Why Sell It at $50 When You Can Get $5000
If you have some basic knowledge of online marketing, the formula I'm outlining here will sound familiar to you. You, the expert, offer a free article, e-book or video. We call it a lead magnet. The taker pays for the item with their name and email address. They must opt-in to get it.
You do that so people, most likely people that don't know you yet, volunteer that they're interested in what you have to offer. You get their email address so you can send them a series of follow up messages. You can also pixel them so you can re-target them with ads on Facebook and other ad networks.
The next step is you get them to buy something. You typically price this under $50 and even as low as $7. We call this a tripwire. That's another step down your sales pipeline or funnel which is aimed at getting them to buy your higher-priced, more profitable item. This is what you most want to sell them.
There’s nothing wrong with the model. It's worked for a lot of people. But let's review what a consultant, coach, trainer or speaker, you the expert, is doing before they go online to see why this might be a mistake.
You, the expert, are selling higher end services. You rely on your expertise. People recognize what you know and hire you to solve their problem. You typically sell your services over the phone or in person. The time and effort this takes is worth it because of your price point. You start at $5,000 going up into the tens of thousands. It's justified.
To deliver services, you travel to client locations or meet via Skype or GoToMeeting sessions. What is key here is you rely on your expertise. Your clients need your knowledge, skill and talent and they recognize it. They gladly refer you to the people they know and care for and they come to depend on the services you provide.
When an expert decides to go online, they often forget that this is a next step in their existing business. It is NOT like they are starting a new, unrelated business venture. They should expand upon the same marketing and sales efforts that has made them successful to date. It should be an offering that addresses the same issues you address for your existing customers.
If an expert is currently successful, they likely have a lot of satisfied customers. They also have a tribe of followers that would consider doing business with them at a lower price point. It's this untapped community of followers that can be easily targeted and it's a matter of addressing the current obstacles or objections that are keeping them away.
If that's the case, offering lead magnet as I describe above is NOT the place to start. Keep in mind that this first approach is best for introducing you to people who don't know you yet. This target I point out already knows you. So an alternative online offering can be a less expensive version of your current best offer.
Let's say you offer $10,000 to $15,000 engagements. There may be a good number of potential customers that want to work with you at a $5,000 to $8,000 price point. If you offered them something equivalent to your current offering using an online group coaching format, you may get the bite. Offering a payment plan may also help bring them over.
The systems you need to make this work aren't as complicated as you might think. The content and teaching materials you rely on are the same as what works today in your business. If you have PowerPoint decks or presentation materials that go with your programs, that's the place to start. If you have a lot of content as part of working with your clients, that can likely be re-purposed to work in an online format.
The biggest benefit of an approach like this versus a $50 tripwire offer is that it's easier to generate revenue to pay for your marketing efforts. You have a producing system that enables you to hire the online marketing talent to make use of the best strategies and tactics available. With a$50 tripwire, you have to sell 100 items to make $5,000. You have to sell 200 to make $10,000. At a $5,000 price, four sales already gets you to $20,000. You can then reinvest that money to improve this sales funnel.
In the next article in this series, I'll be going over models for offering online alternatives to your business that:
- require less time to deliver services,
- provide you with opportunities for scaling your business and
- enable you to offer it profitably at a lower price than you have today.