The Persuasion Lab with Martin Medeiros
#90: An Introduction to Pricing Theory
Sep 2, 2021
Exploring the psychology of pricing, from verbal articulation to digit placement. Disaggregated pricing's influence on consumer decisions, with insights on segmented offerings. Precision pricing in real estate and the impact on sales outcomes. Delving into pricing psychology in e-commerce and the benefits of data-driven decision-making.
26:29
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Quick takeaways
- Verbalizing prices affects perception; syllable count influences size, left digit bias impacts magnitude perception.
- Disaggregating pricing by components and offering installment payments can make purchases seem more affordable and attractive.
Deep dives
The Impact of How Prices are Verbalized on Perception
Verbalizing prices can influence how they are perceived. Research shows that saying a price orally can make it appear larger or smaller, with fewer syllables signaling a lower price and more syllables implying a higher price. Additionally, the left digit bias in pricing psychology suggests that the leftmost number in a price significantly impacts how buyers perceive the magnitude, regardless of the following digits, illustrating the importance of linguistic components in pricing perception.
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