If a product is pitched to you as lower priced and “more convenient” than another, similar product how does that impact your opinion of it? On the one hand, you probably think “Less money, less hassle. Sounds good.” But on the other hand, if it is both lower priced and more convenient, doesn’t it have to be a worse product in some way? Maybe you hesitate. Maybe you start considering other options or decide to do without.
I see this happen all the time with online products – and in my world, particularly online educational products. Organizations offer topics, subject matter expertise, and amounts of content online that are similar, if not identical to what they offer offline. And then they charge less for the online option and promote it as “more convenient.”
The implicit message? “This is a slightly worse version of what we can offer you in person. But you don’t have to travel to get to it, and we’re going to charge you less for it.”
The customer who is in it for the education hesitates. Maybe she starts considering other options or decides to go without. But naturally there are always customers for any product who are willing to trade value for convenience and price.
And they end up being your customers for e-learning.
So what are the options?
- If your strategy is to go after customers that are willing to trade value for convenience and price – and that can be a perfectly valid strategy – then make it clear how the value of the convenient, low-priced product is different. Don’t deliver essentially the same thing but then devalue it by cutting price and pitching convenience.
- If your strategy is to go after customers who value the original product, deliver the same value in the more convenient product and charge a premium for convenience. At the very least, don’t charge less for the more convenient product. If you think that can’t be done, then somewhere along the way you are either not providing the value you think you are or are not making that value clear to the customer.
There are important exceptions to the above.
For example, if want to offer an online version of a product at a lower price or even for free because the costs associated with it are truly lower or you have recouped your investment in it, then do it – but make clear the reason for the low price, and up until that point price it based on the value it delivers – not on how it is delivered.
At all costs, avoid positioning your online products as “a slightly worse version” without really meaning to.
Hedgehog & Fox
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