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Pricing

Is This Common Pricing Mistake Costing You Sales?

By |April 4th, 2013|

If you have an ecommerce site, how often do customers visit – often after a costly paid click – and end up leaving without buying? Are abandoned shopping carts all too common? Or, if your customers visit your retail store, how often do you see them compare several items, only to buy none of them and move on? If you stock similar items (and who doesn’t?), the problem could be your pricing. […]

Taking the Pain out of Sushi Pricing

By |February 13th, 2013|

The menu designer for an Austin restaurant, Roll On Sushi Diner, must be a Neuromarketing or Brainfluence reader. A while back, I identified sushi-style pricing as being the worst possible approach because each tiny bite is a separate pain point (see Painful Sushi and Other Pricing Blunders).
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What Pricing Strategy Beats Discounts?

By |November 15th, 2012|

If you want to sell more product by running a sale, which would make more sense: advertising “price cut 33%” or “50% more” product? Functionally, the two are the same level of discounting. Researchers at the University of Minnesota found, though, that a “50% bonus pack” sold 71% more than a “35% discount,” even though the latter is a slightly lower price per unit. […]

Pricing Lessons from Restaurants

By |January 7th, 2010|

My last Neuromarketing post, Neuro-Menus and Restaurant Psychology, talked about various things restaurant menu engineers do to maximize sales and profits. I think it’s worth calling special attention to one aspect touched on in that post: how price presentation affects sales. Not, the price itself, which of course is very important, but the way the price is displayed to the diner. […]

Anchor Pricing Strategies

By |July 18th, 2008|

Here’s a scenario… You decide to venture into a cell phone store despite your reluctance to deal with a bewildering number of phones, options, plans, along with a confusing price structure. As usual, you find you’ll have to wait a bit for a salesperson. The greeter hands you a card with a big “97” printed on it, and says, “It should only be a few minutes. We’ll call your number, 97, when a salesperson can help you.” You notice that a large digital display on the wall is showing “94.” You see it click to 95, then 96, and finally 97. The receptionist says, “Number 97, please,” and a salesperson appears to assist you. You thought nothing of the numeric ordering of customers, but it’s possible that the store had an ulterior motive: they could have been attempting to manipulate the price you would pay. Sound bizarre? Read on…

When a consumer is presented with an offer, a key element in the decision to accept or reject it is whether it appears to be a “fair deal” or not. We know that buying pain – the activation of our brain’s pain center when paying for a purchase – increases when the price seems too high. But how does that value equation work? The answer is anchoring – typically, we store an anchor price for different products that we then use to judge relative value. That sounds simple enough… but it’s actually not. Some anchor prices are stickier than others, and at times totally unrelated factors can affect these anchor points. The better marketers can understand how anchoring works, the more creative and effective pricing strategies they will be able to develop. […]

Precise Pricing Pays Off

By |April 28th, 2008|

In my time as a catalog marketer, I almost always priced products just below the next dollar increment – a cheap item might be $9.97 rather than $10, while a more expensive item may have been $499, or even $499.99, instead of $500. My strategy was based on a couple of assumptions. First, I thought that there was probably something desirable about offering, say, a “nine-dollar-and-change” price vs. a “ten-dollar” price, i.e., even though the difference was only a few pennies, some customers would perceive the $9.97 price to offer more substantial savings. Second, I observed that big marketers like Sears, who could afford to test any number of pricing options, tended to stick with the “just below the next increment” approach. As it turns out, I was right, but for the wrong reason. New research points us toward the reasons why consumers respond better to a $499 price vs. a $500 price, and it has more to do with the apparent precision of the odd number: […]

Painful Sushi and Other Pricing Blunders

By |March 27th, 2007|

What’s the worst way to sell something? According to Carnegie Mellon University economics and psychology professor George Loewenstein (see The Pain of Buying and Brain Scans Predict Buying Behavior), selling products in a way that the consumer sees […]

Pricing, Ego, and Emotion

By |November 6th, 2006|

Neuromarketing and Pricing. Why do people sometimes set prices that are too high, and then stubbornly stick with them despite evidence from the marketplace that the price is indeed wrong? Neuroeconomics research tells us that financial decisions […]

Blueprint to Explode Your Niche Site’s Traffic, More – Roger’s Picks

By |December 19th, 2014|

Do you need a blueprint for driving mega-traffic to your niche site? Real-world examples of effective use of social proof? How about a product/pricing strategy that seems illogical but drives sales? That, and lots more, is in this week's picks post.

Content Multiplication Magic, Happy Design, More – Roger’s Picks

By |December 5th, 2014|

We’ve got a double dose of great content for you this week. We didn’t publish a roundup “picks” post last week due to the U.S. Thanksgiving holiday. Here’s what you don’t want to miss: […]