Digital product sellers and course creators go about pricing all wrong.
We talk about the features and the benefits and then want to know, “How much can I sell this for?”
Can you imagine a sewing machine manufacturer approaching pricing that way? Of course not. Makers of physical goods use costs and desired profit margins to drive pricing decisions, and so should digital product sellers.
First, you must understand what it costs you to create and sell a product. Consider what you spend on your team, what you spend to host your product, and how much you pay in fees just to make the sale. Then ask yourself how much profit do you want to earn from your product.
Once you have a number in mind, then you can ask, “Can I sell this for that price? Is it a price my audience will expect and happily pay, or will they think it’s too high (or too low)?”
From there, you can adjust.
If the price you want to charge is too low—meaning your audience will struggle to find value in it—bump up the price and enjoy the higher profits.
If the price you want to charge is too high for the market, how can you reduce your costs? Can you lower your profit margin but increase unit sales to make up the difference?
Watch the video to see how this pricing strategy can work in your business.
Get the calculator here. (Click File/Make a Copy to copy into your Google Drive for editing.)