Our Leading Learning Webinar in February focused on marketing and selling education from the value perspective, and we referenced our Value Ramp.
The Value Ramp is a tool that shows the link between value and price—the more valuable a product is in the eyes of the buyer, the more you can charge for it. In other words, increase the value of product, and you can increase the price.
The interesting corollary—and one that Jeff touched on when talking about discounts in the pricing Q&A (see the first question)—is that if the product is valuable and you don’t charge enough, people may not go for it. That is, the bargain price makes buyers suspicious; it makes them doubt the value and efficacy.
Last week NPR ran a piece on a new study published in the Journal of the American Medical Association that shows that people get better results when the drug they take costs more—even when the drug is placebo.
Participants in the study were given a brochure about a phony pain medication (described as being similar to codeine). Some brochures listed the pill price as $2.50; others showed a price of 10 cents. Participants took a pill, waited 15 minutes for it to take effect (in theory), and then were given electrical shocks to test their pain response.
The placebo pill was more effective when it cost more. As MIT graduate student Rebecca Waber reported in the NPR piece, “In the higher-priced condition, 85 percent of people experienced reduction in their pain…but only 61 percent of people did when they were in the lower-priced condition.”
How are you pricing your education offerings? Do your prices maximize the placebo effect of learning, that phenomenon in which learning becomes more effective simply because the learner expects it to be effective?
Maybe you owe it to your learners to charge more.
This month’s Leading Learning Webinar is all about developing a compelling strategy for your education business. Reserve your spot today at https://attendee.gotowebinar.com/register/5332735113580591618.
Our thanks to Web Courseworks for sponsoring so we can make the Webinar available for free.
And our Leading Learning Webinars are not an example of cost-value mismatch. The Webinars fall in the momentum zone of our own Value Ramp—and deliver quite a lot of value for no cost. Sometimes things are as good as they sound.