Science of Pricing by Justin Wilcox

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Science of Pricing by Justin Wilcox

  1. 1. SCIENCE OF PRICING CustomerDevLabs.com
  2. 2. Nathan Founder Helix Labs Mark Justin Founder MovingWorlds.org Founder Nimbus Health
  3. 3. Nathan Founder Helix Labs Mark Justin Customer Development Labs
  4. 4. Customer Development Labs Helps { Founders Accelerators Corporations Practice Lean Startup
  5. 5. Science of Pricing
  6. 6. That’s Us.
  7. 7. Get to Know You
  8. 8. What is Success Today?
  9. 9. http://bit.ly/leanpricing
  10. 10. What does Demand Look Like?
  11. 11. Groups of 3
  12. 12. 3 Products… Lowest Price = Suspicious Generics Haircut Gas
  13. 13. “You get what you pay for”
  14. 14. “Get What you Pay for” Curve Units Price
  15. 15. 3 Products… Lowest Price = Good Deal Flights Landscaping Gas
  16. 16. “Good Deal” Demand Curve Units Price
  17. 17. Did you ever disagree?
  18. 18. different people = different curves
  19. 19. “Combo” Curve Units Price
  20. 20. Professor Min Ding Penn. State 2010: Journal of Retailing Price as an Indicator of Quality
  21. 21. Price Implies Quality
  22. 22. “Low Interest” in Quality Curve Units Price
  23. 23. “High Interest” in Quality Curve Units Price
  24. 24. “Actual” Demand Curve Units Price
  25. 25. “Actual” Demand Curve Quality Hump
  26. 26. Real Demand isn’t Blue It’s Pink
  27. 27. Optimal Pricing = More Revenue Optimal Pricing = More Customers
  28. 28. Is this true for Startups?
  29. 29. Garick Hismatullin Founder
  30. 30. Medical Consultations via Phone
  31. 31. Founders Institute $15
  32. 32. $25 8.5% $49 8% $99 10.5%
  33. 33. Yes. Startups have quality humps.
  34. 34. BONUS: Find your Hump Find More Customers
  35. 35. NEXT UP How to find your Hump
  36. 36. Reflection
  37. 37. 1 Takeaway
  38. 38. #LeanStartup BREAK @CustomerDevLabs
  39. 39. How to find your hump?
  40. 40. Price Testing
  41. 41. A/B Testing your Price
  42. 42. PRICE TESTING: 1. Build a landing page 2. A/B test price 3. Accept real credit cards
  43. 43. Questions
  44. 44. SECRET 1: Everyone gets the lowest price
  45. 45. Where is our Hump?
  46. 46. SECRET 2: Pre-Orders
  47. 47. What should we price test?
  48. 48. Who wants to find their hump?
  49. 49. Pick your team
  50. 50. 45 Minutes to Launch
  51. 51. Something like…
  52. 52. Go.
  53. 53. 45 MIN
  54. 54. 40 MIN
  55. 55. 35 MIN
  56. 56. 30 MIN
  57. 57. 25 MIN
  58. 58. 20 MIN
  59. 59. 15 MIN
  60. 60. 10 MIN
  61. 61. 5 MIN
  62. 62. 2 MIN
  63. 63. 1 MIN
  64. 64. DONE
  65. 65. NEXT UP: Driving Traffic
  66. 66. Reflection
  67. 67. 1 Takeaway
  68. 68. #LeanStartup BREAK @CustomerDevLabs
  69. 69. Driving Traffic
  70. 70. 3 Ways to Drive Traffic
  71. 71. Free Traffic Learn & Optimize Paid
  72. 72. FREE!
  73. 73. Give Your Friends a Script • Ask for advice • Be Grateful
  74. 74. Give Your Friends a Script Hey Friend of Friend, My friend is launching a new startup trying to solve ________. I’d love it if you can take a minute, take a look at its new site, and support it if it speaks to you. Of course, if you have any thoughts or connections, I’d be happy to connect you with the founder:______. Thanks a ton! -Friend
  75. 75. Posting to Groups • Be respectful • Be humble
  76. 76. Posting to Groups Not sure if this is appropriate for this group or not, but I’m passionate about solving the _________ (problem) and hoping for some advice. We’re launching ________ to help solve the ______, and I’d love your thoughts. If you can help, please take a look at the page, and shoot me any thoughts you have:
  77. 77. Responding to Quora/Forums • Add value • Give full disclosure
  78. 78. Responding to Quora/Forums Full disclosure, I run a startup which is trying to solve this problem. We just launched ___________ to make it easier to _________. It should help you solve this problem. And if you want to message me, I’d be happy to talk about your situation in greater detail and share the insights I’ve learn along the way.
  79. 79. The real kind… PAID
  80. 80. Paid Sources Problem-focused Google Adwords Emotional-focused Facebook Professional/Skill-focused LinkedIN Industry/Trend-focused Twitter
  81. 81. You have the tools.
  82. 82. Bringing it all together.
  83. 83. A B
  84. 84. Bounce pre-orders $5 x 1.4% = $.07/visitor $10 x 1.7% = $.17/visitor $20 x 0.9% = $.18/visitor before built product
  85. 85. Our Goals
  86. 86. GOAL 1 Why should you price test?
  87. 87. Find your Hump Find More Customers
  88. 88. GOAL 2 How to Price Test
  89. 89. PRICE TESTING: 1. A/B test price 2. Lowest price to all 3. Real credit cards
  90. 90. GOAL 3 Learn by Doing
  91. 91. You’ve done it.
  92. 92. Reflection
  93. 93. 3 Takeaways
  94. 94. 1 Next Step
  95. 95. NEXT UP: Q&A
  96. 96. Feedback
  97. 97. #LeanStartup QUESTIONS @CustomerDevLabs
  98. 98. Nathan Founder Helix Labs Mark Justin CustomerDevLabs.com
  99. 99. SCIENCE OF PRICING CustomerDevLabs.com

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