How to forecast your online course earnings
Is considering creating your own online course? Great. But if you plan to take the idea really seriously, the first thing that you have to do is sit and define what will be the theme of the course and what will be required to do this in the right way.
If you already know exactly what you’re going to teach in your online course and what your target public is, that is already a good start. The next step is to find out how much it will cost to create, disclose, and provide support and to continue to improve your course.
Choosing a price for your online course
To find the solution to this question it is necessary to answer three questions:
- How to price your online course;
- How many sales you need to make up for any costs for the course.
- How much you want to invest in the course before creating it.
Start analyzing and responding to each of the questions.
The right price point for your online course depends on many factors, but here’s one way to think about it: if you want to make $1,000 from your class, do you stand a better chance by selling 100 people a $10 class or 10 people a $100 class?
Breakeven Point Analysis
A breakeven point analysis is a simple method to help discover how many sales will be necessary to reset the balance, i.e., recovers the money invested. See an example:
- Class sold for $100 (a one-time transaction)
- Total costs to create the class are $700
- The breakeven number of sales are $700 / $100 = 7
Less than 7 sales, and you lose money, greater than 7, and you make money. Obviously there are more factors at play, but this simple analysis is an easy way to help you think about the viability of your online course.
Upfront and Ongoing Costs Analysis
Now that you have a sense of how much value you’re creating for someone, and how much you need to sell, now you can start to look more closely at your costs.
There are two components of costs: upfront and ongoing.
Upfront costs are your investments into creating the course, like: create a website, create promotional materials, videos production, value of your time, etc.
Ongoing costs are your costs on a monthly basis to keep the course running, like: transaction fees to process purchases, marketing, customer support, etc.
There are many different avenues to creating a online course. The key is to decide on the best way to allocate your time and resources.
For example, if you decide that create a website will cost you a lot of time and money, you can opt for an online platform (LMS) as the Coursify. A LMS offers several resources that will be needed to make your course available for use and purchase. In addition, it offers the possibility of you even create a custom layout for your page, which saves you costs with design. Add together the costs with LMS signature plan with design and maintenance and you will have the value that must be invested to create your course.
Now suppose outside all this, you decide to produce a promotional video. Costs to create a promotional video: $400. How to define if more that investment is viable or not?
Use your forecasts of costs and revenues to figure out how many additional sales it would take to make up the additional costs.
For example, if costs you $700 to create your course, the course is sold for $100 and to achieve the breakeven point you needed to sell only 7 lessons, investing in making a video meant that it only had to lead to a couple extra sales (400 / 100 = 4 sales). If you consider this number viable and valid by the benefit that video can bring to your business, invest.
The future of your online course
All these analyzes help define values and have a clear notion of costs and revenues, but also contribute to you think beyond the launch of it and plan how you will transform it into a long-term business.
Do this projection is a good way to test your commitment and willingness to do a good job and refine it increasingly, seeking a lasting relationship with your customers and a source of constant and growing income.
To make your work easier the Coursify offers a complete online platform for hosting online courses. Send an email to firstname.lastname@example.org and discover how we can help make your business more viable.