Incremental Price Testing

A discussion about pricing strategies for digital products, focusing on how to balance value and accessibility while maximizing revenue.

Core Pricing Approaches

• Ultra-free vs Ultra-premium strategy (Tim Ferriss model)

  • Give away 99% of content for free
  • Charge premium prices for exclusive offerings
  • Builds large audience through free content
  • Monetizes through high-ticket items ($10k+ workshops)

• Tiered Pricing Strategy (Steph Smith model)

  • Start at low price point ($10)
  • Increase price every 30-50 sales
  • Creates urgency and rewards early adopters
  • Helps find optimal price point naturally

Key Considerations for Digital Products

• Value Perception

  • Price low enough that people are happy with purchase
  • High enough to be taken seriously
  • Should encourage sharing and word-of-mouth
  • Must exceed expectations at whatever price point

• Customer Service Impact

  • Lower prices generally mean less customer service needed
  • Product should "run itself" and "market itself"
  • Avoid pricing that requires heavy support

• Long-term Strategy

  • Consider using products as "honey pots" to attract ideal customers
  • Build community and network effects
  • Can lead to bigger opportunities later
  • Value might come from connections rather than direct sales

Monetization Tips

• Focus on either mass market (low price) or luxury market (premium price)
• Avoid middle ground pricing
• Consider giving away valuable content to build audience
• Save premium pricing for unique, high-value offerings
• Use pricing to filter for ideal customers
• Think about long-term value beyond immediate revenue