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Originally Posted by PR_Dave
100% not true. I am happy most of you do not get it.
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Quote:
Originally Posted by PR_Dave
Better retention is part of it.
The smart ones will dissect instead of looking from the outside.
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I was applying logic to subscription sites where recurring membership fees are the main source of revenue. Obviously this will not apply to all businesses, if you make more of your money on lead gen and upsells you could give your membership away for free and still be profitable.
You could always fill your buy page with cross sells, fill your member's area with upsells, blast the hell out of your list and sell the user data to everyone under the sun... doing that you could charge $1 for unlimited access and still walk away with money in your pocket. It all depends on the way you choose to run your business.
My industry is dating, and not so different from content there are sites that charge next to nothing and sites that give it away for free. You can discount my opinion if you want to but we face very similar market challanges. You don't see a bull rush to lower the price point in dating, I don't see why the same logic wouldn't apply here. Just like toyota vs mercedes or tap water vs bottled brands, in my opinion it's all about how you market and present your product.
If you slash your prices, unless you simultaneously bring in an additional revenue stream to make up for the difference, you most certainly are slashing your profit margins. I don't know how anyone could view it any other way.