pricing

Using Psychology in Your Pricing

 

The best marketing tactic you can use is psychology.  Psychology can be applied to the colors we use, the images we have, and even the pricing.  Have you ever wondered why businesses price the way they do?  They usually utilize the same tricks that are based on basic psychology.  These aren’t ways everyone is trying to be the same, they are proven tactics to encourage customers to buy their products.  Doing simple changes can drastically improve a customer’s perception of whether your product is worth the buy.

If you want to improve your pricing to increase more sales, check out these five tips below!

Change Pricing by 1

This is probably the most used pricing change to encourage customers to purchase from you.  You’ve probably seen the pricing in an advertisement at $9.99.  This is not a random number.  By reducing the pricing by one, it drastically changes whether or not the customer will purchase the product or service.  It makes the pricing appear cheaper or more affordable.

Payment Plans

If you have a product that can be considered pricey, you may want to consider advertising payment plans.  When customers see a payment plan option, they will be more likely to make the purchase. They won’t pay much attention to the larger lump sum price.  While displaying the total price, have the payment plan option nearby so that they see the smaller amount, which makes them think it’s really more affordable.

Take Away The Comma

By taking away a small symbol, it can drastically change the way potential customers see the pricing.  Can you see how $1500 looks more enticing than $1,500? Why would this look and sound better?  It reduces the number of syllables.  The easier and quicker it is to say, the more likely customers are willing to purchase the product.  With the comma, we would pronounce the number as one thousand five hundred.  Without it, we would say fifteen hundred.  We have just reduced the syllables to four!

Show Cost Differences Distinctly

This trick works very well when comparing your price to your competitors or when you are having a sale.  Have the original price in your normal font size and color.  Now, put the sale or comparison amount in a different size and color.  This not only brings attention to the sale price and showing how much of a savings your customers would get, it makes it easy to decide if the pricing is right for them.

Less is More

When we say Less is More, we mean using words that express a low amount.  Any words like “low”, “less”, or “small” can greatly change the perception of the price and how it would benefit the customer.

When we understand the psychology behind deciding the cost of products, it makes more sense to carefully craft what we advertise to increase sales. Take some time to see what you can do with your wording and pricing.  The changes may shock you!

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