Ever since the $7 Report epidemic swept the world wide web, we've been seeing hundreds of inexpensive info-products. This current trend means you can get reports and ebooks, and even software or scripts, for $5-$15.
I for one love this new wave - not only do you generally make 100% commission on referrals as an affiliate, but many of these products are coming with Master Resale Rights (aka MRR). Not to mention you get some great products at VERY low prices!
While I am enjoying this trend from all 3 angles (as a buyer, an affiliate and a reseller), there is some debate on the topic. Some people are concerned that the "cheap report trend" is devaluing info products across the board...
I disagree.
The "$7 craze" is nothing more than a new twist on loss-leaders and viral marketing. With MUCH better results.
The mistake people are making is in comparing a $7 or $10 report with a $47 or $97 ebook. There has been talk that the lower price points are devaluing info products across the board, affecting sales of higher priced products.
Instead, the comparision should be made against the traditional free report (i.e. a loss leader to funnel leads into your system). Viral Marketing strategies have been taught for years, and done online very successfully.
You give away a free report, a free trial or other free product in order to attract your target market to your website... and then follow-up with them via email. In both cases of course, the quality of your product directly affects the response rate of the list that you are building.
This new twist is simply a qualifier. When you give something away, you attract "freebie seekers". When you offer a great value on a quality product, you build a list of buyers that have proven they have a genuine interest in you and your products.
Weigh the value of that for a moment. All mailing lists are valuable, but how much more valuable is the list of people who have taken action and that readily make online purchases.
I recently did a market test between a free report and a low-cost report. The test was to determine the dollar value per subscriber as well as the responsiveness of each group of subscribers.
While I am still analyzing the results, the initial stats have been quite revealing. Both groups were given the same options, including a second freebie and a backend offer.
Those that paid a very low price for the information were worth 150% more, on a dollar value per subscriber basis. Even the response rate to another (very related & compelling) free offer... was incredibly low for those that downloaded the original product free.
You'll find that if you charge as little as $5 for your report or "loss leader", you will get much better results in regards to backend offers and overall responsiveness of your mailing list.
Again, this is in contrast to giving it away free - not using a higher price point.
The argument that some people make against the "$7 Craze" is that low-quality products are being thrown together and sold for $7 or $10, polluting the information landcape. Truth be known, this same phenomenon ocurred with $47+ products, and has for years.
The requirements for quality and value are at an all time high - no matter what the price point.
The goal with the low-cost product is to gain exposure and to funnel leads into your system. It should be considered a loss-leader, and not your primary source of income. The true revenue opportunities are in the upsell, backend sales, and in the list that you build.
Someone who buys a $7 report from you that is worth far more than the purchase price, would be much more likely to order a $47 product from you in the future. So do I think that "cheap reports" are devaluing info products as a whole? No, certainly not. I think they serve as an excellent qualifier, and an excellent method for reaching your buying market...
Best,
About Lynn Terry
Hi Lynn,
I couldn't agree with you more. It's much easier to get a first time buyer with a lower cost report than with a higher cost one. And, like you said, a list of buyers is worth more than a list of people who got a freebie.
As for devaluing the market - well, perhaps it's time Internet marketing products were a little more "budget friendly". That's not to say a 100+ page ebook isn't worth $47 - $97. I think it will just ensure that marketers who want to sell their products in that price range will create products that are truly worth the price.
Denise
Agreed, Denise - perhaps a classic case of a market correcting itself!
I too have just begun using $7 reports - the link attached to my name is to two new $7 reports about business card design and marketing.
The concept makes a great deal of sense to me and you explain it very well, Lynn.
It is also a good way to inject new life (and profit flow) into older products, or those that have not done well in the past. I am actively working on $7 offers to coincide with most of my main products.
Diana
Hello Lynn.
I bought my first $7 report from the man himself Jonathan Leger and it gave me hope that there was a place in this business for the little guy so I agree with you 110%
Jimmy A.
I'm going to have to quit reading your mind. I was thinking about this exact topic before getting online this morning and trying to think of a post for it.
Great minds think alike, they say 😉
I agree this is good for the market. I've seen so much garbage out there selling for $47 and a lot more. I'm coming out with an ebook in a couple of weeks and I'm so excited about it. And this is not the Internet Marketing field but I bet it'll work just as well.
I too think there is no way the $7 report can hurt the market.These reports can be very informative and helpful . There must be a place for everyone to thrive in the marketplace.Start small and grow big.
I for one am very glad someone has had the good sense to start the $7 dollars secrets. In my mind it make a whole lot of products more available to all of us. I would never think of paying $47-$197 for a digital product I would not even do it in real life with a real book unless it was very very special or it was a textbook I needed for some course. I think it is a great thing and long may it continue
Great stuff and bang on the button...as usual! 😉
I'm not surprised you hit the nail on the head once again Lynn.
As I read this . . .
The argument that some people make against the "$7 Craze" is that low-quality products are being thrown together and sold for $7 or $10, polluting the information landcape.
This was running through my mind before I even read it:
Truth be known, this same phenomenon ocurred with $47+ products, and has for years.
So, just because it has a $47 price tag or even $97, that means it's good? Oh I so beg to differ. I have a real problem with things that cost this much - mainly if I don't know the writer. I'm not going to say I've not bought because of this because I have ... but you can be sure there was a damn good sales page involved.
As you've already been able to prove, the average "freebie seeker" is just that ... someone looking for something for free. Which of course isn't always a bad thing but ... that also means they usually don't buy a thing either.
Selling your "lead reports" (that's what I like to call them) for a low price gives your customers a chance to get a feel for what you have to offer.
Alrighty, off my soap box and down rambling now. Great discussion!
Great stuff. i'd heard about this before but wasn't too clear on it. It's given me more confidence in the $7 thing.
I totally agree with you. When a customer purchases my book, "Breaking all the Rules: How to Rent Your Vacation Home" they also recieve a copy of my Welcome Book. I think that is a pretty good deal when you can get two great books for the price of one. Along with that I offer free advice for their rental properties and a free property listing. So, Yes, I do agree with you.