Source : http://www.netpond.com
Author : haui
Published on : December 08, 2006
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What role does price play in porn sales
Article by _LB_ from http://www.titanbucks.com/
Would you believe me if I claimed that you can sell a $30 a month site just as well as a $10 a month site ?
Well its true... and its all in how you market your product. Its no mistake that both online and offline good sales people are able to sell their premium priced product, which may even be identical to a rival's cheaper product. How so ... well its quite easy .. its mostly in the marketing and product image.
Lets take porn websites for instance... anyone remember the $10 site fad a few years back? Everyone thought that these $10 sites would retain for longer and convert better .. well they did retain a little longer but the conversions were nothing to write home about, and in some cases they converted worse than the premium priced sites!
The thing with marketing is that you need to
A) Choose your target audience wisely
B) Give them a reason to want your product enough that price isn't really that important.
We have a tv advert here ... some guy in a hotel wants the nuts in the fridge, but they are worth probably $1 for the packet and cost $6 out of the minibar. Well he really really really wants the nuts, so eventually buys them from the minibar to satisfy his craving. The hotel was smart enough to work out that they have a premium market in their own hotel rooms, and priced the nuts perfectly. So many people would feel bad about selling a packet of nuts for 4 times its normal price, and they would just add a very modest markup. Thats why most people can't market and why they will still own that modest little hotel just making a modest profit in 20 years. I don't know about you guys, but I am in this game for the big bucks, and I don't want to be still bashing a keyboard in 10 years time !
With adult websites its the same thing as the example above ... your surfer is looking for something. You need to learn to identify the quality of your market (eg is the surfer a tgp surfer used to getting everything for free.. or a new surfer fresh off yahoo serps) ... and you need work on selling that surfer your product. Your job is to convince the surfer that the site you are promoting is exactly what they are spending hours looking for and your site is their only chance at being 100% satisfied. Once you have done your job you have the customer in your hand and can price the membership wisely. Why on earth would you spend so much time selling your customer and then once you sold him and he has his wallet open ... start discounting your product. That would just be crazy... but many online vendors do that!
$1 sites or free membership sites are just a sales tactic trying to use price as the selling point, not the product. You have discount shops all over the place, and I guarantee you that the people who visit those $2 stores aren't too interested in the product, and are more interested in getting a bargain. Those shops dont really have to market their products, they only market their prices
Marketing your product takes skill and practice. Its no mistake that I can sell my sites (all at least $30 a month) and conversions are the same as if I were selling them for $4. So how ?
Heres some tips ..
1. Don't mention price. Your only concern is selling the idea or product first, and once you have convinced the surfer he will meet your price (as long as you don't ask for $500 for 10 day membership of course).
2. If you are an affiliate marketer, don't think that its your job to get the surfer to the sponsor and the sponsor's job to convert him. The tour should merely confirm your boasts and sales pitch. If you do your job the surfer arrives at the tour and *wants* to believe the hype and sales pitch. The tour should merely be a confirmation for the surfer, not the sales pitch itself.
3. In adult the easiest way to sell the surfer is offer up samples of content that are exactly what that surfer wants. Does that mean expensive content or from the popular content guys ... well not always. Some of the cheapest content I have gotten is the best converting. Do your research in a niche and try to give the surfer a taste of the perfect set, because that will leave them wanting more. Though make sure the paysite has that set in it otherwise you will piss the surfer off and earn a CB. In a few niches I have what I call 'hook' sets .. those are sets of pics that pull the clicks and really hook the surfer in. If designing a paysite tour try to design it in such a way that you can change content out quite easily so eventually you get all your best 'hook' sets in there
4. Words. Words can create more in a surfers head, can stimulate fantasy, and can offer more promise than anything else. Learn to refine your sales text and while implementing it remember to keep it simple, don't babble on, and get to the point. Easier said than done You should never need to use 'padding' in your sales text. You should always have too much to say and need to cut it down, rather than be floundering for anything good to say. Have you ever been sold by a sales rep who has a shortage of good things to say about a product or doesn't claim to "own one of these at home" ??
The theory LB is talking about is more commonly known as price inelasticity. Essentially demand stays the same regardless of price. For example if you need to go to the emergency room you are going to pay whatever they charge since at that service at that point in time is under such high demand that you would pay anything to be seen by a doctor.
We do the same thing in porn but it is constrained by time. I.e. your goal is to create inelastic demand for the site at that point in time. Also known as so horny for the content right in front of them that they have to whip out the credit card so they can jerk off.
Of course I respect LB's assessment more since he learned it in the field instead of a book like I did.
But not all decisions are this cut and dried. Now take beer for instance. They are both the same product but people are attached to one beer over another so if your favorite beer at the local pub is $5 and they have this new beer for $4 dollars then you probably won't buy the new one since you're happy paying $5 for your favorite. This demonstrates a lower level elasticity than the previous example. What if they lowered the price to $2? A dollar difference will not get you to try a new brew but if they knock off $3 dollar well then you'll give it a shot. Inelastic demand would be the opposite. i.e. you like your beer so much you would gladly pay $5 even if they were giving the new beer away for free.
I did a quick search and this site does a pretty good job: http://hspm.sph.sc.edu/COURSES/ECON/Elast/Elast.html . They even used my emergency room analogy in one of their questions. We academics all think alike.
What's really interesting I think as it applies to we adult webmasters is the theory of "diminishing marginal returns" but that's a story for another day.
Price inelasticity is an economist's way of trying to explain the times when their "price is a function of supply / demand" graphs don't work.
The price you'd pay in a Doc's emergency waiting room is purely a function of supply and demand (your demand is very high, supply is very limited). The price would drop significantly if it you had a small splinter which could be seen to at any time and there were plenty of docs hanging around looking for someone to cure :-)
As a mature(ish) market, porn is somewhat of a KVI, and within certain boundaries is fairly Price Insensitive because of that. KVI (Known Value Item) is where the market knows what the price ought to be for certain goods. Price Insensitivity is where the price (within certain limits) can move up or down and it doesn't really affect sales that much.
EG bread.
You get Value Bread, Nornal Bread and Premium Bread. Essentially they are the same product, produced for roughly the same price. The market knows the price of what a loaf of bread should cost and if the products were packaged and marketed in the same way, they'd have to be sold at roughly the same price. Because they're marketed differently, the prices can break out of the KVI hold and sell for different (presumably more profitable) prices. They then begin to set their own KVI for their niches.
Pricing of any product is a function of these three things:
Reality (what the product actually is).
The Market (KVI, supply, demand, pricing sensitivity etc).
$19.95 - $29.95 is fairly standard for a smaller non-corporate sites.