Emotion and pricing
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The document discusses the emotional science behind pricing, emphasizing that most purchase decisions are made subconsciously and that perceived price fairness can cause physical pain. It highlights techniques like decoy pricing and anchor pricing to influence buyer behavior, suggesting that precise pricing and careful choice of options can enhance perceived value. Ultimately, aligning pricing with the overall value proposition is crucial for effective marketing.
Emotion and pricing
- 1. The emotional science of pricing Topi Järvinen Nestholma Venture Accelerator
- 2. The emotional science of pricing
- 3. 95 percent of all cognition occurs in the subconscious mind. Gerald Zaltman Harvard Business School
- 4. 95% of purchase decisions are made without concious awareness
- 5. If price is perceived to be too high, it causes physical pain Confidential5
- 6. Pain-relievers for buyers Confidential6 • Perceived fairness • Bundling (hard to assess) • Credit
- 7. Pricing is pain management Confidential7 Discounts have to have pain associated with them
- 9. Use pricing that seems more precise. It’s perceived to be more credible Confidential9 499€ 501€ 500€
- 10. Guide the customer with decoy pricing The Economist pricing experiment Confidential10 16 0 84 68 32 N=100 Ariely: Predictably Irrational Subscriptions (test #1) Subscriptions (test #2)No of times the option was chosen No of times the option was chosen
- 11. Decoy effect in action Confidential11 7,99 Basic 9,99 Pro 99,99 Enterprise
- 12. Anchor pricing Confidential12 •Establish a baseline •After a $599 iPhone, a $299 iPhone seems like a steal
- 13. Our brains aren’t good at judging absolute values, but they are always ready to compare values and benefits. Roger Dooley Brainfluence Confidential13
- 14. Align your pricing to fit your overall value proposition • Choose the choices carefully! • Too many or too little may turn your customers away vs.
- 15. Contact Topi Järvinen +358 40 754 3131 [email protected] http://www.nestholma.com