MBA2360 Q&A Wednesday: Is it better to sell high ticket or low ticket offers when getting started?

0:09Heyo! Welcome to the$100 MBA show because a better business begins with you. That's why we deliver practical business lessons. I'm your host, your coach, your teacher, Omar Zinhome. I'm also the co-founder of Webinar Ninja, an independent software company I started back in 2014. And today's episode is Q &A Wednesday. On Q &A Wednesdays, we answer a question from one of you, one of our listeners. If you got a question you want to ask, go ahead and email me over at Omar at 100mba.net. Today's question is from Max. And Max asks a very simple question, but an important one. Is it better to sell low ticket offers or high ticket offers when you're getting started.

0:46For those who are new to the terminology, low ticket offers basically means a low ticket product, service, course, coaching, software, whatever it might be. The price tag is roughly, you know, under$2 ,000. High ticket offers usually mean you're selling something that's$10 ,000 or more. Now that could be for a year's membership or year of consulting, but that's really where the range is. Now, of course, there's things that are three or four or$5 ,000 and that's somewhere in between mid offers. And there's a lot of discussion about that. Is it even worth doing mid offers? Might as well high ticket, same amount of effort, but that's a different story, a different lesson.

1:25Today, we're going to discuss when you're getting started, when you still don't have an audience, maybe you're trying to build your first customer base in your market and you're trying to figure out what to offer people. Should you offer something expensive or should you offer something low cost just to get your foot in the door? That's what we're going to get into in today's lesson. My answer might surprise you. So let's get into it. Let's get down to business. When it comes to this topic, high ticket versus low ticket offers when you're getting started, many experts say start with high ticket because in order for you to have a sustainable business that can fund your expenses and your life, it might be harder to have several customers buy your low-ticket offer to have enough money to pay for those expenses than have a few customers with a high-ticket offer because, again, you're charging more per offer.

2:13So say, for example, you need$10 ,000 a month to sustain your business and your life, and you offer a$10 ,000 offer. That means you just need one customer a month. So theoretically, it means that, hey, you don't need a lot of sales to keep your business and your life afloat. But many people think it's easier to sell low ticket offers because the barrier of entry is lower. Some people even just have a hard time selling something that's expensive at the start. They're not used to selling those things. A lot of people have different mindset barriers when it comes to selling something expensive. And here is my answer.

2:50Either one can be true. I know this sounds really weird, but both can be true. Meaning that for you, it might be better to sell high ticket offers at the start. And for somebody else, low ticket offers might be the right answer. And let me explain how do you know what's right for you? Well, here it is. In my opinion, at the start, when you're building your business, momentum is so important. Getting a few wins under your belt is so important. That feeling of, yes, I can do it needs to happen a few times over so that you can get the confidence to continue to grow your business. I'm talking about the very start.

3:31I'm talking when you start selling your products and services. We're talking about the first few months. So you have to ask yourself the question, which would motivate you more? Which would give you more confidence? Making more sales or making more money? There's a difference here because sales is just how many sales you get, how many transactions, right? You can have five sales and each sale is$100. It's$500, but you can have one sale and make$10 ,000 on that sale and your revenue is more, of course,$10 ,000 more than$500. So ask yourself the question, which would motivate you more, making more money or more sales?

4:07Some people, it's sales. Some people, they're like, I just like the feeling that so many people, more than one person, likes what I have. This gives me the confidence to keep going and to keep building and to get feedback and to iterate. Some people say, no, money talks. If I make more money than I had in my day job with just one sale, that'd be a huge confidence booster. So you got to choose which one will make you feel more motivated. And guess what? If you can't choose, here's what you do. You flip a coin. Yes, you flip a coin. It's just important for you to get going. Get some results. This is how important momentum is.

4:45You need sales. You need customers. You need to prove it to yourself and to the marketplace that what you have is what people want. And that you have a viable business. Otherwise, you're playing business. I've sold high ticket offers. I've sold low ticket offers. And they all have positives and negatives. Okay? 100 % for sure, it's easier to get more customers, more sales with low ticket offers. Because the barrier of entry is lower, there's more people that can afford it, there's more people that are willing to try it for a low price, and therefore you can get more customers. 100%. But it's actually easier in a lot of ways to sell a high ticket offer.

5:28Why? Because people that have money can value your product. They see the value. They're willing to invest. Also, when you make a sale with an actual high ticket offer, let's say your high ticket offer is$10 ,000, you have revenue now that you can invest into marketing and get new customers. With low ticket offers, you don't make that much revenue, so your reinvestment in marketing is pretty minimal. In a lot of ways, business is very mechanical. It's very input-based. You put a bunch of inputs in, you get a bunch of outputs. In this case, you do some inputs, meaning running some ads. You target the right people, target the same people that bought your other products and services or your first product and service.

6:08So every option, whether it's high ticket or low ticket, has its advantages, disadvantages. Having more customers with a low ticket offer gives you more iterations, more feedback, more of a chance to learn about what your customers want and don't want because you just have more volume of voices. But with a high ticket offer, you have less customers. So you don't have that as much. In my experience, high ticket offers, those customers, a whole lot less headaches. They're easier to deal with. They do the work if there's work involved, like training or coaching, because they're invested heavily. While a low ticket offer, you might get people that just buy things that they don't implement, like a book.

6:49People buy books, they don't read them. Not the best customers in the world. They're not getting you the results you want so you can get to simonials. So everything has positives and negatives. But when you're getting started, you got to just choose. This episode is brought to you by The Jordan Harbinger Show. This is a podcast you need to add to your rotation. It's smart, it's interesting, and it's by far, in my opinion, the best interview podcast out there. It's hosted by my buddy, Jordan Harbinger. I've known him for years. And in a lot of ways, I look up to Jordan. He's one of the best podcasters I know because he does his research.

7:23His episodes are really well done. He asks his guests questions that other shows just don't ask. It's almost like he's predicting what I want to hear from the guest and what I would ask him if I was in front of him. The Jordan Harbinger Show won Best of Apple in 2018, and it's for good reason. Let me give you some of my favorite episodes to get started with. I absolutely love his interview with T-Pain, the rapper. It's more than meets the eye. It's hilarious and such an education on how to live life. His interview with Matthew McConaughey was incredible, as well as his chat with Terry Crews. I also love his Sunday episodes.

7:56They're called Skeptical Sundays. The one he did on 5G was so, so good. I'm a huge fan of the Jordan Harbinger Show and Jordan himself. You can't go wrong by adding Jordan Harbinger Show to your rotation. It's incredibly interesting. It's never dull. Search the Jordan Harbinger Show on Apple Podcasts, Spotify or wherever you listen to podcasts. now here's the beauty of it once you choose let's say you choose low ticket offers it's not the end all and be all you just get started with low ticket offers let's say for example you sell an online course that's three hundred dollars people that take that online course and complete the online course these are golden customers you've solved the problem for them but they probably have other problems that need solving and this is where your next offer comes in whether it's a coaching program, whether it's a software, whether it's an in-person event or training, whether it's a service contract where they sign up for a year and you supply a service to them.

8:53There's so much to this. It gives you so many opportunities to move up the value ladder, so to speak. So you might want to start with a low ticket offer, but that's not the end all be all. You'll have that high ticket offer eventually as you build up. And if you look at any of the people that you follow, that you love in business, you look at their website, you look at their offerings, they probably have some sort of value ladder, meaning they probably have something that's really low, like a book and then a course and then a training and then a coaching and then an in-person thing and then maybe a software that they maybe created.

9:27There's different levels of offers and you move up the ladder as a customer from a free opt-in, from an email newsletter letter person on the list to a buying customer. And the goal here is that people go through the ladder and buy each product and get more and more value throughout the years. So you got plenty to work with, but you gotta get started. Okay. So to recap, choose what is going to motivate you, more revenue or more sales. If it's revenue, go with high ticket. If it's more sales, then go with low ticket. Can't choose? Flip a coin. Just get started. Get the ball rolling. Regardless of what you choose.

10:05Speak to your customers. Get on the phone. Email them. Ask them questions about their experience so that you can improve the product, the service experience for them over and over and over so the next customer comes in, it's even better. And the next and the next and the next. Thanks so much for listening to The$100 MBA Show. And thanks, Max, for your question. If you have a question you want to ask here on Q &A Wednesday, go ahead and email me over at omar at 100mba.net. I'll make sure to answer it right here on the show. If you want to keep it anonymous, just let me know. I can just use your first name or just say anonymous.

10:35The point is, I'm here to help, right? I got your back. And by helping you and sharing the answer with everybody on the show, I help others that have the same question in their head or maybe are encountering that problem or my encounter in the future. So go ahead and email me at omar at 100mba.net to submit your question. If you love this show, if you're getting something out of it, leave us a rating and review. Whether you're on Spotify or Apple Podcasts, Go ahead and give us some stars. Write us a comment. We'd love to hear what you think of the show. Thank you in advance for doing that. Before I go, I want to leave you with this.

11:08In my life, in business, most of the things I regret are not the things I did, not the things I took action on. It's the things I didn't do, okay? Taking action seldomly leads to regret. So always take action. Be an action taker. Try, iterate. Most things can be reversed, right? Those things are not permanent decisions. Get started. Get momentum. Make it happen. Thanks so much for listening. I'll check you in Friday's episode. I'll see you then. Take care.