The What to Charge Dilemma

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Originally Posted by Xstr8guy

Finding the point at which sales start to drop as the price goes up... that's the magic bullet!

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Indeed!

You also have to take in to account rebills, upsells and also if you get more multi-month joins over single month recurring sales, etc, all of this can have an impact on a program owners bottom line profits, in addition to how much bandwidth it costs to make a sale and once you have made a sale, how much bandwidth the average member uses once inside the members area.

Regards,

Lee

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Originally Posted by Lee

... in addition to how much bandwidth it costs to make a sale and once you have made a sale, how much bandwidth the average member uses once inside the members area.

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Oh you and your bandwidth costs! Lol.

Someone said recently (I wish I could remember who or where) that once they stopped worrying about being cheap with the bandwidth, that is when they started making the big money. Don't get me wrong, I cringe everytime our hosting bill goes up. But then I remember that profits are growing much faster than expenses. So it's all good. :)

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Originally Posted by Xstr8guy

Oh you and your bandwidth costs! Lol.

Someone said recently (I wish I could remember who or where) that once they stopped worrying about being cheap with the bandwidth, that is when they started making the big money. Don't get me wrong, I cringe everytime our hosting bill goes up. But then I remember that profits are growing much faster than expenses. So it's all good. :)

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Jim,

1000 members pulling 1000+ 300MB movies IS a lot of bandwidth usage, remember, most hosting plans only give you a set amount of bandwidth until you need to upgrade the server itself, not just the 'amount' of bandwidth packaged with the existing server, that can equate to thousands of dollars with some hosting companies.

Plenty of sites have closed down because the owners didnt factor in how much bandwidth was burned before they even made a sale and, once the sale had been made, how much bandwidth the average member will burn through in a month ;)

Making $13 on a revshare sale is great, so long as bandwidth costs, content updates, scripting and processing can all be factored in for that $15.

Dont forget, a lot of webmasters are running paysites on hosting that will charge them $5+ for overages, 3 movie scene downloads could cost those site owners all the money they made on that single join.

Media files are getting bigger and whilst bandwidth prices are getting lower, it should still be an issue for anyone running a paysite and definately an affiliate program, not to include those in your cost analysis' would be crazy.

Regards,

Lee

Oh wow - I totally did forget to factor the BW usage in based on membership times content. This was the sort of thing I was hoping for as far as what things to factor in on overall costs. Thanks!