Don't Price Yourself out of Contention

With any company, pricing the items you have to sell—be they products, ad space, services, or something else entirely—is never easy. You need to find a balance between what you believe what you're selling is worth, and what people are likely to pay.

With a site that generates its revenue through selling online subscriptions, you won't have any costs associated with inventory or manufacturing products. What you will have, however, are some pretty high marketing costs. As mentioned, making money by selling online subscriptions is a pure numbers game. You'll need some pretty heavy traffic to get a high enough number of actual subscribers. So your marketing costs are bound to be pretty high. You'll need to account for that, and for all other expenses, to set the pricing right.

Start by calculating your monthly costs to maintain and market your site. Then look at other, competing sites in your space, and find out how much they charge. Estimate the total amount you would need to charge, and how many people would need to sign up at those prices, for you to cover your expenses and turn a profit. Be careful, and don't get too greedy. If the price is too high, you'll scare customers away.

It's usually a good idea to create at least three packages for people to choose from, such as a Standard (least expensive, fewest benefits), Premium (more expensive, moderate benefits), and Ultimate package (most expensive, most benefits). If you have only a single subscription package, then people can either choose to subscribe or not. But with more options, there's more to choose from. Through pricing and benefits, you can create the sense that the subscriber is getting a greater value with a higher package. (Usually the middle package is the one that sells.)

(MLA 8th Edition)