December 28, 2009 147 Comments

The Old Value-Cost Conversation

I’m an affiliate for the Beyond Blogging ebook. In the comments section of this post, people questioned the $47 cost of the ebook (which I think goes up to $97 after a fashion). It’s a question I’ve seen many times, and the question works something like this:

There’s no paper expenses. There’s no mailing costs. Why does this cost more than a traditional paper book?

First, let’s take free off the table. I covered that in the audacity of free. So, given that we believe there’s some value in what’s being sold, let’s talk about how pricing works OVERALL.

Pricing comes from these factors: perceived value, market value, product/brand recognition, and probably several factors I’m not at liberty to explain. Nathan Hangen and Mike Cliffe Jones priced Beyond Blogging to be in the middle pricing of most ebooks I’ve seen. I’ve paid everywhere from $9 to $150 for ebooks, depending on what I thought I’d learn from them.

In my mind, when I paid $150 for the ebook I bought (about product launches), it’s because I knew that if I learned what was in the ebook, I’d stand to make more than $150 back if I was able to incorporate what I learned.

That’s the real question to ask when presented with a price: is paying this going to earn me back that much or more value?

For instance, I buy videos. I just got Iron Man’s Armored Adventures, season 1, for $19.95. I have to decide if that’s worth however many hours of enjoyment I’ll get from it. The real answer is probably no, so maybe that was a bad purchase.

No one forces you to buy things. Instead, they recommend things they think will be of value. When I agree to be an affiliate for a product, such as the Thesis WordPress Theme, it’s because I believe it’s valuable, and I want you to consider it for your projects and growth.

I’m promoting Beyond Blogging because I believe there’s much more than $47 worth of information in there. For instance, that’s several hundred times less than it would cost you to pick my brain for a day, and I’m only one of the 15 people interviewed. It’s at least 3x less than an online course of similar content.

So, it’s all in how you slice it. I buy things that help me grow my business. Where do you put your money?

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remarkablogger

What the hell are you talking about? Explain what is “scammy” about this. How do you mean “presented like a dude selling watches out of the back of his car”? Explain yourself.
remarkablogger

1shoppingcart is one of most used and trusted shopping cart systems in the world.
remarkablogger

Here is something to consider: the people with an “investment mindset” instead of a “cost mindset” are the ones perfectly willing to shell out hundreds and even thousands of dollars on training they know will help them succeed in their pursuits.

And those are the people who DO succeed. I don't know a single successful person who is also a cheap-ass miser that can't even invest in his own success. All the people whining about the cost of this (or any) info product can basically put themselves in the “failure” camp until they make that leap of faith and invest in themselves. Strong words, I know, but I don't see anything to indicate otherwise.

I've been through this myself, and the difference is huge. I spend hundreds of dollars a month on my own education, and it shows because I make thousands of dollars a week. Where did my ability and knowledge to do that come from? Partly from experience but a great deal of it came from investing in myself.

And the whole point of an investment is that you get a return. It's not a cost. Wake up, people. You want to succeed? Do what it takes. Stop whining and start investing.
Phil

I'm not sure about that.. according to the 1shoppingcart.com site, they put it at 25,000 stores. According to OScommerce.com, the number of stores is roughly 10 times that at 226,500 installs (that they know about). I can't speak for the trusted part, but I still think that if you're serious, the cart needs to be on your own domain- period. Why? Well, what happens if 1shoppingcart.com goes out of business tomorrow? Guess what- so do you! It's like putting your business site on geocities.
remarkablogger

That's true. On the other hand, no upgrades or maintenance necessary. :-)
Far more open source projects die untimely deaths than do profitable
businesses. I don't think OScommerce has anything to worry about–they've
reached “escape velocity” thanks to their large userbase.
http://chrisbrogan.com Chris Brogan

Well said, actually. It depends how you normally run your expenses.
http://chrisbrogan.com Chris Brogan

I get that every month, actually, Joseph. Every month, someone asks me if I've thrown it all in. EVERY time a $ shows up on my site. : )
http://www.onlineinvestingai.com/blog/ George

I totally agree. People love to complain that it is “too expensive”. But those same people will spend thousands of dollars on things that do not serve them at all: flat screen TV's, cable, computer games, alcohol, food and ice cream.

It's about considering what we really want to get in life. If we think, “I would like to make money from a successful blog,” then $47 is a small investment. But the challenge is that most people never get that far.

I think the solution is to figure out what our goals are in life (or at least for the next year) and then allocate a certain amount of money to achieve them. If we allocate just 10% of our income, then most people would have thousands of dollars per year to invest. Now, that $47 is not expensive at all.

The other part of it is that there needs to be a guarantee that the person will get at least $47 worth of value from the book. Is there a money back guarantee? If not, then it's probably not a very good product.
anthonymendez

I buy things because they entertain and “nourish” me spiritually (hey iPods make you happy!). Perhaps I should reconsider my purchasing decisions.
http://www.buckdaddyblog.com BuckDaddy

I am not sure how the ebook showed up on my radar orginally but then I saw a testimonial from a friend on the page. I wasn't 100% sold. I emailed him and he gave me an honest review of it, both pros and cons. I still wasn't sold. Then I saw you endorse it. I trust both you and him. I don't you would give it all up for some % that comes with being an affiliate.

$47 is a little steep but I dug in the couch. The ebook is 200 pages long. Chris, if you ebook is $10 at 60 pages then a 200 pages book would roughly cost about the same. Depending on what your book is about I probably buy it as well.
http://josephrooks.com Joseph Rooks

I bet. Good thing you're in the business of selling to people who need what you have. Selling to people who won't use it is a lot harder. :)
http://ittybiz.com Naomi Dunford

Well said, sir.

Wanna start making as much as the big kids make? Start spending as much as the big kids spend.
lauraroeder

I'm always fascinated by this discussion. As sellers, we can say all day long “it's worth it if you get ROI” but we have to be honest that is NOT what consumers base their purchasing decision on. If that were true the packaging, length of sales page, and length of book would be meaningless, but those points are always brought up.

We have to think how consumers think. Whether it makes sense or not, people can't help but think of the perceived $0 it costs to print and distribute an ebook. Because keep in mind, as consumers we haven't yet been trained to evaluate digital products. We're used to building in scarcity and cost of materials into our buying decisions, we've been doing that our entire lives. I see this watch and think OK, it's made of nice materials, the quality looks high, and you can't buy it just anywhere, these aren't mass-manufactured in china. In digital products we lose a lot of those factors, so I think everyone is still experimenting with positioning digital products.
marryroy01

It's made of nice materials, the quality looks high, and you can't buy it just anywhere, these aren't mass-manufactured in china. In digital products we lose a lot of those factors, so I think everyone is still experimenting with positioning digital product.Start spending as much as the big kids spend.

vitamine e
http://www.notaproblog.com Jordan Cooper

I think the issue with the price, no matter how it's spun, comes back to trust. A product that is priced low doesn't require as much trust in it's quality since “hey, it's only $10, so I'll take a chance!” A product that is priced high *does* require more trust since “woah, I don't want to spend $150 and find out it's complete garbage!”

People say the music industry “failed” because of piracy. It wasn't this. It's because someone like me was tired of spending $20 on a CD to find out it was crap. They lost my trust at that price point. The same theory applies here.

Depending on how you plan on utilizing it, I can understand how $47 for Beyond Blogging can seem like a hefty price tag, but the dollar amount, in and of itself, doesn't change the value of the content inside whatsoever.It's only your perception of it's value based upon your own individual trust with the producer of it.

If you don't know Nathan & Mike and aren't willing to make that leap yet, then so be it. But don't take it out on the product just because you're only willing to spend $15-$20 on their “authority”. They obviously have to work on building this with you personally before you'll be able to make the jump. The fact that you're here, I'm assuming means that Chris has gained your trust already. Just due to the fact he's willing to put his reputation behind this product should amount to something within you regardless of your opinions of the exact perceived “scam-like” presentation mentioned in these comments.
http://diamondthings.blogspot.com sarah84

great paid http://mp3bay.org/Electronic/Genre-id299/27/ – mp3 downloads
remarkablogger

Naomi: exactly.
christinakatz

I think what you are up against isn't what you are putting forth, Chris. I think what you are up against is that a “book” is supposed to take lots of fabulous information and package it for the masses for much less than a consulting fee. You might say that it's the best of what you know at a fraction of the price but what book-buyers are looking for is all for much less than a price point $47. We're looking for the $9.99 version. Your guys are offering a $47 version with the promise, paradoxically, to raise the price soon. You know some will buy at that price. I'm sure they will. But for me, it leaves a bad taste in my mouth. I also dislike the infomercial style of selling. It's always a deal-breaker for me, although I know that it won't stop others, who will pay almost any price after reading a very long sales pitch. Finally, I know your name but not everyone's who are part of the package. I don't know the packagers. I never get involved with unknown packagers because they dilute credibility because they don't have my trust already and I don't want to become part of their learning curve.
http://www.webinknow.com/ David Meerman Scott

I just got my copy of Jane's All the World's Aircraft 2009-2010 edition. This the 100th year the book is published so they are obviously doing something right.

The book costs $965.00 if you can get it. (It is currently out of stock on Amazon US).

Is it worth it? Of course. Does everyone need a copy? No. But those who do will happily pay.
http://www.bitsfortheboat.com/ boat fenders

I get that every month, actually, Joseph. Every month, someone asks me if I've thrown it all in. EVERY time a $ shows up on my site. : )
http://andydolph.com Andy Dolph

Great post Chris -
Incredible discussion in the comments as well.

I just want to throw my $0.02 in a different direction – for me, how much I willing to pay is a combination of my perception of the value of the information (which has been discussed here in great detail) AND how easy I think it will be for me to absorb and use it. I'm always hesitant to buy books or e-books because I know that I tend to not get to reading them – I tend to buy audio versions quickly because that is my preferred mode of absorbing information and I can do it while I'm doing other things like driving – though I spend a lot of time just listening to audio books.

Chris, I would probably have not bought your book (as interesting as it seemed) if it had not been available at Audible.com. I'd expect the dead tree edition would sit on my nightstand in a stack of other interesting stuff for a long time before I got to it – if ever. The Audible version will be read within the next week or so….

Just another thing to think about -

Andy
http://www.kaplancopy.com/blog Jodi Kaplan

When I was at The Economist, we sold dead-tree softcover books (the only kind available then) for between $150 and $495. We called them research reports.

Looseleaf services (sort of a big weekly or monthly newsletter that went into a big binder) were up to $1,295.

Were these books designed for everyone? Clearly not. But those businesses that needed the information gladly paid for it because either they couldn't get it elsewhere or it was very difficult to find.
http://chrisbrogan.com Chris Brogan

That's a great point, Andy. My mom uses ebooks but has to print them first. She cautioned me not to make my ebook a landscape mode for that reason. She prefers to put ebooks in binders. (Yes, tree lovers – some people are still printaholics).

You're right that format matters.
http://chrisbrogan.com Chris Brogan

Great point, David. Great point.
http://chrisbrogan.com Chris Brogan

Yep. Magical, eh? There's a “marketplace” for information.
http://chrisbrogan.com Chris Brogan

All good points, Christina. The first thing is, the book is pointed towards people who probably won't know many of the names: i.e. people new to the shores of blogging. The marketing Nathan and Mike used wouldn't be exactly how I'd word it, but then, I don't necessarily find their marketing bad. I just do things differently.

Someone said it in a comment I've yet to find, that “effective” marketing is rarely “cool” marketing.

One project I'm working on in 2010, is with Brian Clark, Darren Rowse, and Sonia Simone (to name a few) to help better merge the world of “yellow highlighter marketing” to the cumbaya crowd of social marketing. The middle ground, the 3rd Tribe, as we're calling it, is what I think people are hoping to see.

Stay tuned. : )
http://chrisbrogan.com Chris Brogan

Quite interesting points, Jordan. You, obviously, have some experience by way of your career set. I think your points are really fascinating and I'm glad you're participating.
http://chrisbrogan.com Chris Brogan

I think consumers do look for a perceived value. I further think you're right that this highlights what isn't being well-transmitted: the gap between “analog world” and what's now. It gives me lots to think about.
http://twitter.com/chrisgarrett Chris Garrett

Hi Phil, have you got any website examples for information products you have bought? I think it would help everyone in the discussion if we could see what you mean to compare.
http://lianalehua.com fittorrent

Very well said. I thought for a few seconds to determine whether or not buying Beyond Blogging would be a good investment before pulling the trigger. As most often happens, my return has already exceeded the dollar cost in time saved re-camping my blogging and business strategies.
http://andydolph.com Andy Dolph

I think the best thing is to give choice whenever it's practical to do so – audio, hardcopy, e-book, video, professional narrator who arrives at your hose in a tuxedo to read it to you personally…. (well maybe not the last one…)

Andy
http://twitter.com/abarcelos Anna Barcelos

I think e-books that feature successful people/case studies (those who have rolled up their sleeves and done actual work) in your field of interest should have a monetary value and am prepared to pay for it (I actually did purchase the BB e-book). Amber Naslund had a great post about willing to pay for things vs. free the other day as well.

When I invest in e-books, books, etc. the question is “Will this help me achieve certain goals in life/business?” The ROI for me isn't always black and white. There have been times I've spent money on a book that enriched my life in ways you can't assign a dollar figure to (but worth much more than the price of the book).

Expectations with e-books are that because they are not actual books, they should be given away. Internet marketers (sorry but ya did) kind of ruined a positive perception of e-books by selling so many bad ones (ugh, I bought some too) leaving a bad taste in people's mouths when they see “e-book.”

Hopefully the perception will change to convenience of real-time reading and cost-effectiveness for valuable content.” (yes, the content must be valuable, imagine that?).
http://nathanhangen.com/blog Nathan Hangen

Great point, in fact Mike and I are set on doing this…have no idea how to get on Audible though…something to look in to.
http://nathanhangen.com/blog Nathan Hangen

We're always willing to open our doors and windows for you. @nhangen and @mikecj

Feel free to say hello and we'll do our best to earn your trust. It can't always be done in under 5 minutes, and we get that, but you'd be amazed by how hard it is to break through in a game where there are so many guys that kick ass already (like Chris).
http://blog.criticalresults.com/ Mark W. Schumann

“Complainers and layabouts” reminds me of a guy who used to be on the mailing list for the Clipper (!) user group I adminned years ago. He used to say that the user group is “like the AMA,”–they don't want to share knowledge and let people compete with them.

Holy Carp that was weird. Dude never came to a meeting, even though the meetings were FULL of really good how-to presentations and very helpful Q&A sessions. Nobody was holding back. All you had to do was show up and ask a question now and then.

But no. It was easier to sit back and talk about being kept out of this cabal that didn't exist. And that was for something free!

Long story short, I think even when stuff is free, some people are never happy.
http://LisaMorosky.com Lisa Morosky

First of all, I think there's a big difference between “Beyond Blogging” and other interview type products I've seen. The difference is that Mike and Nathan tie it together at the end. You hear from the pros, then you get a condensed version to put into action. That, to me, demonstrates that they know their audience – people who want proven, actionable items, in an easy to digest format, and a 1, 2, 3 approach to turning your blog into a business. Why do people fail in this industry? Because they A. don't take action and B. get information overload and become paralyzed. I think “Beyond Blogging” has done a great job at trying to help people avoid those common pitfalls.

And I'd tend to agree with those who say that if you look at the price and say “Uhh, no way.”, then you're not the target audience for the product. The target audience will focus on the benefits and the takeaways, not the price.
http://andydolph.com Andy Dolph

when you do, I'll be first in line…. it doesn't have to be on Audible – I'm perfectly happy with mp3 downloads…. but if you could get on Audible it'd be cool….

andy
http://nathanhangen.com/blog Nathan Hangen

Sure thing, check the blog http://beyond-blogging.net from time to time and we'll let you know when it's ready. Thanks Andy.
http://www.mikeslife.org Mike CJ

I took a few moments today to check out OS Commerce and it looks good, and could have been adapted for the job we needed, although I'm not a fan of “adapting” things, maybe because I'm not very techie!

I would say this – given the incredible volume of traffic we've had, I'm very happy the payment system was not on our server! And with the inevitable Credit card glitches and mistakes people make, Nathan was very happy with the support from 1SC. So, I'm happy we used them, and wouldn't hesitate to recommend them to anyone else.

Finally, I take your point about the website, but I'm guessing you were on the sales page. If you check out the site itself, you'll find a lot more information on there.
Anonymous

It’s an investment and if you need a hard copy there is always Staples Copy Center make sure you ask for it to be on both sides.

http://chrisbrogan.com Chris Brogan

You’ve got it right, Michael. : )

http://nathanhangen.com/blog Nathan Hangen

There are people like you that are OK with short sales pages, but then there are still those that print them out and read every word. It's tough to cater to both, but we tried. that's why there is an order button right off the bat?
http://nathanhangen.com/blog Nathan Hangen

1SC costs over 1k per year, so it's not like we didn't invest. Yes, we could have paid for an in-house solution, but then you'd be complaining that we charged more.

I can list dozens of people you know (and probably trust) that use it, but something tells me we're just being picky here.
christinakatz

I'm not saying that the marketing isn't “cool.” I'm saying it's predatory and definitely not based on trust, which I believe is your trademark.

I hear that you are saying it wasn't your marketing choice but all of you pros who signed on with these guys are now going wherever they are going. And as a fan, I'm disappointed.

Also, I know you are an A-list blogger and I know you are working on a lot of things but when you use phrases like “yellow highlighter marketing” or “cumbaya crowd of social marketing” in reference to something I've just said, it rubs me the wrong way. I'm not “in your third tribe theory” — I'm a person who doesn't like to be labeled while my air bubble is still hanging in the air.

But if you sense that I am taking a firm stance in the middle than you are correct, sir. And I plan to stay here, which means: no informercials. And that's too bad b/c I'll miss out on what is likely a good read.
christinakatz

I followed you guys on Twitter but as I said to Chris, I'm disappointed at your marketing tactics. There's not an ounce of trust in them, so that's already created an elephant in the trust room, if you know what I mean. And I hope you are not expecting sympathy for hard work. I've been doing it for ten years too, as I'm sure everyone here has, as well.
http://nathanhangen.com/blog Nathan Hangen

Well, I'm sorry you feel that way, but if you look at the Twitter stream, you'll have a hard time finding a neg comment from anyone that has purchased. I guess it creates an elephant in your mind, but to many others…it didn't.

Again, as I asked someone earlier, I'd like you to point me to a product you think markets differently. We're always open to change.

Sympathy, no. It sounds like you know what people are up against trying to earn trust…we just want a fair shake :)
http://nathanhangen.com/blog Nathan Hangen

Predatory how exactly?
christinakatz

Predatory as in focusing on wearing down folk's resistance to reach for their credit cards instead of relying on genuine word of mouth.
christinakatz

Are you serious? If I look at the Twitter stream that will prove to me that you guys are really nice guys who deserve the four hour workweek? You're going to have to do better than that, at least for a shrewd customer like me.

Sure. I can steer you directly to a product that is marketed differently. How about Trust Agents? And I doubt you are open to changing your tactics because you just said you are going to do whatever gets sales.

And finally, and this is it for today for me, why would I or anyone possibly have any sympathy for you?

Why in the world would you not have as fair of a shake as does anyone else who has worked as hard as Chris has or the other folks you are packaging for that matter?

I don't even know who you are and yet you think I should be studying your Twitter stream and finding out what great, deserving guys you are?

Seriously? Come on.

This isn't merely about the price point. It's about trusting the publishers.

So far, no dice.

You say, Why not blog and grow rich? in your sales pitch.

This is why not.

And by the way, I'm still a fan of Chris and Gary. I'm just not a fan of this.
http://www.mikeslife.org Mike CJ

I'm struggling with the whole concept of “Marketing tactics” here to be honest Christina.

Here's the story – we're two bloggers who have worked hard on our blogs for a year or two. In that time we've built trust within our own reasonably large communities, as most bloggers do. I guess it would be fair to say we've been moderately successful at that.

We had an idea to write a book. We approached the top names in blogging. They very kindly agreed to help. We wrote the book, over several months. We decided on a price and designed a website and sales page to sell it from. We then spoke to the top names and asked them if they would be willing to promote the book in return for a commission – we sent them each a copy of it at that time. Now I guess you'd call that a marketing tactic, but it's both a common and legitimate one. And don't imagine for a minute that any of them would have agreed to promote the book if they thought it was rubbish.

This is business Christina – this is us selling our writing, earning some payback for months of hard work, and Chris getting a share of it for his input and for being kind enough to bring it to the attention of his audience.

Nobody is being duped here – Chris has disclosed he's getting a commission and you know how much we are charging for the book. We may even make a profit.

You don't have to buy it, you don't have to even like it, but this has been an honest endeavour from start to finish.

Perhaps I'm being overly sensitive, but I'm astonished to see a phrase like “predatory” marketing against my name, as that's so far removed from who I am, and try as I might, I can't see it. I can't see it in the website for the book, the sales page for it, or in having people like Chris promote it, having reviewed the book, and then disclosing their interest.

I've had two long days, perhaps I am being over sensitive…..
http://nathanhangen.com/blog Nathan Hangen

4 hour workweek? I wish! I work a lot, but I choose to…it's my hobby.

I was actually referring to the Tweets about people that read and enjoyed the book.

Again, I don't want to take Chris' blog hostage…I've already gone well past my welcome, but…Trust Agents is built on 11 years of Chris giving away for free…he deserved to sell it for 100 bucks if you ask me. Chris still got crap for posting about it.

I think there was a misunderstanding about the Twitter thing…I'm not great…I'm just a guy that was lucky enough to pick a few brains and write about it. I'm not the story, those guys/gals are.

Read my blog, read Mike's. That's all I can point you to in order to build your trust. I can assure you, Mike and I aren't getting rich off this book, regardless of what you might think.

The Old Value-Cost Conversation

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