When one thinks about pricing a product or a service, we might think that Price is the sum of production cost + cost of delivery + markup.
This is not always the case, especially for a digital product. The cost for a yoga class given online doesn’t really have a cost of production. The cost is based on your years of experience, the courses you took in your life as a teacher, your commitment, and care you put into it.
It also depends on how much value you give to your clients.
In a physical studio, a gym owner will need to see how much the outgoing is - how much they need to take home as a salary and they will base the number of lessons and the cost on that.
A class in central London will cost more per hour than a class in the Italian countryside. Online is a bit different as you don’t have many outgoings. Once you buy a good camera, a mic, and some other gadget to record your class, pay for your platform’s membership, you are done. Also, you don’t have a space limit on how many people you can train in one session.
KISS - Keep it super simple!
When you start off it’s important to keep it as simple as possible. You need to consider that it is probably a new medium for both you and your clients.
Offering one membership that includes everything will give your clients the possibility to try all your classes and for you to keep a simple schedule, eg 3 or 4 classes/week.
Then, once you are established you can add more classes and more tailored memberships.
Introduce beginner, intermediate or advanced memberships
If you teach for example Yoga and you plan to have 2 different classes one for beginners one for intermediate and one for advance. In this case, it might make sense to offer 3 different monthly membership, one each.
Introduce different journeys
Your virtual space can be anything you want. It’s a gym but also a yoga studio or a dance ballroom. You can have HIIT classes but also a pilates or yoga studio. You could host tango lessons or salsa lessons. In this case, you might have clients that only want to do HIIT and others who would only do yoga or tango. In this case, you can create a membership for each discipline. Do not forget to always add a flat membership that includes all for your eclectic audience.
Aim for monthly memberships
You can offer a variety of memberships weekly, biweekly, monthly, yearly... Weekly memberships give the customer the idea that it is a softer commitment but at the same time receiving a billing email every week reminds the customers that they are paying you every time and they are luckier to cancel the membership. We suggest starting with a monthly membership. Can make sense to create a longer membership 6 month or 12 months especially if customers know you already.
During this time you will get much feedback from your customers and it will make sense to adjust this initial setting according to your customers’ needs but keep it simple to start with.
Pricing for monthly/yearly subscription
Now let's cover the most important topic: pricing. The easiest way to calculate pricing is to count the number of lessons per membership time frame so
Eg. for a monthly membership, per month you offer to your customers, multiply this number for what you will charge per hour and apply a discount percentage, this percentage increases based on the membership duration, so for example if you apply a 20% discount for a month you should apply a 50% discount for a yearly.
Monthly - 20%
Yearly - 50%
10 classes*10= 80
Price for a Single Class
How to price a single lesson. Start thinking that customers are not willing to pay the same price of a physical studio (studios have extra costs such as rent, electricity, cleaning staff, etc.) but at the same time teaching online means reaching more students so more money per hour.
So considering what mentioned before. browse the internet and check the average price per hour of your online competitors and start from there. The prices vary also based on what you are going to teach and how maximum people you can teach in your group classes. If your target audience demands more accurate monitoring and you need to limit the number of attendees, you will set a higher price.
This is a practical example
Single yoga class cost 10 per hour
You run 2 classes per week and you will offer a monthly and 6 months membership
The monthly membership should cost 10 lessons for 4 times = 8 lessons for $10 = $80 Apply a discount 20-30% the membership should have cost $64 - 56
Try to set more appealing pricing for example $49 or $59
Monthly - 20%
6 months 30%
Yearly - 50%
10 classes*10= 80
Subscriptions vs packages
Many trainers and teachers out there offer packages of classes to their customers. This might provide a more flexible experience for the customers so they can spend these tickets when they want in a certain time frame.
This can help in managing a studio with more than one teacher and with different classes, like a token that gives you quick feedback on which classes are more popular
Sadly it also has some downsides. The major one is that, unless your tool has an auto-renewal option like WOFH, you need to get in touch with customers to advertise your classes each time which means spending a lot of time in the operation which will prevent you to scale your revenues and you won’t be able to know your monthly income and won’t be able to plan accordingly.
Having a membership model instead, it is the best way to generate a recurring income. Recurring income means professionalizing our activity. You can focus on growing your business, finding new customers, and teaching them instead of pushing customers. growing your business.
Choosing the right model is crucial and the decision needs to be based on different parameters. From a unique business perspective, a membership is the best way to grow your business, but it depends also on your actual customer database and what these people are used to.