The two standard pricing models for continuity programs (things like membership sites where you re-bill customers every week, month, year, etc.) are a cheap or free first month followed by the regular price forever, and just charging the regular price from the beginning. Russell Brunson's presentation on Microcontinuity got me thinking about possible alternatives.

The first is one that I've already seen used: the one-time offer for lifetime membership.

The minimum price for your one-time offer is determined by how long the average member stays in your program. Price it no lower than what you'd earn from the average customer. Most people teaching how to run continuity programs say that the average member stays on for 3 to 4 months, but of course, this may vary from industry to industry and site to site.

So let's say you've been running your program for a while and have determined that your average member stays on for 4 months, paying $27 a month. You'd want to price lifetime membership no lower than $108 (4 x $27).

Exactly how high to price it is another matter, probably best determined by testing. If raising your price doesn't decrease sales significantly, you might find that you can make more by selling lifetime memberships at $197 than at $127, for example.

If you add a lifetime OTO option, you'll want to track the effect, if any, that it has on how long people who don't take the offer stay on. Is the OTO cannibalizing only people who stayed on for 8 months, for example? If so, you might need to price it higher to make it worth offering. If, on the other hand, the OTO primarily catches people who would have cancelled after the first month, you're in great shape!

The second pricing model is one I'm trying out right now on Affiliate Landmine (which I have a reseller license for) -- sell the first month expensive, and the rest cheap.

The "standard" price is $19.95 a month. There are resellers are selling it for that price, but most are selling the first month cheap (usually $1) and then jacking it up to $19.95.

When I first started selling Affiliate Landmine, I set my price at $7.00 a month with no cheap first month. I advertised the fact that unlike everybody else, I wasn't going to jack the price up on you the second month. I discovered that despite the lower monthly price, most customers still canceled after a few months.

What I'm trying now is the exact opposite of what everyone else is doing: I charge $12.97 the first month, but after that, each month costs only $1.97.

The idea is that once somebody's paid $12.97 to get through the door, $1.97 to stay on is cheap by comparison. Plus, there's the fear of canceling, because if you decide you want back in later, you'll have to pay $12.97 to get started again. Of course, I'm also pointing out that even the first month costs less than the standard price of $19.95.

I don't have enough results yet to say whether this works, but I figure it's worth trying.

My third pricing model is a variation on the second: sell the first month cheap, the second expensive, and the rest at a low to mid-range price. For example, the first month might cost $1, the second $27, and then $7 a month after that.

The idea behind this model is to get people in the door with the lowball offer, make the profits you should have gotten the first month in second month, and then keep them on as long as possible with the lower repeating amount.

But there's something a little devious about this model. Many customers of continuity programs with cheap or free first months cancel before they ever get billed for the second month. There's not much you can do about that.

Where this model may shine (I haven't tested it, so I can't say "shines" yet) is in the second month. Of the customers who don't cancel before being billed for the second month, I'll bet the next largest group cancels immediately after being billed for the second month. They may have forgotten to cancel, or they may have decided to cancel only after they actually felt the "pain" of paying full price for a month.

This model could make more from that group in two ways: one, by grabbing as much as you can before they cancel (yeah, a little sneaky -- I'll bet you'll get more people asking for a refund of the second month from this group), or two, by making them think, "oh shoot, I forgot to cancel. Oh well, at least it'll be cheaper from here on out." Still a little devious, but if you're delivering enough value to make it worth paying your ongoing monthly fee, that's fair.

A tactic you should use regardless of your pricing model, but especially with that last one is to give bonuses every few months to people who stay on longer. And always be sure to let them know what's coming if and only if they renew for another month.

With the "low-high-low" pricing model, make that second month bonus a monster to get people over the hump. Also, if you remind members of the big bonus shortly before billing them for the second month, you avoid any possible ethical issues with billing people who intended to cancel but forgot.

Russell's microcontinuity model that I mentioned at the beginning is another option that has a lot of advantages over standard continuity programs. I highly recommend going there and watching his video -- you'll get some great ideas from it.