How to find the right price point for your product

Hey, everyone. I keep getting questions about pricing experiments, viability experiments, and testing business ideas. So I thought I'd make a quick video for you going through some examples just to give you a feel for how people go about testing through pricing. Because I feel like there's a lot of anxiety there, but there doesn't need to be because you can really test your way through this. So I'm going to use an example from a lightly branded corporate experiment from First Build, which is part of GE Appliances, which is a nugget ice maker called Opal. Now, you notice you can pick up on a couple things right away on their websites. First off is they were doing search search trend analysis. So if you look at people, literally, they say, have Googled nugget ice maker for home. Okay? So you can do search trend analysis to start beginning to understand pricing and what people are willing to pay or what they're looking to pay. And you'll notice here the price point was 2 to 3,000 US dollars, which, which people were complaining about on discussion forums and in customer interviews about this is just too much to pay for this kind of ice that I really like at home. I don't want to go to a restaurant always to get it. I want to have it at home. And this is just too much to pay. So you can start to find out if there's a white space there for you to play in with your pricing. Now then another experiment they did, which I thought was brilliant, was they use Indiegogo to do a crowdfunding campaign. Now, if you look, it was wildly successful, okay? But if you scroll down a bit, you can see how they set their pricing options. And you'll notice they were essentially testing pricing here, okay? So they knew people were not going to pay two to three grand for a nugget ice maker, but would people pay US$399? And you'll notice there's little text there about how they're giving them $100 off and that soon it's going to be US$499. And you'll notice they had over 15,000, 1500 of these claimed, and it was wildly successful. And so that's another way that you can test pricing is with regards to crowdfunding campaigns. Now, those are early adopters. And in the meantime, if you pulled up their website at the time, they were also testing a price point of US$429 for pre order. Okay. And so you can test different price points this way. This is separate, which is on their landing page at the time. And then after the success of their pricing experiments, you know, they basically brought it on brand and you'll notice the price point is increased here, US$476 at I made this video. They have since gone on to make second generation of this device because it's so successful and that one's even more expensive. But when you're thinking about testing pricing, don't get too caught up in all the anxiety about it. All your early adopters, right, the people that have the problem are aware, they're actively seeking a solution. They're going to pay a specific price point. But when you go more mainstream, you do have the opportunity to test different price points on landing pages on different sites. So basically I want to give you some frame of reference here of yeah, you can do this. You're probably going to use different experiments to figure it out along the way. So good luck. Hope this helps.