“Know your worth” is not only an important piece of advice when braving various life situations (i.e. job interviews or dating), but it’s also crucial for entering the online marketplace. There are the obvious factors to consider when pricing your offerings. For instance, there’s the time spent creating your product, the overhead to sustain your business, and even knowing who your ideal client or student is and what they’re willing to spend. If you’ve already established your rates, gaining professional experience as well as the reality of inflation are both reasons to consider increasing your prices down the line.
What’s more, there are more subtle, often overlooked considerations. Think what is the offering actually costing you to create it and what is the value you’re providing? These considerations might be enough to consider increasing your prices and rates of your online course. But, how do you tell your customers you’re raising prices? That’s another thing.
Because value can be easily conflated with money, and non-financial benefits can be harder to measure, it’s common for new entrepreneurs to default to pricing based on a “reasonable” hourly rate. Many even low ball their services to avoid scaring off potential customers or students.
But playing it safe can actually be dangerous in business as it may not accurately reflect the work creators put into their offerings. And while it’s normal to worry about scaring off potential clients with a high price tag, investing in something holds the buyer more accountable. If they’re getting a deal on something, they might not appreciate it as much or be as motivated to follow through with it. And when it comes to online course completion, follow through is key.
Power of premium
“If you’re not pricing your products and services correctly, you’re shortchanging everybody: your clients, your family, and yourself,” asserts Hello Seven CEO Rachel Rodgers in her book, We Should All Be Millionaires. “Instead of trying to be cheap and accessible to all, focus on being wealthy and influential to many. You will make a greater impact this way.”
Still, we fully acknowledge how challenging and confronting pricing your offerings can be. Whether you’re setting your rates, ready to raise them, or simply starting to think about if course creation is right for you, we’ve created this handy guide to help empower you to charge what you’re truly worth.
How to know when it’s time to raise prices
Tip 1: Understand the true value you provide
It can be difficult to measure value, which gets easily entangled with financial gains. When considering what makes your idea or offering valuable to others, go beyond what you’re selling and consider why you’re selling it.
- What makes your approach unique?
- What are the immeasurable qualities your student or customer will walk away with?
For instance, you might be an art teacher, who beyond different painting techniques, empowers students to explore their creativity with confidence and playfulness. Or you may be a yoga teacher who doesn’t just demo the fundamentals of poses but also offers tools for increasing mindfulness and building resilience, too. Set and increase your prices from the place of what students get, rather than just the course.
Tip 2: Shift your money mindset
As you consider raising your rates, notice if any stories or limiting beliefs around money come up in your mind. Even if you consider yourself to be a generally optimistic or highly-motivated person, it’s common for a lack mentality to pop up with conversations about money or to be masked behind behavior such as procrastination.
By simply bringing more awareness to your relationship with money, you can start to change it. Get curious about where your limiting beliefs come from. Each time a story about money comes up, write it down. Is it really your belief, or is it someone else’s voice in your head, perhaps something you picked up from a caregiver or teacher? After identifying where the story comes from, see if you can shift it. Each time you notice it arise, rather than believing it or beating yourself up, see if you can change it to an affirmation rooted in abundance.
Tip 3: Release what’s no longer serving you (or your clients)
Overextending or overcommitting is a common manifestation of a lack mentality. Entrepreneurs can become addicted to work and push beyond personal limits. This can happen because there’s a belief there won’t be enough income or clients won’t be interested.
Less is more
Assess which areas of your business you might be ready to release. Perhaps they’re no longer exciting you or they’re more depleting than energizing. Next, consider how removing these things would free up time to add value to your existing offerings. Even if it’s simply giving you more energy and attention, see how your clients or students can benefit.
In addition to adding new or bonus material to an existing offering, you might consider creating free content, an opt-in incentive, or a lower-priced introductory course to justify an increase in already-established offerings. Free and affordable content can build trust among new customers and give them a taste of what you have to offer before potentially investing in funneled items.
Tip 4: Align with your values
Ultimately, setting and raising your rates is upholding a boundary. It teaches clients how to treat you and respect what you have to offer. If you’re still concerned about making your offerings accessible and equitable, consider creative ways to offer competitive pricing. One way to do this is by offering a sliding pay scale, in which customers choose their rate, or offering scholarship opportunities. Feel into what truly feels good for you, without getting stuck in a comparison trap, and find a sweet spot where your generosity is reciprocated.
Tip 5: Decide where you want to go and work backwards
Consider what more money will do for you and your clients, how it will better help you serve. To help clients create more abundance, Rodgers suggests:
“Get a piece of paper and write down everything you would love to have. Your ultimate dream life…make a list of what you truly want. Then, take your dream-life-list, head to Google, and find out how much each item costs…once you have this information, it’s empowering, and it leads to new questions. Now you can ask yourself, ‘Well, what’s it going to take to earn $10,000, $20,000, whatever amount per month so I can have my dream life? How can I pull this off?’ Get creative and write down 25 different ways you could earn more and make it happen.”
Bottom line: How to know if you need to raise prices can be tricky. But tapping into your desires and understanding your value can help get you to where you need to be.