Quote:
Originally Posted by Mutt
i don't believe cutting prices in half or less will result in twice the sales.
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Agreed. You'd have to do MORE than twice the sales volume to make it worth while. People have to remember looking at something like this not only are you slashing your prices, but you're also slashing your profit margin.
If you cut your prices in half and only double your sales, in effect you're topline is staying relatively the same while your operating expenses / overhead are increasing to accommodate a larger customer base. It's also got to play hell with your target CPA for your marketing budget.
Quote:
Originally Posted by Brujah
This really isn't anything like Netflix. Netflix isn't a producer of content and doesn't create anything exclusive. Netflix works for different reasons than a price point. It has an enormous catalog from many/most studios rather than a subset. You can use your account to stream to your computer, tivo, ipod/iphone, etc...
Netflix has an affiliate program too don't they?
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I also feel looking at netflix is an apples to oranges example as well.
In my experience when it comes to setting your price point it's all in the marketing. You have to decide if you're product is going to be a mercedes or a toyota. A mercedes and a toyota will both get you from point A to point B, but a toyota is a hell of alot cheaper and in all honesty, probably more reliable (or at least cheaper to maintain)-so why would anyone buy a mercedes?
In the online space there is great flexibility to offer upgrades that for customers hold a high perceived value that can be added into your product offering for negligible cost. You just have to decide which path you want to follow and what you feel is right for your product.
