As an online instructor with Udemy, you are a pioneer on the leading edge of education, but one of the challenges of being a pioneer is the best road has yet to be clearly marked. Choosing the right price point is the most common question instructors ask, and the most challenging to answer because frankly, there isn’t just one “right” price. But there are some guidelines that can help you find that perfect price point for your course an ensure you are maximizing your return.
Look at Your competition:
Udemy is a curated marketplace, which cumulatively acts as a magnet drawing potential subscribers to your course, but it also means your course will appear right next to courses on the same or similar topics. When you price your course, you need to be market-aware. That does not mean you have to start a price war, but it does mean you are in line with the other courses in your space.
Typically, online courses are priced at $10 to $30 for every hour of content (so a 10 hour course will be between $100 & $300). You’ll often see that courses in a shared space tend have a similar price point per hour. If that’s the case for your subject, then you can quickly calculate a competitive price for your course. If you do choose to deviate from that price point, then pay extra attention to the next element, which becomes that much more critical.
Perceived value is what someone thinks your course is worth, and how you position your course can influence that perception. Take these two examples: “Learn Excel Pivot Tables” or “Learn How Pivot Tables Help you Get A Raise”
There is a much higher perceived value in the second course than in the first. The same is true for the type of content in a course. The perceived value of a 5 hour course that’s well organized and produced, includes sample files, exercises, a snappy intro video and active student interaction, will have a higher perceived value than a 10 hour course without those elements.
You are the first judge of what your course is worth, but unfortunately, your vote doesn’t count for much. Hence the need for the final piece of the pricing puzzle
Test the Demand Curve:
Think of defining the demand curve for your course like trying to determine the dimensions of a room without turning on the lights. You don’t need to explore every inch of the room to know how big it is. Instead, you can find how far apart the walls are and extrapolate. It is is a controlled trial and error process. Notice from the graph on the right: At $100, only 10 people bought the course. At $50, 20 people bought the course. Both price points yield $1000 in total sales (and at $80 and 12 people, it’s a little less). However it at $70, we see 15 sales, or $1050. Only by gathering these different data points can you start to define the demand curve and identify the best price for your course.
In practical terms, this means creating A/B tests in which you make coupons with different discounts for your course and send them to two sets of people to see how they perform. It may take a few weeks, even a month or two, to define your demand curve and find the perfect price for your course, but once you do, you can be confident you are maximizing your potential return. Science.