Presenting product rates in particular ways can result in a subconscious response, encouraging shoppers to buy those products.
Making certain adjustments in presenting prices to customers is an excellent way to improve the perceived value of various products. E-commerce stores can take advantage of various pricing strategies to increase their profitability. This is where psychological pricing can be helpful.
Recent researches suggest that focusing on the price differences between two products rather than the full price can convince customers to opt for the higher priced product. For instance, if a shoe brand offers a regular pair of shoes for $70 and a high quality pair for $100, customers would be more willing to buy the latter if stores pointed out the upgrade only costs thirty dollars more.
Merely offering a 30 percent discount maybe effective but stacking two or more discounts like “10% for first time buyers and 20% for Black Friday” can tempt more people to buy your product. It is also worth keeping in mind that stacking discounts from low to high orders is a better option than stacking them from high to low.
Charm pricing means pricing products ending with the number nine. This tactic is also referred to as the “left digit effect” as it makes consumers pay attention to the first number rather than the last one. For instance, $2.99 seems closer to 2 Dollars rather than 3 Dollars.
This tactic is quite similar to charm prices. In this pricing strategy, a products price always ends with an odd number. Odd pricing is quite popular among e-commerce stores as it encourages customers to buy from them because their products seem “cheaper.”
This subtle and smart pricing tactic is often used by e-commerce merchants who want to upsell. When presented with a decoy, customers often change their inclination between 2 products. The primary purpose of placing a decoy is to make the other options look more attractive.
Psychological pricing does not always mean that you have to change your product’s price. Instead, merely comparing the price of different products can encourage shoppers to decide which product they want. Many companies create tiered pricing models, with each option specifically designed around the budget and needs of different customers.
For instance, a coffee shop offers a 7 oz cup of coffee for $3, a 13 oz cup for $4 and a 15 oz cup for $5, the 13 oz coffee cup would offer better value compared to the small coffee cup while the 15 oz cup would be better than the midsized cup.
In this pricing tactic, different products are placed side by side and arranged in a way that draws customers towards the option in the middle. For instance, a TV store has multiple options for shoppers to choose from, but has a preference for the product in the center. This means that the store most likely wants shoppers to be attracted to the “best option” as they might find the other two TVs unfeasible because of their higher prices.
Packaging different products as a single option and offering low rates for it often increases demand and improves revenue. Bundling can also be a convenient option for people because purchasing products together is more convenient than buying them individually.
While your pricing tactics may include market segmentation, spreadsheets and various other techniques, there is a good chance your effort will be wasted if you don’t consider customer behavior. Psychological pricing makes a massive influence on the purchasing decision of customers. Understanding how different customers behave can help you make a well-thought out strategy to increase your conversions and profitability.
While these strategies may seem straightforward and simple, they can be used for enticing customers into purchasing your product.
