Just read a question on the discussion list...

"I recently received an offer that probably a lot of you got too, for a workbook and five CDs for the price of USD $597. Now, I balk at that sort of price. It would cost an absolute maximum
of $50 to produce each set (and I'm grossly overestimating here), which leaves a cool $547 profit per set. My question is: how can this sort of pricing be justified? Do people really sell these things for this amount of money?"

Here is what I posted in response:

I love this topic, because I've been on both sides of the fence - the customer and the merchant.
Two real life examples.

A few years ago, I decided to write a book and make it the #1 Amazon seller. I had no idea how people do that, and couldn't seem to find any information about it. I was frustrated. Then someone sent me an e-mail about "How to Become the Amazon Best-Seller". The e-book was selling for $79. Of course, I purchased it immediately.

After my initial dissappointment (it was a 15-page PDF document), I learned a valuable lesson. THe size truly does NOT matter when it comes to information products. It's what I get out of it as a result that counts.

Also, Recently I purchased "Teleseminar Secrets" from Alex Mandossian for $1,600. It contained 16 CDs, and I am sure cost no more than $75 to produce. And yet, he charged over 21 times the cost!

After listening to it over the course of 30 days, I picked up so many valuable tips and insights from him, I can't see myself NOT owning a copy of it, regardless of the cost.

The point I am making here is that authors do not charge for how much it cost them to produce the physical product. They base their prices on

a) how much experience they put into developing the product, years of learning, etc.

b) the tangible results they'll produce if their advice is implemented.

My guess is, if you felt that they were overcharging, perhaps it's because they didn't do a very good job convincing you. Usually, the price is only the 2nd objection - the 1st is that you're not convinced the product will help you.

Warmly,
Milana Leshinsky

P.S. I've seen many live events sell for $2,000-$5,000 for a 2-day weekend of presentations, although the cost is probably no more than $200 per person. I've always questioned that. But after organizing, hosting, planning, reserving, surveying, following up, etc. the 8-day ACCPOW coaching tele-summit (which is coming up in just a few weeks, by the way - www.accpow.com/summit2006), I completely understand. The effort that goes into developing something like this may be invisible to the eye of the customer, yet very real.