NOTE: If you’re a brand new customer of mine – I send out a new tutorial every week about running a solopreneur business and copywriting. There will be nothing for sale this week. I just have some good-will content to share.
This week I’m talking all about rapid-fire pricing hacks that will make you a LOT more money in your business, whether you’re a solopreneur selling digital products or a freelancer.
If you missed yesterday’s tactic, go back and check it out when you can because today’s builds on it.
On to today’s…
Pricing Hack #2: My Favorite Prices For Digital Products
Let’s say you’ve found a niche where there’s lots of competition and lots of demand.
In other words, a market where lots of people are already happily paying large amounts of money to solve their problems – so it’s not hard for you to slot yourself in and take a tiny slice of that giant pie.
I’ve tested a ton of prices over the last 15 years, in a bunch of niches.
I’ve landed on a pretty rigid set of prices that work more often than not. Obviously you should test this yourself because it may be different for you and your market, but what I’m about to share has done very well for me.
I’ll also warn you, there’s a bit of witchy voodoo magic involved here.
I don’t have science for why these prices work.
And I could very well be wrong – I would love to have my mind changed on any of this.
This is simply what I’ve settled on after 15 years of being in this field and testing everything, and what has worked extremely well for me, and what I assume will work extremely well for you too.
$20 or "pay what you want": this is my favorite price for newer entrepreneurs, simply because when you’re starting out, you have no frame of reference for what’s possible – so it’s actually very hard to believe people will pay a bunch of money for your products. $20 hits the sweet spot though – customers will happily pay it without much thought, and it feels more high-value than $15 or $19 or similar prices. This is also where my first products started at. (Close runner-up: $25.)
$297: note that I skipped $99, which I think is an amazing price for recurring monthly products – but for one-off digital courses in valuable niches, I’ve consistently made MUCH more with $297 (even if it results in less overall sales). I tried $197 for a while but, again, $297 has outperformed it every time. Most people who will pay $197 will also pay $297 and not notice much difference (me included) – it’s just a glitch in human psychology and how we view prices.
$497: this has been the sweet spot for me for the past ~8 years when it comes to large, transformative, proven courses (in niches where people value courses / education / results more). My first ever multi six figure year as a digital course creator came when I bumped one of my digital products up to $497 (from $20 at first, then $127, then $297, then $497).
Students take the courses more seriously at this price point, I generally find I strike the perfect balance of "number of students" vs. "take-home profit" where I can provide world class experiences to everyone who joins while comfortably paying my bills, and overall this price point has given me my best years as a digital course creator.
$997+: when I’ve gotten into this range with a purely digital product/course, a group coaching component felt needed to justify the higher price. Personally I don’t sell products in this range anymore because a) I’m moving away from doing any kind of one-on-one or group coaching, b) I make the same profit at $497 (by selling 2x more units), and c) selling at $497 just feels more comfortable to me (I like more people having access to my courses).
I personally don’t have much input right now on the higher tier of prices beyond $997 – in general that’s where there’s a one-on-one or group coaching element and prices vary.
But the entrepreneurs I know who are operating in that space usually do best with "unconventional" and whole-number prices – like $3000 and $5700 for 3-month coaching packages.
I’ve also found there’s a lot of gray room between $297 and $497 – I know people who’ve killed it with courses at $397, so always test this.
But in my experience, anyone who pays $397 will likely pay $497 – so in general $497 will always be more profitable.
One price range I stay away from at all costs is the land between $497 and $997 – for example, $597 or $750. For whatever reason, in my experience our brains see these prices just as expensive as $997 but not as high-value – so sales have always tanked in this price range for me (every business is different though).
But there’s a chance you’re sitting there right now shaking your head, because charging prices like this just feels foreign to you – maybe even wrong.
Everything in you is resisting it, even though you know others do it just fine.
Tomorrow I want to give you a trick for charging higher prices that will overcome that resistance inside you – and make customers CHOOSE the higher prices themselves.
Talk then!
— Derek