Here is the manuscript for episode 11 of the podcast Success and Inner Growth. In this episode we focus on the price and value of information products.
You find all older episodes of Success and Inner Growth here.
The value and price of your information services needs careful consideration. If the price is too low, you suffer. If the price is above the value of your service for the customer, he will not buy, and you suffer again. So, this is something you must get right.
The Value of Your Information
Obviously, the value sets the upper limit for the price you can charge for anything. So, it makes sense to understand the basic elements of information value.
Information is like energy, it is everywhere. Both can be hugely valuable, and they can be a burden. Therefore, many of us suffer from information overload. This means, information can even have a negative value and a negative price. An example give those apps who offer to remove distracting advertisements for a fee. So, let’s see, what makes information valuable.
Usability of Information
The value of information has three key dimensions: The information must be relevant, connected to the customer’s life, his aspirations and his problems. But even super relevant information will not help the recipient, if he cannot trust the source. And finally, if information comes too late, it will not help. Information coming too early, on the other hand, can be a distraction. It needs to be stored and retrieved when the time has come.
If your offer sucks in one of those three dimensions, it is almost worthless, and you can get only a tiny price for it.
Relevance
To make your information relevant, you must find the people who could benefit from it, if everything else is right. Relevance is kind of an objective criterium, and the broadest description of your target market. Some people may know about their problem and your possible solution, but most of them probably don’t. Your offer is regardless of their awareness relevant to them.
Trust
After you have found a prospective customer, for whom your information would be relevant, the next hurdle turns up. You need his trust. He needs to see you as credible and your information as reliable.
Trust implies a relationship between you, the information provider, and your prospective customer. He needs to be convinced, that you
- stand by your word,
- know what you are doing
- don’t try to mislead him
It will take some time to give your prospect that confidence. But untrusted information has no value at all.
Even if you trick someone into buying your stuff, he will regret his purchase. Your product will be in the best case a dust collector, but probably your unhappy customer will share his unhappy experience with friends.
Timeliness
Trust implies, that your customer knows you. But timeliness goes the other way around. If you want to offer to your customer the right information just at the right time, you need to know him.
You need to listen to the signals he sends out to you. This is not possible without a continuous conversation at a low, non-intrusive level.
The Price of Your Information
We have now seen that the value of your information is different for different people. This leads to a dilemma: a high price locks many potential customers out, while a price too low lets you suffer and sweat for nothing.
Consequently, you can’t offer all your services to all your customers at the same terms, for the same price. You need to slice your information up, bundle the value into different products and offer the products at the right price to the right people, just when they need it.
Slicing up Your Information into Different Products
You can respond to the different levels of relevance, trust and timeliness of your prospects by slicing up your offer into different price ranges. This allows you to offer all prospects some value, and to do that without giving the house away.
Free Information Packages
You can use free information packages to create awareness in your target market, and to start building a relationship with those who raise their hand and signal their interest.
Accordingly, you need to distribute two types of free content. The first category is available to everyone, who might be interested. This includes blog posts, podcasts, social media content, YouTube videos and more.
You can post this free and ungated content on your own platform, but also on platforms you do not control. You can allow people to share it freely and encourage them to do so.
This free and ungated content helps you to create awareness about your offer, and it demonstrates to your audience that your products have substance. You can use ads to promote free and ungated content, but it is a good idea to connect each piece of free content to a lead magnet.
Lead magnets
A lead magnet is a piece of free, but gated content. People must typically sign up to an email list to get their hand on such a lead magnet.
The lead magnet allows you to start a conversation with your prospects. You offer a short piece of valuable content to people who join your mailing list. This can be a sample of your product, a checklist, a flow chart or something similar. It should be easy to use and provide ideally a quick solution for a common problem in your target market.
Once your prospect has signed up to your mailing list, you send him more content. This can be free content or offers for paid products. You will be able to see, which email a subscriber opens and which link he clicks, and with some services you will also know, which pages of your website he visits.
Low Priced Information Packages
A well-managed email list will over time allow you to know your customer better and send him the right offer at the right time.
The prospect, on the other hand, had also the opportunity to learn more about you and to develop trust into your expertise and integrity.
When that comes all together, you can offer him an information package from you as a trusted source at the right time. Such information has value, and you can ask for a price. He will be now able to pay for this package a low price, typically around 7 Dollar.
You offer this product generally through your own platform, because you want to know, who bought it. This will be often an offer for a low-priced information package like a graphic bundle, an eBook or a video course.
But you could also offer an eBook, and then add a print or Kindle version on Amazon, and an ePub version on apple books. You could then add for the people who buy on another platform links to related sources available upon registration on your platform.
After this first purchase, you move the new customer from the prospect list to the customer list.
Medium Priced Information Services
A typical medium-priced information product would be something like a reference library, or access to a database with very specific and up-to-date information.
It could be a series of books, a library of royalty free media like images, video clips or sound effects. In a B-to-B context, the medium-priced bundle could also contain publishing rights for items your customer wants to provide to his own audience.
The idea is that you provide access to highly relevant information the customer needs again and again. He will be able to access it, as he needs it.
If this information pool is updated and edited continuously, you could also ask for a monthly fee.
High Ticket Personalised Information Services
Up to this point, everything is automated. Your work is taking care of the automation system, grow it and optimise it. And, if you want to build some scale, this is quite a lot of work.
But, after you managed to build very strong credibility in your market, some customers might ask you for information services on a one-to-one basis, or at least somehow personalised.
You could offer to your best customers consulting or coaching. Such personalised service carries a very high price tag, because your time is limited.
To get to a lower price point, you could organise conferences, where you speak personally and make yourself available to high-paying participants. This could also be an online conference, mastermind sessions or even webinars with Q&A sessions.
High Priced Information Packages
If participants agree, you could also record part of such events and offer the recordings to your advanced customers. The participants may very well agree, because it is also valuable for them to let your credibility shine on them. Additionally, you could allow them to sell the recordings also to their own audience.
Episode 12
This was the manuscript for episode 11 of the podcast Success and Inner Growth. You find the manuscripts of all older episodes here.
In Episode 12 we look at ways to become more relevant to our audience, and the tradeoff between building a relationship and maintaining privacy.
Episode 12 will be ready around March 15.
