Sell High Ticket Items For Big Profits
August 23, 2007
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I see it happening all the time. The new business owner gets excited about their online prospects. They read a few ebooks, pick up a couple of courses, and get started with their first product.
And for their first product, they create a $7 ebook…or maybe they go way out on a limb with a $10 product. Their concept is that with such a low price, it should be easy to sell.
Sure, you may sell more at this low of a price, but what’s your overall strategy? How do you upsell them to a higher ticket item? What are the other products you make available to them?
Here’s a rule you must always remember…
Good marketing will not overcome bad math!
You have to sell 100 copies of that $7 product to just make $700. If you want to earn at least $5,000 this month, you have to sell 715 copies…and that’s counting you as having zero advertising expenses. That’s a tough road to follow. Averaging 24 sales a day without advertising just to earn an OK income is not an easy to plan. And it’s never one I’d want to follow.
Do the math! Let’s say you want to earn a million dollars. Sell 100,000 items at $10…or 1,000 items at $1,000.
Please note that high ticket could also mean $5,000, $10,000, $20,000 or more. These higher ticket items greatly reduce the number of customers you need to reach your goal.
What if you sell 10 of your $10 product this week, you make $100. On that $1,000 product, you made $10,000. Can you live on $100? Not likely. Can you live on $10,000 a week? I surely hope so, or we need to take a serious look at your lifestyle!
How about taking care of the customers? A surprising fact I’ve found is often the higher ticket customers are less demanding. With a higher ticket item, you obviously need a lot less customers…which means less customer service on it’s own…and less staff. So less expenses in selling those higher ticket items.
You do the same marketing work for more profits. You have to create a sales letter, autoresponder messages, JV letters, etc. for either product. The sales letter for the higher ticket item might be a little more detailed, but those same details can find their way into your email messages, videos, teleconferences, etc. You make more money from the same work when you sell higher ticket products.
So what’s the purpose of a low cost product?
I’ts a lead generator for your high ticket items. Build a stronger relationship with your customers. If you’re selling another product first, you can also move into additional marketing such as direct mail or phone to sell the higher ticket item.
So the only question left is how do you develop higher ticket products?
One key of course is by adding additional value. Review my previous article on 20 Ways to Add Value to your products and services. Always increase your value until you’re giving way more value than what you’re asking for in price.
Another key is to change who you’re marketing to. Pick markets where your customer have money…seek to sell to the affluent instead of those barely getting by. A great way to start this is through picking up a couple of magazines such as the Robb report. For me, this was difficult at first since I came from the place of being poor and in debt. So it was hard to wrap my mind around the fact that there were a lot of niches where people had money…where they bought $5,000 golf clubs and attended $25,000 marketing conferences.
Yet, that’s one of the biggest changes you can make…a change in your mindset. In most businesses, people are willing to spend money to get what they want. And these are some of the best customers you can ever have…if you focus on them and deliver exactly what they’re looking for.
advertising affluent bestseller business plan goals high ticket income information millionaires niche products profits publishingPopularity: 30% [?]
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Terry;
Great advice (as usual!)
Welcome back from vacation.
Fred
No Guilt, Charge More, Intentions: Three Great Blog Posts You Need to Read….
I just read thee great blog posts from three of the blogs in my blog roll (located over in the right-hand column) that I’d encourage everyone to read. At first glance you may not see that the subjects of these……
Great post Terry and as always just because information repeated - doesn’t mean its outdated …
I think the major hurdle people just starting in the IM face is giving themself appropriate credit. Procrastination becomes major problem as you constantly work on “making product just a little bit better” and sometimes simply end-up going for low price …
While each of us posses unique knowledge we can share and profit from - many simply think that they don’t have enough authority to present a high priced item although it is more rewarding. Been there, done that … and can testify to it first hand
But great reminder!
Alex
Hi Alex
This article was great.
It changed my thinking towards pricing my products.
Thanks
Koorosh
http://www.hiddenmindsecrets.com
Great advice Terry,
Cheap is no way to sell expensive!
Art
[…] post today about selling high ticket items for big profits reminded me of some extremely valuable advice I received many years […]
I was just about to do the same thing!
But will people buy a $49.95 product vs $9.99 product of course it’s the same thing iam going to sell!
And if you agree! another Internet Marketing GURU Ken says to upsell! he stresses on upselling
so i still believe on pricing @ 9.99 and upsell them with more products!
What’s your suggestion Terry!
Kiranraj,
There’s nothing wrong with selling a 9.99 product as long as you know it’s just a lead generator and don’t look at it as a profit center. It is there to generate leads for your other more profitable items.
Thanks Terry!
I am writing this in tears of gratitude!
I know i have a gr8 product and i know people would love to buy it! and would love to put a honest price for my product!
I know i will make it big one day this is my first venture! I am on the (internet marketing) stuff when i was about 17 yrs old (it’s been 4 yrs now)
Iam a 21 yr old now and never had the courage to get it started all these years i was educating myself! But never had the resources or the courage!
Now i have a gr8 Friend like you who actually replied to my comment which is gr8 what else i want!
I will surely party with you one day once i make it BiG! really BiG on the Internet (i know i will one day)
Thanks for the suggestion!
Cheers!
I wonder how you define the right price for the product. Asking people is fickle, because they do and say different things.
And most of all, yes, you can use the 20 ways of adding value to the product, but that’s a lot of work, if you want to take a $10 ebook to the $1000 ebook.
Of course, it’ll pay for itself, but it isn’t just 100 times more. More likely, it is 1000 times more work, really.
What do you think?
The right price can only be determined by testing prices. You can survey…but the bottom line is people must vote with their wallet.
It wouldn’t be even close to 1,000 times more work to produce a $1,000 product. It may be 10 times more work to do so, but that’s sometimes the difference between a project that makes money and one that loses money.
Absolutely Terry!
That’s why i have decided to price my product to $49.95 and i have added tons of more bonuses
Yes..the bonuses does take time! But i know the outcome is going to be gr8!
As you said earlier simple math!
Iam making 5 times more money! with this price! and also the value of this product has increased and iam sure of its success!!! nothing can beat it!
I surveyed on the internet and everybody is selling the same product under $10 but iam not bothered because of its pure value!
To make a Million i now need under 50000 customers! I don’t think i need so many either with the upselling into it!
so instead of 250,000 customers, i can make a million with only 1/5th the number of customers…that’s the point!
And another thing i wanted to ask you Terry!
Everywhere on the internet there is buzz going on about a new thing!
GOOGLE ads free a man seems to have found out the trick says it’s completely legal and he has found a way to get all the Pay Per click ADs completely FREE and says he is making Millions!
All i know is that he must be referring one thing!
And that is create an affiliate program and recommend his affiliates into PPC ads! that’s the only genuine way i know to get ppc ads FREE!
What do u think Terry!
My recommendation is not to get caught up with all the buzz about whatever new thing is “making millions.”