The Paradox of Price…..and the Fallacy of Free

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In this short(ish) post……, I’m going to dispel one of the MAJOR marketing myths that keeps MANY people in the perpetual poorhouse…and in MY view, one of the chief obstacles that keeps many people NOT BELIEVING they can truly succeed marketing themselves ONLINE…..or off.

The idea that you’ve got to have LOTS of free stuff to give away……to make money.

Or to attract attention, build rapport or offer genuine value you’ve got to trip all over yourself to be cheaper, more accessible and offer MORE stuff for LESS money than your nearest niche neighbor.

Or – that selling LOW priced products is a good way of getting people into your “funnel”…and by simply pricing your stuff LOW enough…….you are opening up a universe of potential buyers that would NOT be available to you if you charge what you really BELIEVE you are worth.

That the law of large numbers is the KEY to success….and that a large list ONLY emanates from the philosophy of FREE.

LET ME ASK YOU A QUESTION……….

What’s the difference between a $100 an hour lawyer….and a $400 dollar an hour lawyer?

I guess it depends on who you ask……..and SOME would take exception to this, but I’m going to tell you what it’s NOT, right now:

1. It’s NOT a 400% better understanding of the law.
2. It’s NOT a 4X better Grade Point Average in Law School…..or a 400% better Bar Exam to Boot.
3. It’s not a 400% better closing argument, either. (because $400 an hour lawyers TEND to Settle..:-)
4. Or a 400% better looking receptionist. Or Hugo Boss suit.

It’s CONFIDENCE.

And courage. And the HONEST hubris that says I’m worth more.

And MOST importantly MARKETING mojo.

And PROPER positioning.

And a CRYSTAL clear picture of who his (or her) prospects are…….with a price point (and bank account) to match.
Let me give you an example……about the FALLACY of free (and the paradox of price)

A while back I ran a very special promotion on my blog…..where, on my “THANK YOU” page after signing up, I had a “free” coaching offer.

What WAS It?

If you signed up for Lunar Pages hosting, using the link provided…..I was offering a free assessment or critique, via email only, of anything you would want me to assess, or evaluate, or look at – landing pages, blog strategy……the time was yours.
Many of you reading this right now probably remember it….as I don’t offer that sort of stuff too often.

Why did I do it?

Honestly?

I can churn those out very quickly…….and the hosting offer was a really good deal for my subscribers….AND, the affiliate company was paying me an exceptional rate, through CJ – DOUBLE in commission, what the cost was to YOU for signing up.

(the hosting might have been 60 for the year or something….and my commission, if I remember correctly, was 120 or thereabouts)

Well……guess what?

I ASSUMED (which we all know is a dangerous dance) that I would be FLOODED with emails.

After all……for a 60 dollar investment in HOSTING, you would be getting, from my vantage point, an elite level overview of your strategy, your system, your blog, your copy, or whatever it was that people were going to ask for.

A WIN/WIN across the board, right?

WRONG!!

Or at least…..it wasn’t a win for me..:-)

Why?

Because almost NO ONE signed up!

Yes, I got a few right away from my regular readers……..but after those folks, who obviously had a bit better of a handle on the kind of value I “may” be able to provide…….NEW subscribers, in seeing that offer on the THANK YOU page, pretty much ignored it completely.

Want to know the FUGLY Truth?

After the initial “rush” from my regular readers…I went like a WEEK….without a sign up.

And IRONICALLY…..this is the EXACT time that many of YOU started to check out my stuff, as a few well known IM’rs (like John G/Jennifer/PotPie Girl and other friends or partners) started to graciously, and without my soliciting it….recommend their readers sign up for my stuff, or check out a particular post, or whatever it was at the time.

So on top of my ordinary list building efforts……I was getting twice, or THRICE the amount of daily opt ins’ with new people from outside my universe coming into the fold.

Which added MORE insult to injury….as I simply couldn’t understand why people weren’t BOWED over by the value in the proposition..:-)

So one day…..I decided to make a little change…..JUST for shits and giggles.

I changed the Thank You page to my ordinary coaching and copy writing rates -which were posted at $1500 per day for a full day copy critique…..and what I called a “maniac marketing make over”

I had a whole sales page up for that…with all sorts of flattering testimonials, comments made by other people, other bloggers, marketers, copy writers……..even older off line clients whose copy I had written in what seemed like a previous life….all endeavoring to evangelize my marketing mojo to mythical, magical and ultimately exaggerated and embellished proportions..:-)

(but hey….who was I to argue..;-)

So immediately….after opt in in……THAT was the page that people started to see instead.

Want to know what happened.

No one bought.

At all.

Not a new shiny dime went through my poor Paypal pay me now button made ESPECIALLY for this premium priced offer………..BUT, this time I wasn’t’ expecting them to.

Because they had JUST opted in….and didn’t know me from Adam.

But you want to know what DID happen IMMEDIATELY?

The page “stickiness” tripled.

People started READING the page….and reading the copy….and hanging around for a long while to see what could possibly be worth $1500 per day on this very strange dude’s site they had never heard of before……BUT with the somewhat eccentric, odd and unusual approach to self aggrandizement and writing online copy.

So that was a GOOD thing, right…..curiosity may have killed the cat, but in my experience, it’s also the very FIRST step in getting ready to count your cash as well.

Then……..within 24 hours, (sometimes sooner) I would send THOSE people to the very same lunar pages hosting offer everyone else opting in ignored.

Want to know what happened?

I think you can probably guess.

The sign up percentage went THROUGH the roof.

Nothing else had changed.

But CONTRAST kicked in. And the appearance of incredible value. And scarcity. And the IMPULSE to seize opportunity.

And all of a sudden….without any real extra information, just positioned a bit differently because I said I’m WORTH $1500 A DAY….and you can get me for signing up for a $60 dollar service you MAY just need anyway…..that was the match that stoked the ferocious fire of I’ve gotta to have you…..NOW.

From ZERO to hero without changing ANYTHING at all……other than a simple shift in show and tell.

Very similar to buying my first pair of black roller skating skates in 8th grade specifically for couples skate with Penny Kramer, the girl of my dreams at the age of 13.

(NOTE: I ended up turning away MOST people who inquired from this point forward….and as many of you probably saw – X’d out the entire offer – simply because it would have taken up too much time)

Interestingly, by the way………later in life, I turned Penny down too.

But that’s an other story for another time.

So back to the copy………what did we learn?

What people see FIRST….is often very, very instructive as to what they’ll do next.

Positioning is powerful. And you CAN (and should) control your own.

And FREE is often a fallacious strategy for imparting the authentic value of what you had to offer.

My older sister, who before becoming a full time Mom was a pretty successful reality TV producer AND someone who watched WAY too much Oprah…used to ALWAYS say “You give people PERMISSION in how they are going to treat you. ”

And it’s true.

In real life, we train people – through how we see OURSELVES……in how they will invariably see us, and then act accordingly.

Its’ the very same thing here.

We DICTATE to other people what we’re worth.

Rarely do they need to decide on their own.

You can control it – you can own it – and if you’re SMARTER than me, you’ll make it count for FAR more than your competition who is begging for bucks and slowly starving his (or her) offers dry out of fear of looking foolish. Or too confident. Or too expensive. All unfounded fears that WILL leave you under-paid and making yourself SMALLER than you were intended to become.

Not convinced?

Let me give a more recent example…..

I sent out a broadcast last month, in late April……..that said, mas or menos, I’m going to be releasing some PAID IM related products – courses, ebooks, et al, in the near future.

Many of you may recall reading it, as I asked those who were interested to join a secondary, “sub-list” if you wanted to learn more.

I had a NUMBER of un subscribes after this….which I expected….and attributed more to the fact that I hadn’t mailed portions of this list in a while, and they weren’t the people who were regular readers, or a good match for my marketing methods, anyway.

But a few that I didn’t expect opted out as well….and this stung…and surprised me.

Several people wrote me somewhat “scathing” emails about the fact that I would release PREMIUM products, after giving away so much stuff for FREE over the years.

Several of these people were long time commenter’s on my blog….and always quick to compliment, praise and celebrate my content.

Some of these people I felt a true “KINSHIP” with….as I recognized their names, and their comments from several years worth of posts.

Yet……..at the mention that I would CHARGE for something going forward…….several of these eggheads decided not only to opt OUT, but to let me know how a fee based offer would denigrate all of the good will I had earned with them thus far.

Guess what?

GOOD RIDDANCE!!

Because the moment people demand FREE.…….and expect FREE….and will not TOLERATE anything that is NOT FREE…..is the moment you have a business model that’s DOOMED to fail.

(not to mention subscribers, readers and “friends” who have no genuine interest in YOUR wellbeing……but rather, ONLY what you can offer them, instead. You don’t need to be Oprah, or my big sis – to realize that AIN’T a healthy, 2 way relationship that you want to nurture)

Which brings us BACK to the PARADOX of price.

I go into this in FAR more detail with my coaching clients…….but the gist of it is here.

People tend to erroneously believe that if you charge more, you’ll sell LESS.

It’s really not true.

There are an EQUAL number of willing buyers for a $97 dollar product in YOUR niche, as there are for a $27 product…..PERIOD.

But if you position yourself as the purveyor of 27 dollar products……you’ll have a hellatious time selling stuff for $97.

The key is, to identify the RIGHT prospects for your price point BEFORE you begin acquiring your names, building your list and creating your product funnel.

Like everything else in life…..you do this by asking the RIGHT questions first.

What is your income goal per month? 3,000? 5,000?

Begin with the end in mind.

How do you REVERSE ENGINEER that number BACK down to a grass roots level of simple sales?

How many 27 dollar ebooks do you have to sell to make $5,000 this month?

A little less than 200, right?

That AIN’T gonna be easy in most markets, especially if you are just getting started.

But how many $97 dollar products do you need to sell to make that same 5 large?

Only about 50, right?

That feels MUCH more manageable….and NOT a whole lot different from an effort, exercise or input standpoint as the $27 dollar product you created initially.

(remember….it doesn’t have to be 4 times better, it simply needs to be POSITIONED properly, and geared to a much more specific audience)

BUT WAIT………If you could be really, REALLY audacious….bold, and brazen about the whole enchilada, how many $197 e-courses would you have to sell to make that very same $5,000?

Only about 25, right?

That’s NOT going to be too tough….especially if you structure your offer in such a way as it emanates SUCH intense value that at a price so low….it feels like a steal.

What if you went off the deep end completely?

What if you went ZANY, zooted, balls to the wall nut job all over yourself and decided to codify your content in such a way…that your basic $27 ebook was re-framed, re-positioned and re-created it in such a way that it now is a $497 product you are PROUD to attach your name, your reputation and your livelihood to with GLEE?

How many of THOSE would you need to sell to make that very same 5,000.

Only about 10.

And the ONLY thing that stops you from doing just that is the BELIEF that you can’t.

That you don’t have the content….or the contribution……or the creativity to make it happen.

I’m telling you that you do.

And that if you have the chutzpah to create a 27 dollar ebook……you ALSO have the cojones to create a 497 power packed product that will sell EQUALLY as well.

(but of course….you need to START by attracting a much different audience…and re framing your “funnel” in such a way as to position yourself as WORTHY that of which you ask..:-)

That’s the paradox of price……..

You CAN charge more than your competition…..and make MORE money, selling LESS, while contributing FAR more and enjoying yourself in ways you NEVER will while selling yourself SHORT in the shallow end of the pool.

Your homework assignment?

Start asking yourself better questions.

Am I offering great value?

If not….why not?

Am I charging what I’m TRULY worth?

If not….why not?

Are other people charging…and GETTING far more than I for similar offers? If so…….why? What are THEY doing different than I?

Identify the HOLES in your product pricing model…and start with what you believe you are worth.

(this is often the biggest enemy of achievement….and if I can overcome getting picked last in kickball for 2 years running in 3rd and 4th grade to develop a healthy dose of self worth, value and esteem a few decades later…….so TOO can you!)

As always…….if you’ve enjoyed the above, take ACTION on what you’ve read!

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