Selling a Course: Monthly Payments VS One Big Payment

[Zach_0094]

I have an online class that I will be selling. My question is this. Which should I use and which one is better? Monthly membership payments? Or one big lump sum payment?

The payments would be for access to the videos, downloads, and help.

 

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[ZCP]

First get 'a' payment.

 

[keep]

Typical structure that I see is:

1. One payment. Then,

2. On your next launch, offer a 2x payment or 3x payment plan. That will entice the people who passed up buying initially due to the price tag. Should increase conversion rate.

Like ZCP said, the first step is making sure someone is willing to pay you a $1 for it, at least.

 

[Andy Black]

I’d go with one payment. I don’t want to let the smash-and-grab folks in.

I believe “Sales is a screening process”, and “The first purchase is a test”.

If that first purchase is too expensive initially then I’d either create a more basic course for a smaller one time payment OR I’d price the course lower at the start and increase it as I iron out student queries and get testimonials.


Oh, and I don’t offer refunds.

And my one-time course payment is morphing into an annual payment for access to the course, future courses, and a community.

Curious what you think @Fox @SinisterLex @biophase ?

 

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[Fox]

Its a tricky one.

Removing profit for a moment - lower payments usually result in a lot more drama and less engaged students. A one off payment generally means that when someone does join they are ready to put this to you and take action. These are the kind of students you want since they get the best results and they show others your material works.

From a profit perspective I would say having a one off payment is better also. I had a split (1/2) payment options before and only around 10% took that option. Most people like to just pay once and get it done with.

I think if anything have a lower priced separate course that acts as a foundational course for the larger one. Price it low, cover the basics, and then leave them to join the main course. Maybe include a discount code or something too.

 

[Bhanu]

I would also go for one time payment . Here again MJ s Event vs Process principal is at play . We are here to make our customers life easier even while subscribing to our course. As a customer what would you prefer (assuming that you are fully satisfied with the course being offered ) ? Paying one time(Event) or paying again and again every month(multiple events/process every month) ?

 

[masterneme]

Both.

First the one payment because it's higher and it will serve as a reference number.

This way the product will be perceived as higher in value and the monthly payments inexpensive.

To know why read this: 42 Pricing Tricks Based on Psychology & Neuroscience

Edit: And do some A/B tests.

 

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[Rawseed]

@Zach_0094 Thank you for asking this question. I've been pondering this as well.

My concern with the one lump sum payment is the need to continue updating the course in the future, even if there isn't much new revenue coming in. People are paying for lifetime access.

I've been considering a three tiered option. I'll illustrate what I'm thinking using hypothetical numbers.

Tier 1: $50 a month (Double the yearly price)
Tier 2: $300 a year
Tier 3: $1200 for lifetime access (Quadruple the yearly price)

My hope is that they'd choose Tier 2.

Definitely interested in getting the opinions of those of you in the know.

 

[Andy Black]

@Zach_0094 Thank you for asking this question. I've been pondering this as well.

My concern with the one lump sum payment is the need to continue updating the course in the future, even if there isn't much new revenue coming in. People are paying for lifetime access.

I've been considering a three tiered option. I'll illustrate what I'm thinking using hypothetical numbers.

Tier 1: $50 a month (Double the yearly price)
Tier 2: $300 a year
Tier 3: $1200 for lifetime access (Quadruple the yearly price)

My hope is that they'd choose Tier 2.

Definitely interested in getting the opinions of those of you in the know.

Now I have an online course I don’t like the “buy it and have it for eternity option” - since I still have to host it. It would be different if it was something sent in the post.

Lifetime access means you’re tied to it forever. Do you really want to keep paying for hosting and support of your online course forever? What if you stop selling after a year? And no-one logs in for another 5 years? At what point can you take it down and stop paying for hosting your course? I don’t know sooo...

I’m moving to an annual fee for membership in a community that has the course inside, plus other courses, plus progress threads, plus a community.

As well as screening for the most motivated members, I prefer the idea of an annual payment over a monthly payment because that’s 12th the volume of transactions that could go wrong.

Not moved to a forum yet so we’ll see how that turns out.

 

[Dunkafelics]

So I’m moving to an annual fee for membership in a community that has the course inside, plus other courses, plus progress threads, plus a community.

@Andy Black, I see the philosophies of James Schramko appearing here

James Schramko the author of Work Less, Make More - which is a great resource for business building recommends using a subscription model for courses and inner circle type groups.

The idea here is that you gain a recurring subscription every set period (1 month, 6 months, 1 year, etc.) AND you have to continue providing an updated and worthwhile product.

If you are making a starter course to get an idea of the market mind. Possibly look at making it a one-time cost to get feedback and an idea of how to better educate your audience.

I can tell you right now as a consumer, it is frustrating to purchase a one-time, "lifetime" course to then find out that the course has been discontinued or deleted.

 

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[Andy Black]

@Andy Black, I see the philosophies of James Schramko appearing here

James Schramko the author of Work Less, Make More - which is a great resource for business building recommends using a subscription model for courses and inner circle type groups.

The idea here is that you gain a recurring subscription every set period (1 month, 6 months, 1 year, etc.) AND you have to continue providing an updated and worthwhile product.

If you are making a starter course to get an idea of the market mind. Possibly look at making it a one-time cost to get feedback and an idea of how to better educate your audience.

I can tell you right now as a consumer, it is frustrating to purchase a one-time, "lifetime" course to then find out that the course has been discontinued or deleted.

Yep.

I created a course (because I kept getting asked for it over a year or more).

The course had a Facebook group attached to it just to check everyone got on alright with the course.

Then I asked folks in the Facebook group what they wanted next, and I thought a proper forum would best serve their needs (plus I like helping people in forums don’t you know).

Then I read “The Automatic Customer” and realised the DFY business I was building was in fact a subscription business.

Then James Schramko’s stuff suddenly seemed applicable to what I was doing to help the DIY folks.

Now I’m a member of his own 500-600 strong community. Learning by watching as much as anything else.

I’ll create a progress thread on the inside soon.

 

[JoelM]

I have an online class that I will be selling. My question is this. Which should I use and which one is better? Monthly membership payments? Or one big lump sum payment?

The payments would be for access to the videos, downloads, and help.

If your content is updated frequently, do monthly. If the course is good for a year or longer, do one time payment. However, I am more reluctant to make a one time big payment than just small monthly payments.