An Easy Pricing Strategy For Broke Creatorpreneurs
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BEHIND THE SCENES
🤫 How We Price Our Products
Pricing digital products is a bit of a minefield. Unlike physical products, there’s no additional cost of production for each unit sold, so the cost of making the product isn’t a huge factor.
All of Creatorpreneur’s products are digital, so how do we set the price? The biggest thing we consider is something called pricing for value.
Pricing for value means pricing for what we think the product is worth rather than focusing specifically on making more money than how much it cost to produce. Instead, we focus on the potential returns that the customer can get from buying our product.
For example, the Creatorpreneur course is $799 because we believe there’s still a price to value gap. If you watch the course, actually implement the learnings, you’ll make your money back and more. Therefore, you’re still getting a great deal, which just means you're getting more in value than the price you paid.
If we set the price at $10,000, it’s likely there’d still be a price to value gap, because we think you can make a lot more than that if you follow the lessons in the course (over several years), but we’d have to work a lot harder to find the right people to buy it because it’s that much more expensive.
Pricing for value is why people like Nathan Barry can charge $169 for an e-book, and still make it look like a steal. He explains his thinking in this brilliant tweet thread.
CREATORPRENEUR INSIGHT
🧱 Increase Your Revenue With Price Anchoring & Tiers
Price anchoring is another pricing strategy, and it’s all to do with human psychology (like most of business). Creatorpreneurs need to understand this to maximise their revenue.
For the Part-Time YouTuber Academy, a product that Ali Abdaal has sold for two years, there are three price tiers. The first two, $1995 and $2995 are relatively close, and then the most expensive tier is double the middle one, at $5995.
If you were told that you could buy an online course for $1995, you might think it was a bit expensive, because you’re comparing it to what you think an online course should cost. But, if you then see another price tier of $2995, suddenly you’re comparing the $1995 to the $2995, not to the price of other random online courses you're aware of.
That’s called price anchoring. You’re creating your own context within which your customers view your prices, rather than leaving it up to their pre-conceptions. You’re anchoring your prices to each other, not to the prices of similar products.
Then, to maximise revenue, introducing a third, significantly more expensive tier creates further price anchoring to your middle product, instead of your bottom one. In this short, Alex Hormozi explains this exact philosophy.
🛠️ ACTIONABLE TAKEAWAY - 5 minute activity
You probably have something you could sell. Even if you don’t think you do, for this week’s task, you have to come up with some kind of digital product that you could sell (inspiration here), and set three price tiers for that product.
Decide which tier you want people to buy most of, and move the middle price to push people towards it. There you go, you have your first digital product 🙂
If you want to, reply to this email with your product and pricing, and we’ll try to give our thoughts.
CREATORPRENEUR DIARIES
🚀 Gareth & Tintin's Weekly Update
GARETH:
I’ve been building a personal website over the last couple of weeks, and it’s shaping up quite nicely.
There are four reasons why I thought this was a good idea (and why I think all Creatorpreneurs should do the same):
- Scalability - if we’re making videos/podcasts/tweets on a semi-regular basis, it’s really easy to repurpose that content into articles with very little effort. So, this makes our content creation super scalable.
- Audience - by having a scalable content creation process, we’re able to reach new people and they can choose how they want to engage with us too (e.g. watch vs read vs listen).
- Fun - it’s really cool to have our own space on the internet and create something that feels somewhat more personal than using other content creation platforms.
- Money - one goal for Creatorpreneurs is to make more money, so having a website makes it really easy to set up a store (https://www.gareth-evans.com/store/) and begin selling - mine is still a work in progress.
I’m doing pretty well so far - here are my stats after 30 days:
Reply if you have a personal website or if you’re thinking about building one :)
TINTIN:
Last week I mentioned I wanted to grow my Twitter. It’s been going well so far, I’ve been tweeting away with lots of useful things for creators, especially smaller creators (mainly because I am a small creator).
My content strategy recently, for Twitter and YouTube in general, is to ask myself “what things have I done that I can talk about?” It’s so simple, but there’s so much content there.
When people first start a YouTube channel, podcast or Twitter account, a lot of their content is like “why you should make stuff online” and “why making YouTube videos will make you rich.” What they’re saying isn’t wrong, but the reason it doesn’t come across very well is because they’ve only just started doing it themselves!
I was seriously guilty of this. My 4th video was called “How to Find a Niche to Grow Your Audience on YouTube” and my 8th video was called “Why Everyone Should Post Online.” I mean cmon Tintin, get real bro, you'd only just started! The content still has value, but the message just doesn’t come across well.
So now, my filter is “have I actually done this myself?” This way, unless I’m actually talking about someone else’s journey, I’m never guilty of preaching about things I haven’t experienced myself. This means the message lands better, and it also gives me so many content ideas, I just have to list all the different things I've done that might be interesting for my target audience.
If you want to feature in Creatorpreneur Diaries, share your story here.
🧰 The Creatorpreneur Toolbox
- Paddy Galloway has created a new YouTube job board to connect creators and YouTube experts.
- The DeFi Edge grew from 0-215k twitter followers in 10 months. They break down their strategy in this great thread about how to grow your audience.
- YouTube is adding channel handles which will operate in the same way as Twitter and Instagram.
- We’re experimenting with this site ScoreApp which creates quizzes to help your marketing funnels.
- $100m Offers by Alex Hormozi is one of the best books for Creatorpreneurs to read.
- Here you can download a free PDF of The Almanack of Naval Ravikant, another important book for Creatorpreneurs.
- MKBHD is a titan of YouTube with 16m subscribers. In this interview he opens up on his journey.
- RSS is a software that a lot of podcasts use to distribute across all podcast platforms.
🛠️ 🚀 Free 5 Day Creatorpreneur Crash Course
If you like these Creatorpreneur newsletters, you might like our free 5 day email crash course, where Ali Abdaal shares everything he knows about becoming a 'professional' Creatorpreneur. Over the 5 days you'll receive the tools, resources, and knowledge to kickstart your journey as a Creatorpreneur and build a scalable and sustainable business.