I will be discussing three major topics in this blog post. The three main areas we will be discussing in this post are:
1) My reaction to the new pricing system and how it will affect my own courses moving forward
2) March 2016 Promotion Strategies and when to change the prices of your Udemy courses
3) Pricing strategies for the future and beyond here on Udemy!
Let's Get Started!
1) My reaction to the new Udemy Pricing System
My first reaction to the new pricing system was complete "shock and disbelief". "Only $50 as a maximum? $20 minimum? Seems like such a small range and wont everyone choose the same prices now?"
But once I did my research and read more as to "why" Udemy was doing this, I began to understand and think that it will benefit everyone moving forward! Incase you have not heard about the new pricing system, here is the email sent out by CEO Dennis Yang March 2nd, 2016:
"Hello Instructors,
Over the past few months, we have spoken with many of you on the phone and in person. Thank you for sharing with us. One topic has come up again and again throughout these conversations: our pricing. In this email I'll share with you an update to pricing and promotions on Udemy as well as next steps for you.Current Pricing
Students are Confused by Inconsistent Pricing
Today, prices are inconsistent and complicated for students. List prices range from $9 to $300, but the reality is that 90% of sales occur with a coupon code, and at a price less than $50. Students have been telling us how much they're willing to spend for an online course, but we haven't been listening as well as we should. We want pricing to be accessible and intuitive for students - to serve as an easy entry into learning, not a barrier.
Instructors are Frustrated by Constant Discounts
I've heard directly from you, our instructor community, that our promotions train students to wait for the lowest price and lead to an erosion of your average selling price. This has also encouraged inflated list prices, which makes it difficult for you to generate organic sales, and we've heard from many of you that deep discounts hurt your brands.
New Pricing
Reducing Discounts and Increasing Trust: Updating our Pricing
To address student and instructor concerns, today we're announcing changes to pricing and promotions on Udemy. First, discounts, for both Udemy and instructor coupons, will be capped at 50% off.
Additionally, we're announcing a change to list prices on Udemy: list prices will be capped at $50. This, combined with the reduction in discounts, will help keep courses accessible for students going forward. Effective April 4, 2016:
- Courses on Udemy will be priced between $20 and $50; we will also continue to support free courses. Please see our Global Price Matrix for localized ranges.
- Each course price will be individually set by the instructor between $20-$50, within $5 increments.
- Course discounts, for both Udemy coupons and instructor coupons, will be capped at 50% off; we will also continue to support free coupons.
Learn More
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We need a pricing model that combines both instructors' desire to minimize discounts with students' desire for fair and consistent pricing. We believe that combining lower list prices with smaller discounts will help ensure that Udemy remains a sustainable and accessible marketplace for both instructors and students for years to come.
We all believe that people everywhere should have access to the skills and courses necessary to build the lives they imagine for themselves. This belief is why I joined Udemy, and why so many of you teach. I'm honored to work alongside you, and our entire team is standing by to answer any questions you might have. If you'd like to set up some time to speak, please fill out this form.
At this time we ask that you view this post for the next steps you need to take, as well as a more detailed explanation of this change.We're thrilled to partner with all of you on this journey, and we couldn't be more optimistic about our future together.
Dennis Yang
CEO, Udemy"
What does this mean for all of us online instructors? It means we need to work with this new system, instead of against it. I will prove my own personal strategies in step 3 of this blog post!
After looking at my own sales data a majority of people were willing to buy my online courses at $10 to $25 dollars. I think this is why Udemy is going to this new pricing strategy and I believe it will work moving forward!
2) March 2016 Promotion Strategies and when to change the prices of your Udemy courses
Since today is March 7th and the new pricing system will not be in place until April 4th, this offers us instructors a unique opportunity to promote our courses. Why? Because $1 to $9 coupons and coupons with massive discounts (Anything beyond 50%) will cease to exist past April 4th.
My suggestion is to leave your courses the same price as they are today and not adapt the new system until April 4th. Why?
a) Udemy is still running its discount promotions in the month of March (I have received a ton of March affiliate sales so far!)
b) This will be the last chance (possible ever) to receive full price purchases of your Udemy courses! I received one as an affiliate sale already this month!
c) Run a massive $9.00 course super sale all the way until April 3rd or 4th. This new pricing system creates wonderful leverage to discount our courses below the future prices. As described above 50% will be the biggest discount moving forward and if your courses are the minimum $20 then $10 is the absolute lowest price for a course ever again on Udemy. So if we create and use our coupons below this mark ($9.00) as a super special I would image a lot of students would like this and want to buy our courses at this price!
3) Pricing strategies for the future and beyond here on Udemy!
So what are our options moving forward here on Udemy? What should I charge for my courses moving forward? This will be a difficult question to answer because the conversion data for your Udemy courses is certainly going to be different than the conversion data for mine! According to Udemy my courses are selling at around the average of $20 (with some of my bestsellers at around $25 on average). This means that I will most likely choose to list all of my courses at $20 to start and some of my bestsellers at perhaps $25. This will hopefully lead to more sales and will help me against my competition who will be selling similar courses but perhaps at a higher price? Only time will tell but I think this is going to bring in more students (especially organically) and put more money in our pockets as instructors! A Win Win for Everyone!
These are just a few ways you can take advantage of the new Udemy Pricing System and cash in on this unique opportunity!
I hope you have enjoyed this weeks case study! There are many ways to begin teaching online, but this should give you some great ideas that have worked for myself and many other online instructors! Stay tuned next week were I discuss more online teaching strategies.
Thank you for reading our blog post today! If you have any questions please feel free to post your comments below!
Also, you can check out all of my blog posts for FREE by going to:
Sincerely,
Joe Parys
