The content you send out into the world has immense value. You help your followers solve problems, provide them with entertainment, and give them a sense of community. You recognize your hard work is worth something, but deciding the dollar value of your content isn’t an easy puzzle to solve. This week’s newsletter is about finding the right numbers for your business, why you should choose a tiered pricing model, and how your brand can empower your profits. Let’s go!
In this week’s issue 📨
- Develop your pricing strategy
- The benefits of tiered subscriptions
- Your brand’s pricing power
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Price is right
Establishing what your content is worth can be a mysterious process. Do you copy everyone else’s prices? Why do some publishers charge 10x the amount? How do businesses with low prices survive? There’s no magic formula for pricing your products, but there are simple ways to find the correct numbers, and it starts with looking inward instead of only worrying about what everyone else is doing.
Let’s examine some advanced pricing strategies for your subscription business to help you recognize the right rates.
Get started
- The best way to begin is to keep your pricing as simple as possible by offering only one monthly or yearly option. You should also set your price immediately, even if you’re not 100% sold. One way to know how much people are willing to pay for your content is to give them the option to pay you.
- When trying out your first price points, start higher than you think. With premium prices, fewer customers are needed, and you’ll see higher margins and gain more resources to reinvest. It’s also easier to test lower prices using discounts rather than surprising your audience with rate hikes.
- Knowing your target audience and defining your ideal customer helps you brainstorm the best pricing approach. Your readers are real people, so your pricing should always be realistic. Once you understand “Who?”, you can answer “How much?” and go from there.
- Try to put yourself in your customers’ shoes. A full-time student with only a part-time or entry-level job won’t have the money for a hundred-dollar subscription. At the other end of the spectrum, a high-level professional late into their career should be able to justify much more than $10 a month.
Product with a purpose
- Another way to determine who’s paying for your content is to examine what kind of product you provide. Is your publication supplying a service people desperately need, or is it something people casually consume? Breaking down your customers’ wants vs needs will help you decide on price.
- Some broad content categories that most publications align with are news, health, entertainment, and business. If you run an entertainment blog, this may limit your pricing. If you manage a news publication, you may be able to charge a higher premium.
Other publishers
- When comparing yourself to other blogging businesses, it’s wise to understand why they’ve priced their subscriptions the way they have and why people are paying for their content. This will allow you to develop your own unique pricing strategy instead of just mirroring what they’ve done.
- Keep in mind that content creators who connect with the same audience as you aren’t necessarily your competition. Most online spaces and niches can feature everyone’s distinctive voices, so there’s no need to be combative. This outlook will also help you network with other publishers.
Your content strategy
- How you showcase and provide content to your readers will help you determine how your pricing should work. If your posts are behind a paywall, promoting a single price for access is easy to understand, and the value proposition is obvious: If they pay for it, they can read it.
- You can also consider publicizing your content and monetizing through tips and donations. This successful pricing model allows your followers to pay what they can. Some will only be able to pay a small amount, while others will be able to show their support in a heftier way.
- If you regularly add and keep new paid members, and meet your publication goals (covering expenses, hiring freelancers, going full-time, etc.), you’re on the right track. If you’re underperforming, it’s time to experiment with price a bit more.
- You’ll know you’ve cracked the pricing code when readers positively respond to your content, like becoming a paid member, engaging with your sponsors, or purchasing your merchandise. Keep doing what you’re doing, but don’t be afraid to switch things up if your bottom lines start to flatten.
Interesting stories & ideas 📚
- Communities for creative entrepreneurs – Lex Roman
- Blank page syndrome – Animalz
- You can’t innovate away loneliness – Embedded
- Authentic is dead – A Smart Bear
- The secret to successful subscriptions – Media Makers Meet
Tiers of joy
When it comes to transactional relationships, it’s best to keep things uncomplicated. That’s why one of the most popular pricing models in the newsletter industry is tiered pricing. Whether you’re a blogger having a hard time deciding what to charge or a reader looking for a wider range of subscription choices, tiered pricing is always the safest bet.
Brent Barnhart at Baremetrics breaks down why packaging your service into tiers has been so successful for revenue and customer happiness.
#1 Tiered pricing allows you to tailor your subscriptions to a wider range of customers. Offering plans that appeal to various budgets enables you to catch both small and large ticket subscribers.
#2 Tiered pricing is easy to understand for small subscribers and big businesses, and it’s one of the most recognizable pricing models. The less confusion around your fees, the higher your member count.
#3 Tiered pricing lets subscribers upgrade their plans naturally as their needs change and your business grows. The more problems you solve for your members, the more likely they are to further invest in your content.
#4 Tiered pricing clearly describes every benefit your subscribers will receive when they sign up. Setting expectations at the beginning of the purchasing process increases customer happiness in the long term.
#5 Tiered pricing keeps things simple by focusing on only 3-4 plan options. Too many plans can cause customer confusion, tempting them to back out of signing up. When in doubt, less is always more.
#6 Tiered pricing helps you emphasize flexibility between different tiers. Your members probably already have headaches from trying to change their cell phone or cable plan. Make your options painless!
More brand for your buck
Your brand isn’t just your name, logo, and website; it fully encompasses your content, values, and overall essence. Many businesses don’t realize that your pricing strategy is just as much a part of your brand as everything else. Your branding influences your readers’ perceptions, impacts your pricing decisions, and ultimately shapes your publication’s sustainability.
The team at Redirect explains how your pricing strategy can be pivotal to the success of your newsletter.
‣ If your publishing brand is strong, it’ll create a perception of quality and trustworthiness among your followers. Fostering this type of loyalty will ensure your customers are willing to pay a premium for the quality content they can’t live without. Investing in both your brand and customer happiness is key.
‣ Your brand has the power to cast a wide net to catch all kinds of customers or hone in on specific demographics. Will you position your brand as budget-friendly, high-end, or a little bit of both? How you approach branding your business will help you discover what you should charge.
‣ The value attached to your brand’s name (brand equity) is significant in determining your pricing power. To build brand equity, you’ll want to invest in marketing and customer experience. As your equity grows, so will your reader’s willingness to pay for your services.
‣ When it comes to pricing, brand uniqueness plays a significant role. If you’ve done the work to differentiate yourself from other publishers, you can set higher prices without much negative feedback. If you’re giving your readership something they can’t get anywhere else, they won’t mind paying a little more.
‣ Don’t be afraid to try new things that can boost your already established brand. (Remember when the iPhone came out?) Just be prepared to reverse course if your experiments aren’t sticking. You never want to dilute your brand and sully positive perception, which can negatively impact your pricing.
‣ Building a strong brand is an ongoing process that requires constant commitment. Publishers that integrate branding into their pricing strategy, produce quality content, invest in marketing, and listen to their customers along the way always have the upper hand.
Curator’s pick ✍️
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