5: How to Price your Online Course

Welcome to the Course Creators MBA Podcast. I'm your host, Destiny Kopp. And in this podcast we're covering actionable tips to grow your online course business. And today we're talking about one of my favorite subjects and that's pricing your online course. And this topic is a bit controversial because of who you ask. You're going to get a wide range of answers. Also, pricing your online course is hard. You don't want to overprice because you believe that this will keep potential students from enrolling. On the other hand, you want to be sure to charge what your online course is worth. And before you start on the process of pricing your online course, I want to ask you a question. Are you willing to to confidently charge what you're worth? If you said I don't know, here are some things I want you to consider. And the first is people will really pay for higher end offers when they are positioned, packaged and marketed the right way. Also, higher prices attract premium clients, the ones that you absolutely want to work with. And there is a strong correlation between the price of your online course and its perceived value. I want you to be fully confident in what you're charging, whether that price point is $97, $297 or over 1,000. You have to be confident to ask for what you're worth and what your online course horse's worth and not to be afraid to ask for the stout. So let's jump right into step one so you can find the sweet spot for your online course pricing. And I have eight steps that I'm going to go through with you today. And step one is we're going to talk about the revenue goals for your online course and the number of course sales needed to achieve your goals. And I want you to have this number at the top of your mind as we go through this exercise. So let's assume that you need to make $10,000 per month with your online course to sustain your business and support your family. But keep in mind that the number you project here is before taxes and expenses. And this is not your take home pay. So keep that in mind. Using this number, $10,000 per month, you need around 34 core sales at $300, 20 course sales at 500 and only 10 at 1000. And these numbers also drive the number of prospects you need in your sales funnel, which we're going to talk about in a later step. So keep that in mind and write down two different or think about two different price points that you are considering. So the math or the formula for this is you're going to put down your revenue goal and then you're going to divide it by your price point. So let's just assume that your revenue goal is 10,000, the price point that you're considering or one of them is 1,000. That means that you need 10 course sales. In step two, I want you to think about and determine the value of your online course. So determine the result that your student will achieve by going through your program and how much those results mean to them. So let's assume that you're working on an online program where you help women break through the glass ceiling and move up the corporate ladder. The results that you typically get for your clients is a promotion within six months of working with you. Your clients will absolutely pay their hard earned money for results like this. If you have a course where it's harder to quantify the end result, here's what you here's what I want you to think about. If your customer tried to do this all on her own, how much time, energy and money would she need to invest? So I want you to think about the value of your online course to your student and step three is define your online course differentiators. So here I want you to think about what differentiates your online course from the competition and makes it impossible for people to steal your content, but it also increases the value. The first thing is right is more of you. So if you have bundled in group coaching, if you have bundled in office hours or maybe they get access to you via your private members only Facebook group, all of those are online. All of those are your course differentiators. In addition to this, you may have have extra bonuses that increase the value and also differentiate it. So examples here include any workbooks that you have, templates and really anything that helps you helps your students get the results faster. So think about all of your online course differentiators and put a value on them. Moving on to step four in step four I want you to review your competition. I want you to have a pulse on what your competitors are charging and how they have packaged their online program, what are they doing. And think about I don't want you to copy what they're doing. In fact, I want you to do almost the opposite. I want you to think about what you can do differently to stand out in the market. So here think about what your competition is charging and how they have packaged their program. In step five, I want you to think about how many prospects you need in your online course sales funnel. So now's the time to think about how many people you need going through, you know, your whole funnel to meet your revenue goals. And here's how you calculate that. You take the number of course sales needed, and that's from step one above, and you're going to divide that by your funnel conversion rate. Okay? And if you don't have a typical conversion rate, if you haven't been doing this for a while, you can use 3 to 5%. So let's just say that the number of course sales I need to meet my revenue goal of $10,000 a month is around 10. I would take 10 core sales divided by 5% and that gives me 200. So I would need 200 people going through my funnel to meet my revenue goals per month. The next thing I want you to do, based on everything that we've talked about thus far, I want you to determine your payment in full price. So you've considered all of your course differentiators, you've considered the value of your online program to your students, student you've talked about and did the calculations, and how many students or prospects you need going through your funnel. And you know how many prospects you have going through your funnel also drives your marketing costs, right, because you most likely will be using paid advertising to attract people into your funnel. So based on all the work you've done so far, I want you to determine your payment in full price and just write that down and then move it on to step seven. We're going to determine your payment plan price. So in this step, it's important to ensure that your payment plan price is higher, right, in total price than your pay in full price. So in other words, you want your pay in full students, right, to get a discount because they are paying you in full. And just to talk through an example on this, let's assume that your paying full price point is $999. Your payment plan price could be $99 per month for 12 months. So that gives your paying full students a discount of around, you know, $160 something dollars. I don't have a calculator in front of me, but that gives them a discount. And you really want to drive students, if you can, to the pay and full full price. Moving on to step eight. So we've gone through, we've done all the work. We know what our payment and full price is. We know what our payment price is, and that's what we're going to test. And the thing is, is it may take a few launches for you to get your pricing just right. You also need it to test the demand curve for your course. For instance, you probably won't see much a difference in sales if you price it as at $397 versus 897. Maybe you will, but you might not. So what I want you to do is you can test out a few price points until you get the one that delivers the highest amount of profit. And notice I said profit for you, not sales. And just remember, what I want to leave you with is that you can always change your price. And if you want a pricing guide to help you with this process, I have a free gift for you. You can get it on my website@destinycop.com forward slash podcast forward slash number five. I hope you enjoyed this podcast and bye for now.