Are you just starting in your online business…or have
you in business for years online? It really doesn’t
matter. We all have to start somewhere…and the
majority of online entrepreneurs make a very similar
mistake.
For their first product, they create a $7 ebook…or
maybe they go way out on a limb with a $10 product.
Their concept is that with such a low price, it should be
easy to sell.
The truth is that you may or may not increase sales with
a low price. I’ve tested prices and seen $19.95 do better
than $9.95 at times. I’ve sold other products better at
$197 than they did at $47. The most important aspects
are the real value and the perceived value of the product.
Here’s the rule you have to remember:
Good marketing can never beat bad math!
If your goal is $1,000 a week, you have to sell 100 copies
of that $10 product. If you want $10,000 this month,
that’s 1,000 sales. That’s a ton of sales!
Do the math! Your goal might be to earn a million dollars
online. If you’re selling $10 items, that’s 100,000 sales.
Wow…that’s a lot of customers. If you’re selling $1,000
items, you only need 1,000 customers.
What if you were selling a $10,000 product? Now you only
need 100 sales to reach your goal. Don’t believe anyone
would buy that price? That definitely would…and do…if
you provide them with enough value.
What if you sell 10 of your $10 product this week, you make
$100. On that $1,000 product, you made $10,000. Can you
live on $100? Not likely. Can you live on $10,000 a week?
I surely hope so, or we need to take a serious look at
your lifestyle!
What about customer service? Taking care of 100,000
customers takes a large staff. You only need a fraction
of the customer service staff with 1,000 customers. In
addition, I’ve found the higher ticket customers in
general are more polite and request less refunds.
No matter what you’re selling, you still have to produce
sales copy. You still have to write Adwords ads. You
still have to create your email follow-ups. You still
have to find your affiliate partners. With the higher
ticket items, you make more money for the same effort.
Why should you even have a low ticket item? It’s a
lead generator. That’s all it is. Whenever I see a
product under $50, I immediately think lead generator
and wonder where the real profits are in the business.
The only problem left is how do you move up to higher
ticket items. The first key is to constantly look for
ways to add more value to what you’re currently offering.
In addition, look for ways to also add to perceived
value of the product (sometimes called the thud factor).
The second key is to target affluent customers instead of
those who have no money. Pick up a copy of the Robb
Report and similar magazines. Visit country clubs in
your area. Go visit higher scale stores.
I found targeting people with money very difficult at
first, because I had nothing before I started in business.
It was hard to imagine people spent $5,000 on golf
clubs, went to $25,000 marketing conferences, and paid
$250,000 for a membership to a golf club.
Yet, that’s one of the biggest changes you can make…a
change in your mindset. In most businesses, people are
willing to spend money to get what they want. And these
are some of the best customers you can ever have…if you
focus on them and deliver exactly what they’re looking for.
Terry Dean has been helping entrepreneurs get started
online for 11 years. Pick up his free report, “Instant
Profit Boosters: How to Add Real or Perceived Value to
Boost Profits and Repeat Sales” along 3 other special
reports at http://www.theterrydean.com
