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Opinions sought on pricing strategy



1:17 pm on Apr 9, 2007 (gmt 0)

WebmasterWorld Senior Member farmboy is a WebmasterWorld Top Contributor of All Time 5+ Year Member Top Contributors Of The Month

I have a product that I plan to sell online. I can sell the product for $25 each doing the advertising myself and earn a fair profit.

The product can easily demand more than $25 and selling it for $25 may cost some sales to people who may think it should cost more and will be wary of a $25 price. But I can probably sell a quantity for $25 and get word of mouth sales because of the good price - good from the customer's viewpoint.

Another approach is to sell the product for $75. It could easily demand $75 based on the competition. I could then pay others, through an affiliate program or other arrangements, up to $50 per sale and still have my $25. The $50 per sale bounty would motivate others to sell for me. At $75, the price is close enough to my competitors that I would lose some sales to people who would have otherwise purchased the product for $25.

This is a digital product, delivered online, so I don't have "real world" packaging/shipping concerns.

Any thoughts or suggestions on which pricing strategy to implement will be appreciated.



2:50 pm on Apr 11, 2007 (gmt 0)

5+ Year Member

Start selling the widget at the highest price for a while. Then lower the price in steps until you reach the lowest price. Then determine at what price you earned the most money.


10:21 am on Apr 12, 2007 (gmt 0)

5+ Year Member

I would make two sites;

1) sell it for 75 (prices can/should be changed for testing)
2) sell it for 25 (and be the best offer in your niche)

The good thing of having two sites is that you can be your own competitor.


1:41 pm on Apr 12, 2007 (gmt 0)

5+ Year Member

We do a lot of price adjustments for the very reasons you've mentioned. As long as your copy is good enough to show people they are getting quality for the lower price, you'll be fine - it will improve sales. There's also nothing wrong with selling it for the price you want while letting your affiliates sell it for the price they want. For example, you sell the product for $25 (or $30 or whatever) and allow your affiliates to sell it for $75 and make $50 on the sale. I would also suggest that with your sales you start high and work your way down. That will give you the opportunity to run "monthly specials" in the future - for example drop from $40 to $25 in the month of June. This tactic works well. If you don't have a dedicated registration site that allows you to easily display different information based on referrer parameter for affiliates to truly set any price they want, then you can easily create 2 websites as suggested above - one with $25 (30,40) and one with a higher price - let the affiliates choose where they want to send the traffic - if they make a sale on the $75 site they get $50, if they make a sale on the $40 site they get $15.

Good luck


2:10 am on Apr 25, 2007 (gmt 0)

WebmasterWorld Senior Member farmboy is a WebmasterWorld Top Contributor of All Time 5+ Year Member Top Contributors Of The Month

The suggestions to use 2 sites and sell the product for 2 different prices is interesting and attractive.

How much effort should I put into making the sales page, domain name, etc. different so that it won't be easy to determine that the two are the same product?

Or should I even take the time trying to differentiate the two sites?



6:30 pm on Apr 25, 2007 (gmt 0)

10+ Year Member

I recommend split testing three or four price points, and then compare conversion rates and net profit to determine the best for you. Why guess when you can test?


6:41 pm on Apr 25, 2007 (gmt 0)

5+ Year Member

That depends on how concerned you are with developing a search engine presence and getting organic traffic. If this is a big priority take one site and make it a larger site with a good amount of content, build backlinks, etc. The other can just be a few page-strict ecomm site. If organic traffic isn't a big concern (i realize it's always a bit of a concern), then they can be almost exactly alike if you want. Either way, create one however you want and then don't spend more than a day or so creating the second one - this one you'll only use for your affiliates, direct mail campaigns, ppc campaigns, etc.

Good Luck


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