If you are struggling with how to find the right pricing model for your membership website, then this presentation will help.
It provides a framework that you can use to set membership pricing levels at a premium; helping you increase your revenue and profit margins.
This presentation is the companion piece to the Pricing Podcast episode from MembersOnly.fm.
Dhanuka Agritech Limited - Sales and Marketing Intern
How to optimize the pricing of your membership website.
1. How to optimize the pricing
of your membership site
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2. Rule #1
You are in control of your pricing
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3. Step #1
Determine the “cost” of your site
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4. Cost vs Expenses
Costs…
Credit Cards Fees
Customer Support
Hosting
Contribution Time
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Expenses…
Marketing & Ads
Affiliate Commissions
Development
Rent & Internet & Other
5. Your “costs” should be
10%-25% of total revenue
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6. Step #2
Find your Target Revenue
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7. Revenue Targets
$ Costs / % Total = Target Revenue
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10% 25%
Revenue $1,000,000 $400,000
Costs $100,000 $100,000
Gross Profit $900,000 $300,000
Profit before you
pay expenses
8. Step #3
Create an Anchor Product
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9. What is an Anchor Product?
The Ultimate Offer You Provide
Very expensive
Highly exclusive
Includes everything and more
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10. Step #4
Create a low & mid priced offer
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11. Low & Mid Offers
Based on your Anchor Price
Includes some of the anchor features
Meets basic wants/goals of the customer
Low Price = 10% - 25% of anchor price
Mid Price = 30% - 49% of anchor price
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A basic
guide…
12. Step #5
Find the number of subscribers
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13. First, find your average price
Your average purchase price is…
The price between your mid & low price.
So if your mid price is $47/month and
your low is $27/month, then
your average price is $37 / month.
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14. Based on your average…
Divide your target monthly revenue by
the average price.
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15. Subscriber Projections
For example…
If your target is $33,333 per month in revenue and your
average price is $37/month, then
your subscriber projection is 900.
( $33,333 / $37 = 900 )
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16. Step #6
Review your costs, one more time.
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17. Based on the projected subscribers, can
your costs cover that number?
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18. For example, can you support 900
subscribers based on a cost of $100,000
per year?
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19. Yes!
Then you are good to go.
No!
Then increase your price or lower your costs.
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20. How you present your pricing
matters, a lot.
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21. The higher the price, the more
important the design.
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22. Emotions matter more than
than the price of features.
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23. Is your price high enough to
offer a discount?
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24. And one more thing…
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