It’s time to make a decision: how much will you charge for your online course?
If you’re like a lot of course creators, the mental chatter around your decision probably sounds something like this:
Okay, self. I’ve put it off for long enough. It’s time to decide how much to charge for my course.
But wait. I’m sure there’s something else I still have to do before I have to decide…
No? Hmm… okay. Here goes. I guess.
How much money do I want to make from course sales? A lot, obviously. So I should charge a premium price for my course!
But what if my audience isn’t willing to pay that much? Maybe I should charge less than my competitors, so I’m the obvious choice.
But that means I’ll need to get SO MANY students to make my income goals.
But what if…
Cue the endless cycle of “but” and “what if” as you try to choose the perfect price for your course.
Before you end up in a pricing spiral that leaves your head spinning, let’s get one thing out of the way: there is no such thing as the perfect price for your course.
Instead, there’s the right price for your audience, right now.
This post will help you figure out how to price your online course, so you can get on with selling it!
Here’s what this post covers:
This Post at a Glance
- The Psychology of Online Course Pricing
- Pricing Your Online Course: 2 Simple Steps to Financial Success
- 5 Ways to Make Your Course Even More Valuable (So You Can Charge More)
- How to Test Your Online Course Pricing
- Priced for Online Course Success
Before you begin, it’s good to understand the tiers of online course pricing. Every course out there fits into one of the following categories:
Free courses are everywhere. From desperate new course creators begging people to take their courses to more advanced businesses using them as lead generation, it’s hard to go anywhere on the internet without running across one.
Paid courses are also pervasive. From low-priced courses on Udemy to premium learning experiences hosted on fancy LMS systems, you probably know someone offering paid online courses.
Subscription model courses are becoming more common, where course creators offer one or all of their courses on an ongoing basis. Sometimes this means new content is added regularly, or additional access is offered as part of the subscription. Either way, you’re paying a set fee every month to retain access to the course content.
Now it’s time to dive in and tackle the first big roadblock most course creators face when choosing their online course pricing: the mental game.
The Psychology of Online Course Pricing
It’s common: the mental hoops you jump through as you try to decide what to charge for your online course. Whether you’re suffering from imposter syndrome, general uncertainty, or something else, your brain and ego can make the entire process harder than it should be.
Here are some popular objections to charging what you’re worth:
“I’m not enough of an expert. [Competitor] has more experience than I do.”
“My course doesn’t deliver tangible results, so how can I charge for transformation?”
“Most of my competitors are teaching [subject] for less.”
“My audience can’t afford this.” Or, “My audience will never pay that much!”
“People can just hop on Google and learn about [subject] on their own.”
While there may be some truth to any of these statements, none of them are good reasons to charge less than your course is worth.
Good online courses are valuable. Period.
Unlike the days when ambitious marketers would dump a bunch of information into PDFs or videos in a member’s area and leave you to fend for yourself, good online education brings about results. And people are happy to pay for results.
Let’s also take a look at the “people can just Google it” argument. While this statement is true, there are three types of consumers, and only one of them wants to go through the trouble to do it themselves.
These are the three main types of online learners:
1. People who are willing to take the time to search Google, sift through a mountain of free online resources, and figure it out themselves. These people are not your ideal students.
2. People who buy a bunch of inexpensive courses they never finish, and then complain about not getting results. These people are also not your ideal students.
3. People who are willing to pay a good price to learn from an expert teacher. These people are willing to invest in a high quality solution to their problems. These are your ideal students!
If you’re still not convinced, let’s talk about the problems you might encounter if you decide to charge too little for your course.
Penny-Pinchers Don’t Prosper
Remember those people who buy inexpensive courses, don’t take action, and then complain about not getting results? They’re not the only problem with cheap online courses.
Competing on price, in any industry, is usually a race to the bottom. Slashing prices can only take you so far, and often leads to additional problems.
Think about discount stores — you don’t usually equate luxury or high quality with the products you get from those kinds of stores. The same goes with online courses. Not charging enough can cause future students to think your course is both low quality and low value.
If your course isn’t profitable you can’t afford to advertise it. And, the likelihood that JV partners will want to collaborate with you is slim to none.
Plus, when it’s time to sell your course, it takes just as much effort to sell a low-priced course as it does to sell a high-priced one. Why not make that effort worth your time?
But before you start to think there’s no place for low priced courses, there are a few times when it makes sense to give away your course for free.
- For lead generation — if you have multiple offerings, it can make sense to use a free course at the top of your funnel, to get people on your list and familiar with your work.
- As a bonus resource — if someone has purchased one of your higher-priced offerings, a free course can be an attractive added bonus.
- As part of customer onboarding — if your product or service involves learning how to use a new tool, you might offer a free course to help your customers ease the learning curve.
Hopefully by this point you’re ready to charge what you’re worth. Let’s look at the benefits of doing just that.
The Perks of Proper Pricing
Now that we’ve walked through the pitfalls of not charging enough, let’s quickly touch on the benefits of charging more for your online course.
When people pay a premium for something – whether it’s a course, a product, or an experience – they tend to value their purchase more.
At a higher price point, your enrollment is likely to be lower. And because you can then give each student more individual attention, they will have a better educational experience. Students are more likely to finish your course, take action, and achieve the results your course promises.
Happy customers leads to referrals leads to more happy customers… and the cycle grows from there.
If that’s not enough motivation to get you charging more for your course, let’s look at a few additional benefits.
When you don’t compete on price, it allows you to market based on the value of your course results. The perceived value of your course is raised by the higher price, and you can afford to take better care of your students, which leads to better results. And to a higher likelihood that you’ll meet your revenue goals.
If you want to bring on JV partners, a percentage-based cut of a higher priced course is a more attractive proposition. And you can afford to pay more to advertise your course, if you want to bring in additional students who aren’t on your mailing list.
Next, with the psychology of pricing out of the way, let’s walk through the steps to choose the right price for your online course.
Pricing Your Online Course: 2 Simple Steps to Financial Success
One of the most important things to keep in mind as you start your pricing journey is to be clear about your strategy.
Focus on what you want to achieve. What is your goal for your courses?
This might mean both your income goals and the goals you have for your students. What kind of transformation can you offer them? And what outcomes can they achieve by completing your course?
First, let’s take a look at your income goals.
For some easy “back of the napkin” math, think about the number of students you can reasonably enroll (and support) in your course at one time, and how many times you will run your course. Take this number, and multiply it by the per-student course price you’d like to charge.
To make this math even easier (and maybe even fun!), we put together a pricing calculator you can use to play around with the numbers. Change up the number of students in your course, the price, the enrollments… and see what happens! Cha-ching!
When choosing your per-student course price, there are a few considerations that will help you make your decision.
Step One: Choose Your PRICE
There are five key factors that influence how much to charge for your course.
P is for Personalized Support
Providing individualized support takes time and energy. Plus, it’s not easily scalable, which makes it valuable.
Ask yourself: how much individual support do your students need to achieve the promised result? Will it be a high amount or a lower amount?
- Higher end — Lots of one-on-one interaction and personalized coaching.
- Lower end — Group calls and some email support.
Typically, the more support you offer, the higher the price you can charge.
R is for Results Achieved
Your course addresses a real and pressing problem or desire for your audience. But some topics are, by nature, more pressing than others.
Think about the benefits your students get, rather than the features you want to offer. Work backwards from the value your course will deliver — figure out all of the positive outcomes, and then put a price tag on them.
Ask yourself: how substantial are the results your students will achieve? What impact or transformation will occur in their lives? Will it be on the high end, with a dramatic impact on the student’s quality of life? Or on the lower end, with something valuable but less essential?
- Higher end — Curing someone’s insomnia or securing them a $10,000 raise.
- Lower end — Helping them choose a personal fashion style or improving their golf game.
Typically, the more dramatic the transformation, the higher the price you can charge.
I is for Industry Research
Go back to any competitor research you did when you initially created your course, and examine the range of prices others in the industry are charging. This can be a good indicator of the prices your market is willing and able to pay to solve this particular problem.
Are others in your industry charging a high amount for their courses and training? Or are they offering shorter or less in-depth courses for a lower price?
- Higher end — A $25,000 interior design program that includes online lessons, group calls, downloadable design sketches, and a one-on-one consultation.
- Lower end — A $497 online fitness course for people who suffer from back pain that includes pre-recorded video lessons and email-only support.
Industry prices are good indicators of the range you will be able to charge. That being said, you don’t have to choose your course price based on the price your competitors are charging.
Instead, use price anchoring to influence the perceived value of your course, or increase the value of your offering (more on this in a moment) to match a higher price point.
C is for Course Price
This category mainly applies if you are deciding what price to charge for a pilot course — where you are testing out whether your course idea is viable before you build out a full course.
If you are running a pilot, consider what you might charge for a full course after completing your pilot. You don’t have to know exactly what your full course will look like. Just take a guess at what the range might be. What percentage of your overall course are you teaching in the pilot?
Do you foresee your course at a high price point, or a lower amount?
- Higher end — a $1,997 course that includes online video lessons, with one-one-one calls as well as group coaching, and downloadable resources.
- Lower end — a $497 course with no added support.
Considering the range where you might price your full course can help determine your pilot pricing. And if you already ran a pilot, you can use the pilot pricing to help anchor the price for your full course.
E is for Experience and Expertise
Next, consider the level of experience and expertise you bring to the table, as well as any social proof of the results you help your students achieve.
Do you have a high level of experience, expertise, and proof in your industry? Or are you new to the industry, and/or have less expertise than your direct competitors?
- Higher end — Advanced degrees, certifications, a published book, an established track record, and lots of case studies, success stories, and testimonials.
- Lower end — A passion for the topic and self-guided research.
Typically, the more experience, expertise, and proof you have, the more you can charge.
Next, rank each of the five categories as “high” or “low.” You might also choose to add a “medium” option, for any categories where your course falls in the middle of the range.
Looking at those answers, decide what price makes the most sense for you. There’s no exact formula, but use the following as a guide:
— If you answered all “low” to each of the categories, consider keeping your course price to the lower end of the market range.
— If you answered somewhere in the middle, you can price your course toward the middle of the range.
— And if you answered all or mostly “high” to each category, you can consider charging a premium for your course.
Now that you know the PRICE factors, let’s move on to the next step.
Step Two: Hit Your Pricing Target
Maybe by now you’re clear on what range of prices you could charge for your online course. But how do you decide exactly what price to charge?
Enter… the Color of Money.
No, not the 1986 Scorsese film starring Paul Newman and Tom Cruise. 😉
But rather, a consumer behavior theory based on the Marshallian Economics theory, hypothesizing that the more a product costs, the fewer people will buy it. But that’s not the whole story — the key is, the decline in sales isn’t linear and instead happens in tiers.
What does that mean in plain English?
Basically, there are pricing thresholds that psychologically impact your potential customers.
While you’ll make roughly the same number of sales within each tier, once you raise your price past the threshold into a new tier, your sales will tend to drop significantly.
There are five basic price tiers recommended by this theory:
For example, if you were thinking about charging $300 for your course, you might choose to:
- Raise your price to $497, because you won’t lose a significant number of sales by doing so; or,
- Lower your price to $197, potentially gaining quite a bit more sales.
Now, this doesn’t mean you can just raise your price if your offer isn’t worth it. In this case, you would increase the value to justify the price.Want to charge more for your online course? Here are 5 ways to make your online course even more valuable!Click To Tweet
There are a number of things you can do to increase the value of what you’re offering. Let’s take a look at how.
5 Ways to Make Your Course Even More Valuable (So You Can Charge More)
There’s a reason so much of this post has focused on psychology. It’s not just you, or your potential students — the entire marketing and sales process is influenced by how people think and make decisions.
Pricing is perception.
And when you want to increase the value of your online course, it all comes back to psychology.
The first two suggestions aren’t things that you necessarily need to change. Instead, they are ways you can position your course to appeal to your ideal audience — increasing the perceived value.
1. Be Specific
One of the keys to finding a profitable online course idea is to be clear and specific.
When you get really specific, you give your audience the chance to tell you whether your course is right for them.
In the same way, when you’re focused on increasing the value of your course, specificity is key. When you understand the exact problem or desire your audience has, you can position your course as the perfect answer.
They have a problem. You have the best solution. Simple.
2. Be Unique
Often, being super-specific can be enough to set your course apart.
But you can also go the extra mile and determine what’s distinctive or exclusive about the way your course will help students.
Is there a way you can reframe, reconfigure, or otherwise switch around the way you talk about your course to stand out from the crowd? What’s your unique selling proposition?
Next, let’s take a look at what you can add or change to increase the by-the-numbers value of your online course.
3. Be Accessible
As an expert, access to you is one of the most valuable things your students can receive.
There are supplemental offerings you can build in to the student learning experience, to give them additional access to you.
Let’s take a look at three options, from least to most time consuming:
- Private Groups — Many online courses offer a private Facebook group where students can interact, ask each other questions, share their experiences, and interact with the instructor. As long as these groups are moderated and active, this can be a good way to add value to your course. (And while Facebook is most often used for this purpose, you can also choose another platform.)
- Group Coaching — Offering a high level of value while also balancing out the amount of time you have to actively spend interacting with your students, group coaching can be a win-win for both you and your students. Whether weekly, bi-weekly, or monthly, these live calls can be where your students ask you questions and everyone gets the benefit of your answers.
- One-on-One Coaching and Consulting — While offering individual coaching or consulting can take a decent amount of your time, you can significantly bump up your course price by offering this opportunity. Your students get advice that is specifically tailored to their situation, helping them to achieve their desired outcome more quickly or easily.
There are also additional ways to share more of yourself and your expertise, without spending extra time with your students.
4. Be Generous
You can offer bonuses and downloadable resources to add value to your course.
For example, ask yourself the following questions:
- Do you have a free course that would be beneficial for your students?
- Is there “extra” material that would allow your students to go deeper into the course topic?
- Are there related exercises or homework assignments you can include along with the core course material?
- Can you offer a certificate of completion?
And remember, there is no single customer for your offerings.
5. Be Flexible
Some potential students are looking for more value than others, and some are willing to pay higher prices to get additional value.
To make the most of the full potential of your course offering, you might consider providing multiple price points.
- Basic Version — Includes video content and all downloadable course materials.
- Upgraded Version — Includes everything in Basic, plus weekly group coaching.
- Premium Version — Includes everything in Basic + Upgraded, plus one-on-one coaching.
You might also consider offering a payment plan, where the single pay option is slightly less expensive. Your students can save money by paying in one lump sum, or they can opt for a 3-month, 6-month, or 12-month payment plan to help them afford the payments.
Now that you’ve figured out exactly what to charge for your online course, it’s time to get some real world feedback.
How to Test Your Online Course Pricing
The final step in choosing the price for your online course is to try it out!
This may sound intimidating, but if you’ve followed the steps outlined in this post, chances are you have a great starting place. Pick the price that makes sense based on this post, and see what happens.
Like most things in business, you won’t know until you try. And once you have data on what works and what doesn’t, you’ll be in a much better position to change things.
If you’re not confident about your pricing, you can try a pre-launch campaign to take away the guesswork. If you haven’t done a pilot of your course, we highly recommend going through the piloting process before attempting a full course launch.
Something to remember: course pricing isn’t “set it and forget it.” Keep testing the price regularly. And keep an eye on your data points any time you test so you don’t get caught off guard as the market moves and shifts.
Finally, the time has arrived. Time to get your online course out into the world!
Priced for Online Course Success
Now, when it comes time to price your online course, the story inside your head can sound more like this:
Okay self. We have a great course to sell, that our audience is excited to buy. Let’s decide what price to charge, and make some sales!
Sounds a lot better, right?
By following the steps in this post, you get to bypass the mental bickering and choose the right price for your course… right now.
And don’t forget, you can make the math simple by using our Online Course Pricing Calculator. Check it out for free!