Next, how to price special offers and bundles? For example, buy two, get one free.
Let’s say you’re selling high-resolution Nature photographs online. One tactics to increase online sales is to offer bundles. You see these in most online retailers, for example, Amazon, where you ‘buy one, get one free’ or similar bundle offerings.
The goal here is to entice the reluctant customer into buying at least one product – going through the sales lifecycle, from getting out the credit card to hitting the Buy Now button – so they understand how the shopping experience works on your sites, download at least one of your products, and hopefully feel comfortable enough to come back again.
Getting your potential customer to ‘cross the rubicon’ and get out their credit card/paypal is one of the major challenges in selling online. Bundled offerings are one way to tempt the customer to try.
When to sell bundled offerings for digital products?
- If they’re on the front-page of your online shop all the time, customers may take it for granted that they’ll be there next week and not take action.
To avoid this, consider offering special offers, such as bundled products, only at certain times, for example:
- The last Friday of every month
- Only to your email readers
- Black Friday
- National holidays, such as Christmas or Easter
- Connected to local events, for example, offer 10% of sales to a specific charity.
This may evoke goodwill on the part of the customer, especially if they know they can get the product elsewhere for the same price.
But if you agree to donate a percentage to a charity or a local cause, then maybe they’ll shop with you. Twitter is a very effective way to get the message out for these special ‘time-sensitive’ offers.
Next, let’s look at your Sales Target, the number of products you expect (need) to sell.
This is the most variable of our variables and you can play around with it based on your own numbers
Should you offer tiered pricing for your digital goods?
Tier pricing lets you price items differently for higher quantities. For example: you sell expensive cakes and you want to create a promotion where customers who buy three boxes of cakes save money compared to buying just one cake.
You can also offer a bronze, silver, and gold model, which is very effective if you’re selling membership sites or access to online courses.
Let’s say that you’re selling a product which has a standard, regular, and premium offering. For example, AgileWords.com offers this.
Using a tiered pricing system, you can offer customers are entry-level product and then, if they are pleased with this, move them up to the premium offering. However, there are a few areas to be aware of when pricing like this.
- Bronze – most customers will start here. This means you need to develop a way to upsell, ie suggest that the customer should move to the next product, after a certain amount of time. This takes some trial and error to determine when you should make this offer. If you do it too soon, it makes the customer feel uncomfortable as you probably come across as pushy. However, if you leave it too late, they may have unsubscribed or cancelled their subscription. One way to address this is to sign up with competitors and examine how and when they make upsell offers. Create a project folder on your PC and save all their materials in here, including email sales letters. You can use these for inspiration later on.
- Silver – once you have moved the customer to the mid-level product, you have at least two choices. The first is to recommend another ‘partner’ product, something that compliments but doesn’t compete when your product. Let’s say you’re selling a course about learning Latin, then you could recommend some books you’ve found useful, for example, books on grammar. Of course, you can sell them using the Amazon Associates program and make a modest affiliate fee. It all adds up.~
Note: The second option is to begin the process of moving them to the Gold product offering level. One way to ‘warm up’ the customer is to send emails (plain text emails often work the best) including interviews with other Gold level customers. Interviews are very persuasive as it gives the potential customer an opportunity to listen to someone who was probably facing the same issues as themselves. If the interview is structured correctly these fears should reduce the customer’s anxieties.
- Gold – once you have the customer at the Gold level, you have the following options. The first is to make sure they stay as a customer. You don’t want to lose them after all this hard work. So, that means finding ways to engage with them, keep in touch to see if everything is going fine (with no sales agenda), and also trying to learn from them. What do they like most from the product? What could you change? What other types of products should you develop?
Of course, you can also offer other partner products to this customer in time. The skill is to make the offer at the right time and also to keep them engaged. One tactic is to offer special offers or exclusives before they go on public sale. This makes the customer feel privileged to be in the inside track, especially if it’s a significant release.
A final suggestion is to send free, no strings attached, products to your customers as a small Thank You. Of course, you can suggest that they ‘give this a tweet’ to their Twitter friends.
Before you create your product, especially if this is the first time in digital product development, you need to know exactly who will buy it. Sounds obvious, doesn’t it?
However, what often happens is that what looks like a great opportunity to you – I bet many people would like to buy that – may not have many potential customers. And those potential customers may be hard to find.
A second problem is ego. It’s hard to let go of an idea if you’ve invested time in it. It feels part of you.
Surely, someone will but this.
Maybe, but maybe not enough to make a profit.
So, how do you verify that there is a real market with potential customers looking for this type of product?
Identify the price they pay for similar products.
Is there a demand for my product?
One way to approach this is to develop a business case for your proposed product.
In other words, imagine that you worked for a ‘real company’ and you had to convince your manager, who has to convince the Finance Dept, and so on, that there is a real, immediate demand for this product.
How would you do it?
- Creating a business case is a simple exercise in determining both to yourself and others if it should get development and marketing funding.
- Use the business case as the foundation for your marketing plan. It helps you identify the justification for the product. It also ‘proves’ to you and potential investors that a gap exists in the market and that your product will address this.
- Is there a gap in the market for my product?
Well, how do we find out?
Gap Analysis is another task which helps determine if there really is an appetite for your product as opposed to a ‘gut feeling.’ Gap Analysis looks are what currently exists in the market, what should be there, and how you can fill that gap.
Take languages for example. These are very popular. I’m learning Greek at the moment with GreekPod101.com.
The most popular languages are well served. Italian, French, Greek, Chinese, Arabic and so on.
But how about smaller, less well-known languages, for example, Gaelic Irish, or different Chinese dialects?
If everyone is competing to build the Italian, French, Greek, Chinese, Arabic products, the market is probably already saturated. Instead, look at other languages which are underserved. I’m sure you can think of two or three right now.
How to perform low-cost market research on my products?
If possible run polls on your site, ask questions in forums, perform searches on Twitter, and look at your competitors. In other words, take your own feelings out of the equation. Prove to yourself that Yes, there is a potential market for this.
April Dunford gives five great tips on how to market your web product to early adopters. She asks how can you blend marketing and product development to increase adoption, in particular by those who are likely to champion your product before it goes main-stream. Geoffrey Moore covered this in Crossing the Chasm and Inside the Tornado. Has anything changed since then?
5 Considerations when Marketing to Early Adopters
April highlights the key drivers that impact the adoption of a new product. Here are the five points she highlights:
- Complexity – you need to make it simple to understand. In one sentence. Think elevator pitch. Complex new products don’t get adopted. Marketing can’t define it, sales can’t sell it. Clarify what it does and who wants it. Make product descriptions short. Avoid buzzwords, clichés and waffle. What does it do!
- Compatibility – how does it fit in with the target customers’ product line? Support this with case studies, use cases and scenarios. Paint a picture. Help them see how it will work for them.
- Advantage – how much does the new product improve upon existing offering (or doing nothing). Express benefits in quantifiable terms. She advices not to say ‘your product is “faster” doesn’t mean as much as saying you can “improve production output by 200%.”’
- Trialability – make it easy to take for a test run. Her suggestion is to make it easy for customers to sign up and get started – you can talk about payments later. Besides downloads, you can offer screencasts, flash demos and video.
- Observability – develop outposts on Social Media sites such as Facebook, Twitter, Flickr where ‘fans’ can discuss your product and give their verdict. Be prepared these are not here to flatter you. But if you engage in the dialogue, you can discuss how your product is better value than rivals by going thru the pain points that get raised.
Others Considerations when Marketing to Early Adopters
What have we missed here? How do you get your products to market? What mistakes do people make when launching a new product?
Fire away below.
I use PayLoadz.com to sell digital products, such as Word and Excel templates. I also use Clickbank, which is in some ways simpler to use but not as feature rich as PayLoadz.com. To give an example of what I mean, here are some features to consider if you’re thinking about selling digital goods, such as MP3, ebook or audio files.