Tuesday, 28 August 2012

Does the world really need MRR products?

This post was originally a thread that I started on the Warrior Forum on Wednesday, 25 August 2012... before it "mysteriously" vanished a few hours later. It has most likely been deleted and I have no idea why... perhaps what I said below is "too controversial" for some... who knows. 

I've sent a message to the administrator of the forum for an explanation but have received no reply. So, I've decided to post the thread here. 

The whole reason for starting the thread on the Warrior Forum, was to get feedback. There are a lot of PLR and MRR related Warrior Forum Special Offers that happen on the Warrior Forum, so I thought that would be the best place to get feedback. 

Since the thread is no longer on the forum... if you would like give feedback to the questions which appear at the end of the post, feel free to post a comment (I'm curious to know what you think, so any feedback is appreciated)

Here's the post: "Does the world really need MRR products"

I'm not entirely convinced that there is a need for Master Resell Rights licensed products. Here's why I think that a MRR license is actually not that useful:

What is the point of a MRR product? It gives the customer the ability to sell the product. Great right? But, unlike PLR products, the MRR product cannot be altered in any way... which means there is no way to differentiate the product. So, every person who bought that product with the intention to resell the product, is competing against each other selling the exact same product.

Price Dilemma for a reseller
Since the product is the same, at least some of the sellers will try to compete on price. So, at least some of the sellers will end up selling the product for as low as possible... like $1.

Let's assume that you are one of those who is reselling the product for $1. In order to make money now, you have to increase the volume of sales which is probably going to be difficult. You're not the only one selling the product... so it's going to be difficult to stand out. Plus, you are competing with all the other similar products that's being sold in that niche.

If you can't expect a large amount of sales, do you increase the price? Well, I suppose you could try to sell it for what you think it's worth.

But, given the nature of a MRR license, where customers become sellers and their customers also become sellers... the internet is probably flooded with the product. So, if you sell it for $5 because you think it's worth it, but a potential customer sees another website selling the same product as you for $1, who do you think they are going to buy from?

So, even if you price it at what it's worth, you may still struggle to make even a few sales.

Okay, so do you sell it for less than it's worth, just to make sales? Well, even if you sell it for below what you think it's worth, you may still struggle to make a few sales, because the customer may doubt the value of a low priced product.

Built in problem
The problem with MRR is that, by it's nature, it encourages large amounts of competition selling the exact same product, which makes it hard for any reseller to sell.

Is there really any benefit?
What is the benefit of reselling a MRR product? Is there any? Firstly, the license allows customers to become sellers... so stiff competition is a given. Is the benefit in being able to set your own price? Hardly. If you set a high price... you'll struggle to make sales. If you set a low price, you may make a few sales, but given the high competition... you'll struggle to increase your volume of sales.

I see being able to set your own price as a disadvantage rather than an advantage. So, how is reselling a MRR product better than say... an affiliate program to a similar product. At least when you promote an affiliate product, the price is stable. Plus, you don't have to worry about product delivery or customer support.

So, I'm not convinced there's much value in reselling a MRR product.

Even though the primary purpose of MRR products are to be sold, I think it's better to use in your marketing efforts, such as a freebie or bonus, instead of trying to sell it. But, that is just my opinion.

As a creator of a MRR product
Now, if there is not much benefit for a reseller, surely there's benefit for the creator of the product? No... lot in the long run anyway. Think about it, if your customers become resellers, then the more you sell, the more competition  you have selling the exact same product as you.

So, the only chance you really have to make a lot of money is a short period after the product is launched. The more time that passes, the more competition and the harder it is for you to make another sale.

So, if you do attach a MRR license to the product that you create, you may attract more sales in the beginning because of the "includes MRR" but don't expect sales in the long run. Expect your sales to be short lived.

It would be far more profitable for you as the product creator to sell the product yourself and offer an affiliate program, instead of selling the product with MRR or RR. At least that way, you can expect to make sales over a longer period.

There are only 2 reasons that I can think of, that would make someone want to sell a product that they created, with MRR as apposed to just selling it themselves:

  • the product created is an "average" product
  • they don't care about sales but exposure and getting the product out there to as many people either because they branded the product or they included affiliate links in the product. (they branded the eBook)

I know it may seem harsh to say that a product creator selling their product with MRR created an average product... but logically, it makes sense. Think about it, if you created an awesome product that you know would make a lot of sales, why would you want to lose all those sales by offering MRR to the product?

Now, I'm sure you can probably find some good MRR products... but the only reason I can think of, that would make someone create a good product and then offer MRR, is because they care more about exposure than about sales.

A better solution to MRR - Limited Resell Rights
If a MRR product doesn't benefit a reseller and it only provides the creator of the MRR product with sales for a short period, who is actually benefiting from the MRR product?

I think that a resell rights license, where only a small number of licenses are sold, will be far more beneficial to you as a reseller, since competition is limited. As the creator of the product, you can charge a higher price, because you're limiting the amount of licenses sold... so you still make money. And, since each reseller is charged more, they want to make sure that they make their money back, so they are less likely to sell the product for a very low price.

A better solution to MRR - PLR
At least with a PLR product, you can differentiate yourself, increase the value, add more content, package the product better.

My questions to you
So, even though I don't see much benefit to MRR, I'm curious to know that you think about MRR products.

My question to everybody: Is there a real need/benefit to MRR products?

I have a question to all those who actively resell MRR products. I'm not talking about those who create and sell MRR products... I'm talking about those that buy MRR products and then resell them:

Question: What are your sales like, when you resell products and do you sell the product with or without MRR (i.o.w are you passing on MRR to your customers)?

Here's 2 questions to all those who create and sell MRR products:

Question 1: Why do you offer MRR/RR to your products, instead of just selling them yourselves and offering an affiliate program?

Question 2: How long (in days) does it make before your sales drops from the period the MRR product is launched? Or, what are the sales trends like from the time the MRR product is launched?

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