Pricing Your Online Course? 5 Deadly Mistakes You Are Making
If you’re wondering how to teach online and make money, you’ll first need to get the basics down: figure out your material, teaching style, platform, and so on. But pretty quickly you’ll discover that pricing is a key factor in whether or not you can make a living online.
The truth is, most educators price their courses incorrectly, either overcharging or, far more frequently, undercharging for the content they’re putting out into the world. So, before you pick a price and call it good, you should carefully assess a number of factors to ensure your fee-setting is reasonable and you’re charging enough money to be able to expand your business.
#5 Biggest Online Course Pricing Mistakes
Here are five biggest mistakes educators make in setting their online course fees. Luckily, if you’ve made any (or all) of these errors, it’s never too late to rectify them and put yourself on the path to success.
1. Considering What Others Charge
When pricing your online course, it’s only natural to look at other people in your industry who are doing what you want to do, and doing it well. This leads some budding entrepreneurs to find a course like theirs, with similar module structure and content, and simply borrow the pricing without ever thinking through some of the more complex issues involved. For instance,
- the other course may or may not offer bonus materials the way you do
- it may not offer free instant messaging with you as a coach
- it may be missing on the key elements that cost you serious time (time is money!), then you may be selling yourself short.
True that some products pricing can be pretty transparent. And that may make it harder for you to set your pricing above the competition. It’s specially true for long-established concepts. Your potential audience may judge on the basis of what such courses usually cost.
So what can you do?
Try making your content unique, ruling out the possibilities of “apples-to-apples comparisons”
2. Deciding Pricing Vaguely or Without Analysis
Your pricing should be based on more than what you’d like to make for your course or what your competitors make for their courses. In fact, if you only think about what you want to make, you’re committing a deadly mistake. So, when setting the fees, take into account:
- the amount of time it takes you to craft your course
- your overheads
- your material outlay, and
- the effort required for you to actually teach the course.
However, there’s another side to it.
You must also take customer expectations into account. The best way to look at this is from the opposite point of view: does the prospective student think it is reasonable?
Take a look at this brief cost and price analysis primer from Florida State University. You may want to consider your course pricing from the standpoint of how much:
- learners have paid before
- they were willing to pay before seeing your price
- other, similar courses cost
- courses of this general type and length usually go for on the market
Many a times, it’s okay to price your content slightly above what people have generally paid before, just not wildly.
3. Considering Only Your Own Location
We live in the internet age, which means that all online courses enter a centralized pool. The cost has different dynamics, depending upon the local economic factors.
The idea is – you shouldn’t be pricing your online course lower because you reside in a lower currency value area. Similarly, be wary of pricing your course higher simply because you’re renting a Manhattan apartment.
The best idea is simply to take your location out of the equation. Your audience may be from all over the country, or even all over the world, so your distinct geographical location is really of no account when it comes to pricing. Base it on local economic factors.
4. Not Considering the Value of Your Course
When all is said and done, analyzed and considered – you should sell your course for what you actually believe it is worth. Not doing so is a major lapse in judgment that unfortunately all too many new teachers make.
Let’s break this down, because there are two mistakes embedded within one grander mistake. First, you may believe that because you are new or because there is so much available online, your course can’t possibly be worth what it’s, well, worth. But that isn’t true.
The point of note here is that even when repackaging the same idea in a new form (50 Recipes to Help You Lose 50 Pounds By Christmas!), you can still charge the same price.
The lesson? If you do something and do it well, even if it’s formulaic, charge the full value. You deserve it. Plus, it signals to prospects that you believe in the content of your course. It’s a win-win.
The second danger in not considering the true value of your course is that you may undersell it in an attempt to make it more appealing. However, this effort to “psychologize” the process is usually misguided.
This kind of discount thinking is rampant across the Internet, and you’ll even find blogs that advise it. But it’s a mistake, because it will mess with your timing and cause untold headaches. Believe in the value of your course, even if it has been taught before, and charge a fair price. Then call it good.
5. Believing That You’re Overcharging
This is one of the most insidious mistakes many new teachers make when they first put themselves out there online. Because they’re new – they feel they just can’t be “worth” the price. Ditch that thinking right now and charge what you think is fair from price analysis and your own time and labor.
If you’re still concerned about overcharging, however, do an experiment.
Test the demand curve. Do this by setting your price at two different points and then seeing which sells better. So you might, for instance, sell your course for $100 and $150, then put it out to customers.
Instinctively you might want to charge $150 if anyone is willing to pay that, but consider this carefully: If only 20 people buy it at $150, then you’ve made $3000. However, if by dropping the price to $100 you can interest 40 people, that’s $4000. You come out ahead overall. Test the demand curve before deciding you’re overcharging, and let customers tell you what’s fair and worth it.
Of course, being able to set prices smartly doesn’t mean you automatically know how to teach online and make money, but it sure gets you closer to the goal. Next time you put a new course up, make sure to take the time and price it correctly so you can get the most customers and build the most successful business possible.