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[VIP Money Making] Fizzle's Product Creation Intro
When we talk about creating a product, there are a few principles that never change.

The first one is cost, and this is where the vast majority are failing.

One of the biggest misconceptions by novice marketers is that low price equals more sales, or really what I should say, is that they believe low price equals more sales revenue.

This actually isn't the case at all, price actually ties directly in to the second core principle of creating your own offer which is perceived value.

Perceived value is simply how much the customer thinks your product is worth, and that personal determination is what causes them to buy, or pass.

Think of it this way:

You look at two information products on the subject of media buying.

Both sites have a nicely designed sales page and believable testimonials.

One course is $47, one is $2000.

Right away without knowing a single additional detail about either product, you assume that the second product is much more valuable simply because the price is so much higher.

But more often than not, the $47 product is as good or even better than the one for $2000.

The difference from the sellers point is the guy selling the $47 product needs to make 43 sales to make $2000, where the other guy only needs to make only one.

Could the $47 product sell more in total revenue than the $2000 product? Sure it can, the question is, would it be worth it?

To answer that we need to look at a few variables. Let's just pretend it's our product.

The first would be cost per acquisition, how much does it cost us to acquire a new customer at each of those price points.

Let's say for examples sake it costs us $16 in advertising to acquire a new buyer for our $47 product.

Our net profit would be $31

Let's say now that it costs us $150 in advertising to acquire a new customer for our $2000 product

Our net profit would be $1850

Even if the $47 product outsells the $2000 product 50 times to 1, we still make more money with our higher ticket course.

It actually really doesn't matter which product would sell more in initial revenue though, because a real marketer is only concerned with one figure, and that's lifetime customer value.

It doesn't matter how money you make initially if you could have made a lot more in the months or years to come.

Let's say the $47 course made you $200,000 in sales, but very few of those customers spent any more money with you in the future whether on your own products or other products you could potentially drive them to.

Let's now say the $2000 course only made you $100,000 in sales, but a large percentage of your buyers were responsive to future offers from you. That could potentially be worth millions of dollars.

I've sold low, and I've sold high, and I can tell you without question, every product I've ever created whether physical or digital always made me far more money in a high price point.

There really isn't a single market in the world that you can look at where higher price points aren't making far more money for the company than lower priced competitors.

There are dozens of CPA offers selling skin crème auto delivery memberships for $69 to $180 per month. The same can be said in any high end department store or salon where prices can go as high as $500 per ounce.

Guess what?

None of it is any better than the store brand of lotion that you can get a 48 ounce bottle of for under $3, it's a scientific fact.

Not only is it a scientific fact, but countless news shows, magazines, and other media outlets have done thousands of stories over the years discussing exactly this very fact.

The high end skin care industry will do billions of dollars this year, and has increased in profits every single year for decades now.

Value can SOMETIMES make you rich, but perceived value will ALWAYS make you rich. What I mean is, you can make the best skin crème the world has ever seen and charge $1 for it, but without perceived value, you'll have a very hard time making millions of dollars with it.

On the flip side, you can sell a S***** skin crème for $97,but because the perceived value is there, you can do millions of dollars in sales every month.
Let's talk about our own industry, how many news stories have we seen this year on work at home internet scams? Free trial offer scams? Ringtone scams? Get rich quick scams? and yet every one of those industries online did record profits in 2008 and the same will be said for 2009 2010 and many years to come.

People want the dream so bad, reality can't possibly sway them.

They want to be thin, they want to be rich, they want to be happy so bad, that all the scam exposing news stories in the world can't take the place of a good sales pitch offering them a way to a better life.

People are always more likely to pay a lot than a little and that is because it's been practically engrained in our DNA now that more money equals more value.

I've seen tons of marketers create some really great products but then try and sell them for a few lousy dollars assuming that people wouldn't pay large amounts to some no name, but would at least pay a lousy $17 to check it out, only to look at an empty paypal account every day.

I'll give you a couple of real examples:.

A member of Blackhatworld got my AIM from someone and sent me an IM last summer asking to take a look at his site and see if I had any advice since he wasn't making any sales.

Generally I don't respond to these because I just don't have the time, but I decided to have a look and found out that his site looked pretty good, he was driving targeted traffic for the product which was actually a script, and it was seemingly much better than the few scripts he was competing against.

Then I saw he was charging $27 for the thing. I asked him why the hell he was charging $27 one time for a script that the others were charging around $50 monthly or up to $300 one time for.

He said that for one it only cost him $600 to have a programmer make, and that he figured he could sell hundreds at such a low price point since it worked better than the others out.

I told him he had no perceived value by doing that and to raise the price to $97 per month. I knew it meant additional programming to make it user based and figured he'd probably balk at spending more money after making no sales, but he actually took the advice.

He started getting sales, and the last time I talked to him he had made well over what he spent on the programming and initial round of traffic that didn't convert, plus had recurring monthly income from it now that was all profit.

Here's a better example since it's one that took basically zero effort:

I have about 8 external hard drives filled with bull***** website templates, PLR products, scripts, you name it, the same stuff 9 out of 10 of you guys have collecting dust on your own hard drives.

Well last year I was taking a lot of time off, I had a lot of money coming in each day and didn't really have too much maintenance involved in it so I got lazy and spent a lot of time just doing whatever I felt like each day.

One particularly S***** week weather wise when I couldn't get out of the house to go screw around I got bored and decided to do a new site.

Typically I just make a decision to do something new then let the details come to me over the next couple of weeks automatically.

I'm mentioning this because a lot of you are probably suffering from the same issue as I have and that is that I can't sit in my office and brainstorm, it just doesn't work that way for me.

For me, it happens when I'm in the shower, in my game room shooting pool or playing Ms Pacman, or just driving, randomly the ideas will come to me.

So if you find yourself sitting at your desk trying to come up with ideas for a site or product and getting nowhere, that's a sign that you need to leave and just let it happen naturally.

Anyway, after a few days it came into my head that I would just sell a bunch of PLR products I had sitting around.

Genius right, who hasn't done that a million times? Well the difference between myself and the large percentage of others was that I wasn't going to be charging $5 for 1000 make money guides trying to get email subscribers.

I was going to charge a lot more for a lot less.

So what I did was spend about 6 hours rooting through all these PLR names and picking out the ones I felt had the best titles and covers.

Once I had 25 of the best sounding and most legit looking PLR products I had ranging from website creation, to marketing, I had my mini site guy build me a quick two page site, header, logo, etc, and just link it to paypal.

I wrote up a paragraph on each of the 25 products hyping the shit out of them and why they were such wealth's of information on different angles of making extra money from home start to finish.

Then I did my famous Rob's testimonial method where I took pictures from peoples myspace profiles, made the testimonials sound like a real person wrote them, and even included an email address for all of them from different free mail accounts. An example would be [email protected] e-mail address is being protected from **** bots, you need JavaScript enabled to view it

People respond like crazy to these testimonials because they look so god d*** real. I've never seen anyone do testimonials like I do and this is one of my most profitable secrets I'm now passing on to you.

A number of visitors will actually email your testimonial emails, so it's key to check them fairly often to snatch those sales. Make sure you wait at least a few days before emailing them back on one of them, and if they sent an email to say all 8 testimonials, only respond from a maximum of 3 at separate times so it looks legit.

Want to get crazy like me? Make a facebook or myspace profile for your fake testimonial people with friends, then invite the person asking if you were a real testimonial to be your friend there and share tips. That's a guaranteed buyer now.

The price tag: $397

If anyone has ever sold 25 painfully basic PLR products for $397 I congratulate them and tip my hat, as far as I know I built the only site I've ever seen that did it so big.

So what happened?

Well first of all I should tell you about the advertising of it, which was all outsourced.

I hired a PPC management company, gave them a $2000 budget to start with and had them go to work optimizing campaigns for the site.

As a side note, you can get started with a PPC management firm for under $500 if you haggle with them and tell them "Hey, when I see some results and that you can do it better than I can, my budget for you will be endless".

As a side note I'm currently testing 4 PPC management companies right now to get exclusive deals and pricing for DIM members.

Anyway, that's all I did for the site in the way of advertising.

Within three weeks I had 67 total sales in. All told before I sold that site about 8 months later I had made just under 1150 sales.

I spent about $67000 in PPC expenses and the management firms commission, remember though, the profits paid for all of that. There were a few dozen chargebacks , most of them I won, so in the end I made well over 300 grand on a site I never even touched, and then I sold it for 16 months revenue to some hedge fund manager of all things.

What's cool about this now is that my non compete is up. For those of you that don't know, when you sell a business, even a website, typically you sign a non compete with the buyer that states you can't just go and build another one to compete with them or help someone compete with them for anywhere from 6 months to a year or more.

I have no desire to build another one, but the non compete being up means I could tell you this story and help you build your own model like this.

I also kept the entire customer list up and till when it was sold, which has sense made me quite a chunk of change from mailing other offers including my own stuff.

I was actually going to mail that list about DIM this month when the price goes up to $197 but now I feel a little guilty since a few of them will end up seeing this and probably remembering buying that package.

Would be pretty funny though.

My goal is really to help you understand what a huge roll price plays in your perceived value no matter what type of offer you want to create, not just for you to all rush to your hard drives and try and sell PLR products for hundreds of dollars.

This series will revolve around creating a real product which will become a CPA offer. I'm pretty much sold on this being some sort of crème product, maybe a breast enhancer, wrinkle serum, something like that.

We want a massive buyer market, and we want something a high price point can be set for maximum perceived value which this kind of product falls right into.

The steps will look like this:
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Stay Tuned.

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