maximizes revenue<\/em>. Sure, you can sell your ebook for 10\u00a2 and theoretically reach the widest possible audience. But if you could charge three times the price, and still retain half your audience, wouldn\u2019t that make more sense?<\/p>\nIdeally you\u2019re doing this to turn a profit, which isn\u2019t necessarily the same as generating as much revenue as possible. You also need to factor in your expenses. Otherwise, this is just a pastime or a vanity project. Creating products certainly requires time, and possibly requires materials.<\/p>\n
That means that before you sell your first unit, you\u2019ll already have spent money that you\u2019ll need to recoup.<\/p>\n
Say you\u2019ve spent 30 hours writing a plan for a coaching program you plan to sell via your blog. Is $20 an hour a fair assessment of your worth? (That is, could you have earned that much doing something else?) Then you\u2019ll need to sell a single copy for $600. Or two for $300 each. Or three for $200. Or\u2026<\/p>\n
You can see where this is going. It\u2019s tempting to lower the price as much as possible, in the hopes that every reduction will attract more buyers. That\u2019s largely true, but a) the relationship isn\u2019t linear and b) there\u2019s a limit\u2014otherwise, you could give your product away and an infinite number of people would use it.<\/p>\n
Finding the balance<\/h2>\n
How many unique visitors do you have? If you don\u2019t know, Google Analytics can give you an idea. What proportion of those are invested in your blog and read it regularly? And what proportion of those<\/em> will cough up a few minutes\u2019 worth of wages in exchange for the promise of you enriching their lives somehow?<\/p>\nOn the flip-side are blogging entrepreneurs who charge too much<\/em> for their services. They\u2019re like the commission salesman who wanted to get a job at Northrop Grumman, selling B-2 Spirit heavy bombers at $1 billion apiece. (\u201cPeople have been slamming doors in my face all week, but I get 10% of each sale. And all it takes is one.\u201d)<\/p>\nTo avoid this, you need to find a comfortable medium between how much you\u2019re willing to accept, and how much your product can realistically benefit its user. That sounds obvious, but most sellers don\u2019t even bother weighing those variables. They just conjure up a price and hope for the best.<\/p>\n
What does your product do \u2026 for whom?<\/h3>\n
Be honest with what your product can do. It won\u2019t make the blind walk and the lame see. But will it show readers how to declutter their lives once and for all? Can it teach them how to change their car\u2019s oil and tires themselves, instead of relying on costly technicians? Can it help readers travel to strange places inexpensively, and does it include an appendix that will teach those readers how to keep their cross-border hassles to a minimum?<\/p>\n
Then say so<\/em>. You don\u2019t have to work miracles. You just have to make some aspect of your readers\u2019 lives easier, less complicated and\/or more fulfilling.<\/p>\nMore to the point, remember who you\u2019re selling to: your readers, not yourself. No one cares how much asbestos you inhaled in the mine, they just want the diamond. It\u2019s a cardinal rule of civilization that results count, not effort.<\/p>\n
One famous globetrotting blogger has recently diversified, and now sells a guide that ostensibly tells artists how they can throw off the shackles of poverty and start making money. He\u2019s certainly appealing to his clientele\u2019s emotions\u2014what\u2019s a more accurate stereotype than that of the starving artist?<\/p>\n
Never mind that this blogger is not an artist, and that his background consists of little more than that educational punchline, a sociology degree. His blog\u2019s sales pitch details how many painstaking hours he spent writing how many words and conducting how many minutes of interviews in the creation of his guide, as if any of that matters to an artist who just wants to know how to locate buyers for her decoupage and frescoes.<\/p>\n
Keep scrolling down and you\u2019ll find out that for just $39, you\u2019ll receive \u201c15,000 words of excellent content\u201d. No one buys this kind of thing by volume. Xavier Herbert\u2019s Poor Fellow My Country<\/em> runs over 850,000 words. That\u2019s 90 times longer than Richard Bach\u2019s Jonathan Livingston Seagull<\/em>, which sold far more copies and was far more influential.<\/p>\nDon\u2019t hide your price!<\/h2>\n
That brings us to another thing not to do: treat the price as fine print. Which is to say, don\u2019t build to a crescendo and make your readers sift through paragraph upon paragraph of hard sales copy before finally deigning to tell them how much your product is going to cost them. To do so is insulting. It\u2019s the tactic of someone who has something to hide.<\/p>\n
(There\u2019s one exception to this rule. That\u2019s when you\u2019re using the late-night infomercial strategy, saving the price of your product until the very end because it\u2019s so shockingly low<\/em>. That almost certainly doesn\u2019t apply in your case. You\u2019re not an experienced marketer with a reputation, hawking indestructible knives and superabsorbent towels that suck up ten times their weight in liquid. You\u2019re a blogger looking to turn your followers from loyal readers into paying customers.)<\/p>\nGetting back to the real blogger in our example, if you spend another $19 on the deluxe version, he\u2019ll throw in three more audio interviews. There\u2019s nothing quantifiable here, just a collection of messages that differ by media. (Incidentally, I asked this blogger how what kind of volume he does. I wasn\u2019t expecting an answer and didn\u2019t receive one, but it was important to make an effort to see if his methods worked.)<\/p>\n
Given the choice, I\u2019d rather take my chances giving my money to a blogger with authority and experience, who\u2019s offering me something believable, and who\u2019s not afraid to tell me how much it\u2019ll cost me and how much it\u2019ll benefit me. Is that you?<\/p>\n
One more thing. If you\u2019re creating a series of products in which each builds on the previous ones and no individual product can stand alone, you\u2019re putting yourself in a fantastic position. You can give away the first and then start charging with the second. If you do, that\u2019ll give you an accurate gauge of how many people are legitimately interested in your product, as opposed to just being curious.<\/p>\n
Accounting for expenses<\/h2>\n
Once you make the decision to sell, and to price, you\u2019ll have to account for expenses you\u2019d never imagined. Maybe you\u2019ll need to move from a shared host to a dedicated one. Or pay for a business license in your home jurisdiction. Or hire a graphic designer after concluding that your own Adobe Illustrator skills are wanting. A few hours of planning and estimation now can save you weeks of frustration down the road.<\/p>\n
Speaking of quantifying, here\u2019s a sample budget<\/a> (in PDF) that you can adapt for your own use. Be conservative with your revenue estimates, liberal with your expense estimates, and you can get a better handle on how much you should charge when your products finally make it to market.<\/p>\nYou might also find the formula presented in The Dark Art of Product Pricing<\/a> useful. It integrates many of the considerations I\u2019ve outlined here but, like this post, that one can\u2019t definitively tell you what you should charge either. Ultimately, that\u2019s up to you.<\/p>\nKey points<\/h2>\n\n- Cover your expenses. Don\u2019t set your prices so low that you\u2019re losing money on every sale.<\/li>\n
- Don\u2019t set your prices so high that you need to camouflage them, either. Be direct.<\/li>\n
- Honestly assess what your product can do for your customers.<\/li>\n
- Explain to your customers what they\u2019ll get for their money.<\/li>\n
- Like anything else, first plan, then<\/em> execute.<\/li>\n<\/ul>\n
Next week, we\u2019ll discuss how to increase your potential clientele beyond its traditional bounds.<\/p>\n
Greg McFarlane is an advertising copywriter who lives in Las Vegas. He recently wrote\u00a0<\/em>Control Your Cash: Making Money Make Sense<\/em>, a financial primer for people in their 20s and 30s who know nothing about money. You can buy the book<\/em>\u00a0here<\/span><\/em>\u00a0(physical) or<\/em>\u00a0<\/em>here<\/a><\/em>\u00a0<\/em>(Kindle) and reach Greg at\u00a0[email\u00a0protected]<\/span><\/a>.<\/em><\/p>\n\t\t\t<\/div>\n
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