How to Price an Online Course: Step-By-Step Guide (2023)
Did you know that one of the most expensive Executive MBAs available costs $223,500 for a two-year course?
Pricing is a significant factor when selling education.
If you’ve gone through the trouble of creating an online course, the last thing you want to do is price it too high and lose out on potential customers who might shrug it off as too expensive.
At the same time, you don’t want to go too low and leave money on the table.
So how should you determine a fair price for your online course before starting to market it?
In this article, I’ll provide tips for pricing your online course so you can make the most of your knowledge and expertise while helping people achieve their goals.
Here are the various factors to consider when pricing an online course.
The first step towards crafting a successful pricing strategy for your online course is research.
When setting pricing strategies for courses or services, it’s essential to consider how much value they offer compared to similar ones in the marketplace.
It is vital to research what other instructors in your field are charging for their courses.
You could even conduct a simple Google search if your course is slightly “off the beaten path” and doesn’t fit within more prominent industries like health, wealth, and relationships.
As you do your research, consider that pricing an online course takes careful consideration as it impacts marketing strategy.
With this method, you might be unable to factor in all the factors other publishers have had to go through.
That said, combining what others are charging with an online course pricing calculator can help you determine the right ballpark for your pricing.
Gathering this information before deciding on a price tag will ensure that you are well-informed when it comes time to decide on the final cost of your online course.
Another important factor when determining your course’s pricing is understanding the customer’s perspective.
Here are some questions to answer:
- What value does this course provide?
- What benefits will they get from taking it?
- Will it help them land their dream job?
- Will it help them start their own business?
Once you understand the value that your online course provides potential customers, you can start thinking about how much they would be willing to pay for that value.
Another excellent way to do this is to reach out to potential students through a Facebook group related to your niche.
Over there, you can ask what they think a fair price for a course with your specific aims would be.
Consider interactive elements of your course, such as Q&A sessions or video conference calls with the instructor, when placing your question.
This research can also provide additional value for customers so you can charge more for the course.
Another online course cost consideration revolves around marketing and promoting your course.
Marketing for an online course can be time-consuming and expensive, depending on how you decide to promote it.
Whether you decide to pay this expense with your time (such as using cold emailing marketing tactics, cold calling, and other outbound marketing tactics) or with your money (such as using paid ads or paying influencers), this is a cost you must pay.
As such, you must consider any marketing-related costs associated with making your online course known.
Moreover, consider the cost of using marketing automation tools, as these can add up if they are on a subscription pricing model.
Even if you plan on doing all the marketing yourself, there are still costs involved with creating promotional materials and advertising campaigns.
These costs should affect how much you price your online course.
When pricing your online course, consider who you are targeting and their level of knowledge around the given subject.
If you’re targeting beginners just starting their journey in a particular field, they might only want to spend a little money to learn something they’re just getting into.
On the other hand, if you create more advanced courses for experienced professionals looking for ways to move up in their industry, higher prices may be acceptable and even expected.
These people might already be familiar with the field and have seen results from past investments.
Moreover, determining the target number of students at the required skill level is also a good idea.
As a result, you’ll have a clearer picture of what it takes to cover your investment in creating the course and be able to use this knowledge to set an appropriate price point.
Creating a successful online course requires learners to take out their wallets and commit to purchasing.
Not everyone will want to use the same payment methods, so consider offering alternative payment options to incentivize your students.
First, different payment processors come with various fees and terms, so research each to ensure that you choose the best one for your business.
Moreover, offering students alternative payment options such as installments or tiered fees can encourage maximum enrollment in your online course without compromising quality.
Offering flexible payment plans also allows students with limited budgets or financial restrictions greater access to high-quality education opportunities.
This payment type could lead to increased engagement from prospective customers, whereas an intimidating upfront fee might otherwise deter them.
When setting the right price for your online course, consider adding extras such as videos, workbooks, or templates as part of a higher-value package that will justify increased costs.
This additional content will give students extra resources and materials that provide even more value and ensure they get everything they need from your course.
In addition, extra materials make learning easier for potential students since everyone’s learning styles vary.
Establishing Credibility And Recognition
It’s essential to establish credibility and recognition among your target audience to succeed in your market.
You can do this through credentials, awards, testimonials, and other forms of external validation.
Plus, providing valuable free content goes a long way to building trust with potential new customers.
The more you can build on these factors, the more you can charge a high price.
Let’s explore some of these factors in more detail.
It’s easier for customers to trust you if you have external validation or third-party endorsement.
Make sure to include awards from industry experts or professional certifications demonstrating your field expertise on your sales page.
It also helps to have customer reviews or testimonials that show people are willing to vouch for your services or digital products.
If you’re looking to set a higher price point than the competition, having these validations can help justify the increased cost.
Providing valuable free course content is excellent for building trust with potential customers.
During pre-launch, having a step-by-step series of informative emails or blog posts can be a great way to create momentum and anticipation for your upcoming course.
Once you’ve launched, ensure you keep writing blog posts, creating videos, hosting webinars, or other content that can help educate potential customers on the subject.
Most course creators think their work is done once launched, but this isn’t the case.
Any valuable content you create will show users that you know what you’re talking about and are willing to help them.
Moreover, take advantage of social media platforms like Twitter, Instagram, and Facebook (or whatever platform makes sense for your online business).
Using these platforms, people can get an idea of who you are and the value you provide before purchasing or signing up for your course.
Many online course creators need to consider the idea of charging premium prices.
However, higher-priced courses and group coaching sessions could be the only way to help your target market.
Higher prices can help you reach revenue goals quickly and efficiently and provide an enhanced learning experience tailored to each student.
When you charge a premium for your course (this also applies if you start a coaching business), it communicates that the program is high quality and worth paying more for.
It also sets expectations upfront to clarify what your customers will receive in return for their purchase.
The beauty of charging a premium price is that it filters out people who need to be more committed to learning the material in your program.
Since you’re asking them to invest more money upfront, they are more incentivized to follow through with their purchase and participate in the course or coaching program.
As a result, there’ll be less time spent trying to manage students who aren’t getting results because they need to take the material seriously in the first place.
As you can see, the higher the pricing, the fewer problems there’ll be for you and the higher probability your students will see desired results.
That said, ensuring your course is of the highest quality should be the baseline from which you operate.
Offering tiered pricing with bonus content is a great way to entice customers to invest in your course.
Consider offering three pricing tiers; “basic,” “standard,” and “premium.”
Each tier will offer varying content levels for each customer.
The premium tier might include additional bonuses that appeal to those taking your system.
Whether that means having editable worksheets that break down complex processes or one-on-one coaching via virtual meetings depends on the type of course you offer.
Irrespective of what’s in each plan, customers get more flexibility in their decision-making process, which can boost sales.
The right online course platform can help you set up these tiers if you’re on your first online course setup.
At this point, you might think it’s daunting to settle on a final price for your course.
However, multiple strategies mean that the more you test, the closer you are to finding what works for your situation.
By experimenting with different approaches and testing different prices against each other, online course business owners can hone in on the perfect price point in a much more straightforward way.
This kind of experimentation also allows course creators to make informed decisions about pricing – rather than relying on guesswork or just following what everyone else is doing.
Here are a few other ways to provide high value through your course and make it more attractive to potential customers.
The benefits of course creation do not have to stop when someone finishes consuming your content.
Creating a community space where potential students or participants can connect and share their experiences is another way to increase the value of your courses.
People love being part of a community where they feel listened to and valued.
Improving production quality is always a good idea.
You don’t have to break the bank either to maximize the value of your courses.
Investing in the right equipment or tools can be relatively inexpensive.
Moreover, as online course sales continue to increase, it’s also a good idea to reinvest some of that money in the course and up your production level with new equipment.
It would help if you also strived to keep up with market trends in all aspects of your course, adding modules as necessary.
Bundling different products together can give customers more bang for their buck while still allowing you to maintain a reasonable profit margin on each sale.
For example, creating an online masterclass with an in-depth course series, ebook, and a bonus coaching session can attract more customers than just having online videos.
When pricing an online course, think of upsell opportunities that you can add to increase the overall value of your system and have increasing price points.
Creating an incentive for people interested in purchasing more than one product at once increased your course’s overall value.
It also makes it more attractive to a broader audience.
The most significant benefit is that your sales message will be able to target the immediate problems you’ll address through your course and provide additional long-term value with follow-up services or products.
Finally, being honest about your course’s value might be the best way to provide the correct value.
You want people who purchase your online course to feel like they got more value than the price they paid.
Providing people with clear expectations will ensure they get their money’s worth and are satisfied with their purchase.
One way to do this is to provide accurate descriptions and information about the course topic covered in each class.
Let’s now consider the pricing question from the other end of the spectrum and assume you charge less than the industry standard for your course.
Many might assume that your course contains outdated content that may need more relevancy or provide little practical value for its students.
This belief might stem from potential students’ experiences.
Often they might have gone through courses that needed more detailed information and resources for students to apply what they learned from the system.
Additionally, such courses might have contained generic content.
Finally, some low price options may not even be created by authoritative figures in their respective fields but by non-experts trying to make a quick buck off unsuspecting buyers.
However, there are times when a lower cost could bring more benefits than a higher-priced course.
For example, if you’re looking to build an email marketing list from scratch or attract customers to a newly-launched business in an up-and-coming niche, offering a lower-priced version of your course is one way to do that.
It also works well if you’re trying to bring in customers that wouldn’t usually pay the total price because they have yet to learn or trust you.
A lower price can also help if you’re trying to broaden the appeal of your course by making it accessible to those who may not have the budget for a more expensive option.
Finally, lowering the cost gives people a more accessible entry point into your product line, which means they may be more likely to upgrade after experiencing what your products offer.
Despite the potential upsides, I advise you to consider pricing your course too low, as this could backfire on you as the product owner.
Here are a few other ways to help make sure your course sells.
Pre-selling refers to introducing your course idea and offering potential buyers a chance to pre-order or reserve their spot before you officially launch the course.
Pre selling courses generally includes releasing different levels of information about your course over the weeks before launching.
When it comes to course sales, pre-selling is a great way to gauge interest in your course, build trust and excitement amongst potential buyers, and create a sense of urgency before the official launch occurs.
Creating mini-course previews or sample materials and sending a message to your email list can help your warm audience understand what they’ll get for their money.
Using the concept of scarcity, your pre-launch activities should also include offering discounts or bonuses for a limited amount of time and to a set number of people.
Another effective way to get people to buy your online course is setting deadlines, after which prices will increase.
Deadlines incentivize urgency in customers, getting them to act in the moment rather than wait until later.
It also helps ensure that customers don’t devalue the perceived value of your product by reducing prices too low.
For online course creators, offering free courses can be an invaluable tool for growing your business.
It’s a great way to draw in potential customers and build trust with them with the quality of your free content.
The main reason this approach is practical is that it allows you to showcase your knowledge and expertise without offering any financial risk on the part of the customer.
You allow potential customers to explore what you offer before committing financially.
By providing some of your content for free, you open yourself up to various benefits like:
- increased traffic
- lower-cost marketing campaigns
- better lead generation strategies
- improved customer engagement
- higher conversion rates
- more loyal customers overall
- and more.
When it comes to pricing, everyone has a point in mind where they’ll take action, i.e., buy.
Known as the “psychological tipping point,” this is the sweet spot where customers will be willing to pay the price without feeling as if they are overpaying.
Hitting this sweet spot requires a combination of data points such as market positioning, competitive comparisons, historical trends, and customer feedback.
These elements work together to determine the optimal price for your product or service that will attract buyers without compromising quality or perceived worth.
Offering high-quality content is challenging, as it requires hard work and dedication on behalf of course creators.
However, if done right, it can bring huge returns while allowing potential students to reach this tipping point even quicker.
By understanding the psychology behind pricing, course creators can ensure they set their prices correctly and effectively grow their businesses.
An online course business can be lucrative, but its success starts with understanding the psychology behind pricing and how to set your prices properly.
Knowing how to sell online courses means having a course idea that appeals to potential customers.
Then, you must be able to offer high-quality content at a cost that’s less than the value students would derive from paying it.
Using the above tips, you can set the price of your course correctly, increase your revenue and deliver a learning outcome that provides the best possible customer experience.
Further reading on AdamEnfroy.com: If you’re still at the stage of creating an online course, here’s a simple, step-by-step guide to creating an online course.
Then, check out these online course platforms to help host your course.
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