Udemy's Course Pricing Model: How To Use it to Your Advantage
This post was updated to reflect Udemy's course pricing model in 2020. Enjoy!
One of the biggest concerns which Udemy instructors had was the way this would affect their online course revenues and sales. Prior to the pricing change there were many courses available offered on Udemy had courses available for a few hundred dollars (up to $300). In the wake of these changes, Udemy was forced to cut the price of their courses to a maximum of $50 for each course. It is not surprising that many Udemy instructors were dissatisfied with the limitation on pricing, to which Udemy later responded by settling with a minimum price of $199.99 dollars for all courses sold on the platform ( see their current pricing policies for courses here).
Before we get started take a look at Greg Smith's first reaction to the Udemy pricing changes in the year 2016. Even though Udemy has introduced more modifications in their pricing system in the past, his advice for using Udemy's pricing model to your advantage remain applicable today.
Why Udemy has changed its prices
It's a fact that the vast majority of Udemy students never pay an entire amount for a course. Here's what Gregory Boutte, the VP of Content at Udemy said about their current pricing system:
"Today pricing is inconsistent and complicated for students. List prices range from $9-$300 However, the reality is that 90% of sales occur with a coupon code, and at a price less than $50."
Since the start, Udemy has been notorious for its promotions offering huge discounts on courses. It's common to see them advertise courses at up to 90% off for the database of their customers. By doing this they've effectively taught clients to not purchase the course. Instead of spending the full cost the majority of customers sit and wait for an email with a promotion before making purchases.
The data has been confirmed by prominent instructors who are on Udemy and they agree with the conclusion that the huge discounting was an issue. John Colley, who teaches courses on entrepreneurialism and business strategies, thinks the revised pricing policy could help resolve this issue in the eyes of Udemy instructors.
"I think Udemy is repositioning itself, on the market, in order to avoid this very heavy discounting strategy. This is going positively for teachers."
Scott Duffy, another big supporter of their pricing model believes that, once the massive discounting culture goes away, instructors will start seeing more impulse purchases at fully-priced prices.
"We should start seeing students come to the site to buy things. Not looking for a coupon or deals or marking a course, but seeing things they are interested in and then buying it instantly. This will require some time for that to develop."
Phil Ebiner (one of the best teachers on Udemy) The instructor, who had set the price of some of his courses online for $300, told us that he doesn't often get natural sales for that amount. So he decided to test his new pricing strategy by dropping his courses at $25. He began to see more natural sales through these courses.
"By decreasing the course prices to under $50 and limiting it to only 7 choices between $20 and $50, instructors will have a clearer idea about how much to cost, simply based off of the limited options. Students will be more confident buying courses anytime they want, not only in sales. I'm looking forward to coming price adjustments and think it's the best option for the future of Udemy's growth (and the success of instructors)."
Why some instructors don't like the new pricing
It's now obvious that a lower price for courses doesn't affect sales of courses even for instructors who don't sell at full price anyway. But, there's a subset of instructors who actually make the full-price sales for their classes (at $300) It's those instructors that weren't very happy over the change.
James McAllister is an instructor in this category. McAllister teaches online courses in enterprise and business. In addition, his sales are consistently for his cost of $197. We spoke with him, this is what he told us:
"The issue with Udemy's latest pricing approach is that it completely disregards the Udemy instructor base that brings its own students to their platform. Some of us have spent many months, or even years, building credibility with our following and are able to justify the more expensive cost - not just because our following has been loyal to our company for so long however, we also have the ability to market the value of our courses."
"Selling my course at 50 or less is actually reducing the content and people start to wonder if it is of any worth at all. The thing is that, in contrast to some free or extremely cheap financial courses available on Udemy, I am not redirecting people to a more costly course. The information you will find within my class is the complete set of instructions on how to trade all the way through. It is why I only ever wrote one course and why I feel it has greater value than a number of courses some instructors seem to churn out."
Simon makes a great point, and we've seen the way that pricing plays an important influence on a purchaser's psychological and the perceived worth of a course. Higher priced online courses generally are thought to offer higher value than the ones that cost less. It's the same psychology that makes people invest hundreds of dollars in genuine iPhone instead of a cheap knock-off.
"On Udemy, I was providing a six-week art school-related training course which requires me to interact directly with students and provide hands-on critiques of assignments. A student's salary of $25 ($50 subtract Udemy's 50% cut) is not even minimum wage for my time."
Then what's the final word?
Clearly, there are positives and negatives to the pricing system that has been introduced. Some instructors say that it can bring in greater organic sales. Others correctly point out that it's going to devalue advanced courses.
Also, is Udemy's course pricing system good or bad for Udemy teachers?
Well, it depends.
But if your goal is getting your course noticed the course, then publishing it online on Udemy (or similar online marketplaces for course) does have some advantages.
How to use Udemy's pricing model for courses to benefit you
If you're a current instructor on Udemy and you're a current instructor, changes to their course pricing model isn't always a bad thing. Even though you're unable to price your courses for more than $199.99 USD does not mean that there's no reason to publish courses through Udemy.
Here is what we will give you:
This way, you get exposure on their platform without offering all the valuable information, help and knowledge for a reasonable price. You still earn a bit of money as well. Heck, if your only concern is the exposure, you could offer your Udemy course accessible for absolutely free. If students who have taken the course are looking to advance their knowledge up a notch, invite students to take a look at the larger version of the course on a platform that you control (just ensure that you comply with Udemy's rules of usage).
While you can make money by selling your courses on Udemy, that shouldn't be the primary goal. A better reason to have an online course on a marketplace is for the opportunity to be exposed to a large audience and to grow your brand. A marketplace for online courses is much more of a marketing channel for online course creators than any other.
Once you have that exposure, and you've established a name that you're able to take people to your customized website where you can sell your premium programs.
What if you want to sell your online course at a price higher than $50?
The likelihood is that you've worked for years to acquire the knowledge and skills that have enabled you to create your course at all. If you've provided sufficient value for your class to be able to justifiably charge a higher price (a price that consumers would be willing to be willing to pay), then you should certainly have the ability to charge what you like.
Choose an online platform such as , where you have full control over your courses, students, and pricing. No one is going to restrict you to increase the price of your class. It is possible to create an online course for $2,000 like Arel Moodie, and sell it on a 6 month installment plan that costs $375 per month.
The bottom line
In the final time, Udemy is a marketplace. Similar to any online course marketplace it is completely in control on their rules and limitations as well as the prices of courses sold through their platform. It's the way they operate and they can change the rules if they think it will benefit their customers as well as their instructors and their students.
You, as instructors have a choice. It's not necessary to be with Udemy even if you do not want to. At the same time there is no arrangement with Udemy which means you are able to sell your courses there and also on your own site using your own prices.
The question is... do you make courses available through Udemy or through your own platform instead?
Our suggestion:you don't have to pick one or the other.
Use Udemy to promote your business for bringing traffic to your branded site where you could build a successful and long-lasting enterprise that you are in control of. With , you can create your own branded website within less than an hour!
What do you think of Udemy's current pricing model?
