The Best Price
The winner of “The best price is…”
…envelope and drum roll please…
…well…it depends.
Today is a big meeting day for me down in Denver where I’ll be spending a couple of weeks working on a big project at our www.EarlyToRise.com office. It’s going to result in a big shake-up with what we do at ETR, but it will be ALL for the better, of course!
Stay tuned.
So while I work, we’re going to hand the reins over to Jeff Schneider, our test master at ETR, as he explains how to find the BEST price for your UNIQUE info product.
PS – Do you know how to catch a unique rabbit?
Answer:
U Nique up on it.
Ha, I love that. I heard that on America’s Funniest Home videos way back in the 1990’s. Alright, over to Jeff for his thoughts on Unique Info Products. Don’t miss his lesson on how there can “be only one”.
Craig “Busy as a Unique Beaver” Ballantyne
***
“The Best Price Is…”
By Jeff Schneider
Information products are unique.
For physical products, there are relatively simple pricing formulas. Your price is about 4 times your cost. You double the price to retailer stores, they double the price to consumers.
But information is quite different.
There is no best price for information.
Some info is free.
In fact, we often tell you to solve your reader’s #1 problem with a free report to get an opt-in.
Some info is sold for hundreds of dollars.
Other information commands thousands of dollars.
But how do you know what amount is right?
It’s easier than you think. Test it.
We have tested the same product at prices between $7 and $67.
Recently, we’re tested our Home Workout Revolution program at $27 and $47. Results below…
But first, when setting up a split test, there can only be one variable.
That’s the scientific method.
You only change one variable per experiment.
And it’s best to make the experiment as extreme as possible…ie. It’s of little value to test $39 vs $39.95, especially when you don’t know the winner between $27 and $47.
All other variables must be the same. You can’t simultaneously be spit-testing the headline. So your sales copy must be the same. Traffic sources should be as close to the same as possible.
In our tests of relevance to today’s content, the only difference was the price.
We tracked two different goals – number of sales and total revenue.
Deciding the final winner is a business decision. If your objective is to get as many customers as possible so you can cross-sell future products, you may accept lower revenue on the first day.
But most often, revenue is what keeps your business afloat. That’s often where you’ll look for a winner.
Ready for the results?
Magical. Half the price, twice the sales.
So that means revenue should be about the same right?
Wrong.
In this test, the lower price still increased revenue. If we know the front-end price would be pretty much neutral, that means that buyers were more likely to take upsells.
It’s good news there’s a clear winner, but this won’t stand forever.
If we change the copy, we’ll price test again.
If we test different traffic, we’ll do the same. It’s an ongoing cycle.
There is no formula for pricing on an information product.
Testing it can provide big insights to your business.
NOTE: What worked for us is NOT guaranteed to work for you, but you can use it to guide your assumptions and testing.
That said, remember the saying that Craig likes to share:
“In God we trust. All others require data.”
Our results are not written in stone for you.
They are not even written in stone for us.
We shall come back and split test again soon.
And let you know the results,
Jeff
***
Thanks Jeff!
Back to work,
Craig Ballantyne
PS – Test yourself.
Dedicate yourself to getting better every day. Change your variables. Test what works for you. This is a lifelong project. Keep going. Keep adding value. Keep learning. Keep connecting with other good people. The breakthroughs will come. Stay strong.