In the last post, I wrote about five psychological pricing strategies to help you sell your courses and memberships. But I realized in that post, we went off on a tangent. It was good that we did, but however, there’s an even more important point you need to understand about pricing. It’s about your target buyers. Can we get started?
No One Cares About Your Price Except You
Look, people tend to believe that you take a product, slap a price label, and customers will buy. But that’s not how it works in reality. Everyone’s out in the market with unique expectations inside their head. “Can I get a good deal for…”, “I want to buy a premium…”, “I hope my wife likes this…”, “Oh, this is too good not to buy….”, “It’s expensive, but it, after all, can help me…”, “Okay, this is the last time I’m spending money on this…”
Do you see what’s happening? Buyers don’t buy because of your price alone. They buy for many reasons. Sometimes they even try to give excuses to themselves. They are internally trying to sell the idea of your course to themselves. However funny it sounds, it’s the truth, and you might be guilty of having done this too.
Clients Are Selfish
That’s what humans are–selfish beings. That’s how our brain is wired. The ego comes to play in everything we do–including buying. “Will I get a brownie point with my spouse for buying this?” “Being a member of this community will look good on my profile…” “Wearing this expensive watch will help me look good in client meetings…” The mind-chatter is endless.
What can you do to turn this ego-driven psychological weakness in your clients into a psychological pricing play?
Seven Pricing Strategies for Courses
Below are the seven psychological pricing strategies you’ll learn in this post.
- Understand Your Buyers’ Desires
- Course and Membership Positioning
- The Scarcity Principle
- Emotional Pricing
- Behavioral Pricing
- Price Perception and Social Proof
- Personalization in Pricing
Towards the end, I’ll try and summarize your takeaways and give you an action plan. Let’s jump right in.
1. Understand Your Buyers’ Desires
Technically, I should’ve written about this first in part 1 of this post. But it wasn’t just appropriate then. Now, it’s time we spoke about this. Pricing is one of the four Ps of Marketing–the other three being product, positioning, and placement. Price is not just a number but a tool that you can use as a course creator to persuade your clients to buy your courses. But how do you persuade with just numbers?
It turns out pricing is not just about numbers. In fact, it’s not about numbers at all. It’s nothing but a reflection of the deepest desires inside your buyers’ minds. So before you start thinking of pricing for your online course or membership, find out the desires of your target buyers. I created a detailed video for you to do just that.
2. Course and Membership Positioning
Positioning is the idea of intentionally creating a specific perception in your buyers about how your course or offer will help them. While you use words to describe and position your course in a certain way, you can do it with pricing too.
Positioning your courses or memberships appropriately for different target buyer segments is crucial for successful pricing. Premium courses with higher price points might be positioned as comprehensive, in-depth learning experiences with added benefits such as personal mentoring or certification.
On the other hand, budget courses can be positioned as affordable entry points into a subject, enticing learners who are price-sensitive but still interested in exploring a particular topic. By conveying the value and uniqueness of each course offering, you cater to learners with various preferences and budgets.
Here are some ways to position your course or membership.
| Nature of Result |
|
| Personal time |
|
| Resources (people, material, etc.) |
|
3. The Scarcity Principle
“We’ve got just two more spots open…” Have you seen this used before?
The Scarcity Principle capitalizes on the fear of missing out (FOMO) and the desire for exclusive opportunities. As a course creator, you can create a sense of urgency by offering time-limited promotions or limited seats for your courses. Learners who believe they may lose the chance to enroll in your program are more likely to act quickly and secure their spot.
By strategically implementing scarcity in your pricing strategy, you can drive higher enrollment rates and motivate learners to make faster decisions, ultimately benefiting both your learners and your business.
You can constrain one of the following to introduce scarcity:
- Resources (bonuses, guarantees, etc.)
- Time (open for the next 5 hours, etc.)
4. Emotional Pricing
The phrase emotional pricing doesn’t sit well with me. In my opinion, pricing is inherently emotional. Emotion gets triggered when you prefix a number with a currency symbol. But let’s keep the phrase and consider what you need to take away from this.
Human emotions play a significant role in decision-making, including purchasing decisions. As a course creator, you can tap into your buyers’ emotions by crafting pricing strategies that resonate with them on a deeper level. Emphasize the value your courses bring regarding personal growth, skill enhancement, and career advancement.
Here are a few ways you can establish a strong emotional angle to your pricing:
- Attach the value to one of your target buyers’ basic human needs.
- Use frameworks like PAS and AIDA to start with emotion before presenting your offer and price.
- Consider using images that trigger emotions.
5. Behavioral Pricing
There’s a reason why there are sales and discounts during Christmas and Black Friday. It’s because businesses have taken a cue from consumer behavior. Behavioral economics studies how people make decisions in real-life situations. As a course creator, understanding the key concepts of behavioral economics can help you design pricing strategies that align with learners’ behavioral tendencies.
By incorporating behavioral triggers like offering a time-sensitive discount or providing a limited-time bonus, you can motivate learners to take action and enroll in your courses more quickly. Behavioral economics principles also guide you in creating payment plans that encourage commitment and reduce dropout rates.
This article by Daniel Pink discusses the 86 days of the year when you can consider running special discounts and promotions for your buyers.
6. Pricing Perception and Social Proof
Have you ever observed that full restaurants have long queues of people wanting to eat? A crowd pulls more crowd. And this goes deep into how we are social-proof beings.
That’s the same reason why social proof, such as testimonials, reviews, and success stories from previous learners, can significantly impact how potential customers perceive your course’s value. Positive social proof builds trust and credibility, making learners more comfortable investing in your offerings.
You can leverage social proof by prominently displaying testimonials and reviews on your website. Use them on their sales pages and strategically in your pricing messaging. Showcasing the experiences of satisfied learners can reinforce the worth of your courses and alleviate any price resistance.
7. Personalization in Pricing
Though a slightly advanced concept, it’s well worth its place in this post. Personalization has tremendous potential when it comes to pricing your courses. It’s used a lot in eCommerce, with platforms like Amazon using dynamic pricing for products based on individual consumers. But how can you use this for your courses?
One of the most powerful ways to personalize pricing and the offer is by getting buyers into an email list. By effectively using segmentation and tagging (supported by platforms like ConvertKit), you can create customized offers for your buyers.
Here are some personalized pricing you may want to consider if you’re just getting started:
- Special pricing for subscribers that have subscribed to your newsletter.
- Unlock special discount coupons if a subscriber has been opening your emails regularly.
- Create special, heavily discounted one-time offers for buyers who have bought at least one course.
If you haven’t engaged with your email list yet, listen to this episode where we discussed how to set up a powerful email marketing system and set up autoresponders that do the selling for you:
Your Pricing Strategy Action Plan
I hope you found this post useful. We could talk about pricing strategies a lot. But there’s no point if you can’t apply any of them for your course or membership. Here are some things I’d like you to consider as you get ready to make more money with the psychological pricing strategies you’ve learned in this post and last.
- Understand and document the mass desires in your market first. Here’s a video to help you with that.
- Get started with an email list if you don’t have one. Here’s a link to signup with ConvertKit for free.
- Put together a robust email autoresponder sequence. Listen to this podcast episode and download the free workbook.
- Pick one of these strategies and implement it for your chosen offer.
- Sign up for the Paid Course Creator newsletter. It’s free.
Closing Thoughts
Thought #1
Cognitive biases are inherent shortcuts in human thinking that can sometimes lead to irrational decisions. As a course creator, you must be aware of these biases and utilize them to your advantage in your pricing strategy.
By addressing negative biases and emphasizing the positive aspects of your courses, you can help clients overcome any hesitations they might have about the price. Additionally, you can leverage positive biases to highlight unique features that set your courses apart from competitors, boosting their perceived value.
Thought #2
While psychological pricing can be potent, please use it ethically and transparently. Balancing persuasion and honesty is crucial to building long-term relationships with clients. Stay away from deceptive practices and ensure that the value you promise in your pricing aligns with the value clients receive from your courses.
Transparency in pricing strategies builds trust and credibility and helps you build long-term success as a course creator.
Thought #3
Test, test, test. No price is the right price.
Should your price end with 7 or 9? Test.
Should you charge $99 or $299? Test.
A/B testing is a great place to begin. A/B testing involves comparing two different versions of a pricing strategy to determine which one performs better. As a course creator, conducting A/B tests can help you optimize your pricing and identify the most effective strategies for conversion.
Test different price points, pricing structures, or promotional offers to understand what resonates best with your target buyers. You can achieve sustainable growth and maximize your course revenue only by continually iterating and refining your pricing strategy based on data-driven insights.
Thought #4
While you test, don’t forget upselling and cross-selling.
Upselling is the practice of encouraging customers to purchase a higher-priced item than they initially intended, while cross-selling involves offering additional products or services complementary to the initial purchase. You can use upselling and cross-selling techniques to increase your revenue per client.
You can strategically present relevant upsell opportunities to guide clients toward more comprehensive courses or supplementary materials. Cross-selling related courses can enhance the overall learning experience and encourage learners to invest in additional learning resources.
Thought #5
Don’t forget to use other visual elements to help your pricing strategy. Countdown timers, pricing tables, and banners play a key role in psychological pricing. And make sure the rest of your marketing–email, content, partnerships, etc. aligns with your pricing strategy.
Harnessing the power of psychological pricing can be a game-changer for your course business. It can help you get a competitive advantage and stand out in a crowded market. I hope you found this post useful. Leave a comment and let me know your thoughts or how this helped you.
To your prosperity,
Kartvee