Many creators assume low-ticket products are the easiest way to diversify revenue. But the math behind that strategy is often much harder than people realize.
Do you REALLY want to be in the low-ticket products business?
A coaching client of mine said this to me:
“My interim goal is to develop some lower-ticket products that appeal to my ideal client. My hope is to diversify my income streams, appeal to more people, and develop fans who want to keep working with me and tell others to work with me too.”
Here’s what I said to him:
Yes, there’s value in diversifying your income streams.
And yes, a person who pays for something and gets a good result is more likely to trust you and buy again.
But…
Low-ticket and high-ticket buyers tend to be different people.
A person who buys a $50 product from you isn’t likely to ever become a $10k customer. Those appeal to different people looking for different things.
It’s like saying someone who buys a Wolfgang Puck frozen pizza will now be more likely to go to Spago for dinner.
Maybe, but probably not.
So the real question is whether you can sell enough low-priced products to justify the time/investment it takes to create and sell them.
That’s a financial question.
How much income would you need to earn to justify the effort? And what’s the opportunity cost of doing so?
Because every minute spent on low-ticket offers is a minute not spent on high-ticket offers.
I’m not saying you should or shouldn’t do it necessarily – you can succeed either way.
But here’s some context to set expectations:
You paid me $1,750 for our coaching/writing partnership work together which will probably take about 1.5 months when all is said and done.
For comparison, my LinkedIn Experts’ Playbook has been bought by 59 people (at $29 or $49) and generated about $1,800 in revenue over the past several months since I launched it.
And I have a 30,000 subscriber email list to promote it to.
Now, it only took me about a week to put it together and record it, set up a sales page, etc. and I can sell it forever so it will continue to bring in more revenue over time (hopefully).
Was it worth the time I put into it? Probably.
But again, I already have a large audience to promote it to and it’s certainly not making me rich.
From a purely financial standpoint, one engagement with one client (you) has earned me as much as that.
To bring this back into your world…
If the average high-ticket client is worth $5k to you and you were going to sell a $50 product, then you would need 100 sales of the low-ticket product to equal that one high-ticket buyer.
If 10% of the people exposed to your product buy it (which would be a HIGH conversion rate), you’d need to get the product in front of 1,000 potential buyers to earn the equivalent of one high-ticket client.
My point in sharing this is just to make you think through the reality of the low-ticket game (since lots of people make it seem easier than it is).
RELATED:
• 10 Questions That Reveal Missed Opportunities In Your Business Model
• 10 Ways To Boost Sales In One Minute
• This Sales Page Creator Helps You Convert Visitors Into Buyers