

I’ve found that despite what many people think the lure of instant affiliate payments is powerful and people will happily promote low cost products through Digiresults simply because they get paid instantly and don’t have to wait 3 or 4 weeks to see the results of their promotion.

In the past few days alone i’ve had someone sell 30 or so copies of one my products as I give 75% on that product he’s probably earned about $300 and I’ve maybe only made $100 ..so what!  it’s $100 more than I would have earned selling it at $47 and I have 30 new buyers who are now subscribers.

Now thats what I call Win Win

The last point will take time and education and thats where all you guys reading this come in, if you buy a low cost product and the content is good them it’s up to you to spread the word, tell people it’s good, recommend it , even promote it. Start spreading the word that low cost doesn’t mean it’s crap! It’s in your own interest as you my friends will be the beneficiaries in the long run.

I am going to start to test this with some of my products in the next few weeks I’ll take some of them remove all the bonuses zip up the videos and PDF’s and add them to Digiresults at a much lower price and see how it goes. I realize that it might annoy some people if they bought recently but I’ll sort something out. Stay tuned I’ll let you know if it works or is a total failure.

I would love your comments more than ever on this post, Am I raving mad or do I have a point, could this be the start of something or are people too entrenched in their views please let me know by commenting below.

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