Pricing It Perfectly

Experimenting with pricing is one of the perks of creating your own products. A few months ago I took the leap and switched to tiered pricing (aka packages) because research says it’s the best way to get higher returns per customer. A couple months in and I can only agree more. My relaunch brought me more revenue even if it didn’t result in more customers.

Gumroad (my previous processor) even lays out the structure in a blog post:
Basic — a book (1x) (PDF, ePub and Mobi)
Complete — a book with video interviews (2.2x)
Premium — a book with video interviews, behind the scenes extras, and worksheets (5x)

If you’re reading about pricing online – this is almost considered a golden rule. Everyone does it.

I love making money. But I wouldn’t want to keep a penny of it if I didn’t earn my money by providing something that gives my customers more value than the money they’ve invested. I’m not here to trick my customers by using the most effective psychological jedi mind tricks.

I want to make money by helping you to make money. So many of these articles focuses solely on how to maximize profits without once mentioning how to provide more value. It just states “charge more”.

Here’s the very first words in Dan Mall’s excellent Pricing Design (foreword by Mike Monteiro):

You are going to make more money from this book than Dan Mall ever will. Dan is okay with that. Because that’s what Dan does for a living. He builds value. And as a designer, Dan understands that his clients will make more money from his work than he ever will, especially if he does it right. And quite honestly, that’s the key to pricing work. Understanding that the people you’re doing it for stand to bene t considerably if you do it right. And that’s why Dan charges them according to the value of the work. Because Dan makes money for people.

Dan’s book Pricing Design is a silly $8. Get it now.

Making it easy for the customer

While considering my next book and how I should price it, I’ve had a deep feeling that this complicated structure might not be the right direction. When I was buying Justin Jackson’s book, Jolt, I was relieved to see that a simpler structure can be just as successful. With Jolt, rather than having packages with extra chapters, videos, walkthroughs, mugs and t-shirts, Justin only offers two options – the book or the book with the audiobook. The book is $14.95 and if you want the audiobook that’s an extra $5. From a customer’s perspective, I think this is a far better value (knowing how few of the “extra videos” from the Premium packages I’ve ever watched).

Selling an ebook with PDF, ePub, and Mobi is like selling a monitor with HDMI, VGA, and DisplayPort cords. None of your customers will need all three but bundling them together will make it seem like they’re getting more. As a strong advocate for listening to your users and making choices that your users will benefit them most, I want to try a different approach.

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