Quote:
Originally Posted by The Porn Nerd
The problem with lowering the price is you have to make up the sales with volume to increase profits. That is not really possible. Cut the price in half you need to sell twice as many Memberships. Can you do twice as many? Probably not.
Also the lower the price the smaller the pie for affiliates. So it's better to RAISE prices and offer more. Don't scrape the bottom of the barrel out of desperation.
|
when i still owned paysites I had a very nice model that worked pretty good.
The membership started at 39,95 and went down every month 5 euro til it endet at 9,95
The lifetime value I had than was pretty much higher as constant high price or constant low price.
1. point is that you have to see the price from the view of a user. When he joins everything is new for him and he gets most value for his money.
2. This leads also to the fact that some users are joining for a month, unsubscribe and come back after 1 year when they expect again a lot of new content.
3. There are also users that unsubscribe in holiday times or for other reasons when they do not have that much time to surf.
4. As my model always started with the high price (even for returning members) people was calculating this and did not temporarily cancel to keep the lower price.
I think this system is not only smarter it is also much fairer than a constant price because no membersarea is changing the complete content in a month and from the view of a user it means that he pays the same for less in the next few months.
We also know all that the usage of a longterm member is much lower than the usage from a new user and this fact is felt by the user also.