What is a pricing technique to promote purchasing behaviors of people backed by experiments?

In order to sell goods and services and make the most profit, it is necessary to find "optimum price". Based on various experimental results, Mr. Peep Raja of the founder of the CXL Institute presents an effective pricing method that utilizes human psychology to lead to purchasing behavior.

Pricing Experiments You Might Not Know, But Can Learn From
https://conversionxl.com/blog/pricing-experiments-you-might-not-know-but-can-learn-from/

◆ Decoy plan to make comparison easier
To MIT students, several kinds of subscription plans of The Economist magazine were set up, and an experiment was conducted to find out which one is best chosen.

The first experiment showed how to subscribe to A plan "online version" ($ 59), B plan "print version" ($ 125), C plan "print version + online version" ($ 125) 16 out of the students selected the A plan and 84 selected the C plan.

Here, when we deleted B plan that no one selected, only present A plan and C plan, the plan selection has changed greatly with 68 people choosing A plan and 32 people selecting C plan . In other words, "It was understood that there were B plans that seemed meaningless because they were not chosen by anyone, so we succeeded in selling more expensive C plans a lot" and to earn more subscription fee So the B plan had a big meaning.

The lesson from this experiment is that people have a hard time comparing multiple plans, but if two of the alternatives are similar, it will be easier to compare. In the example of MIT, there are two plans with the same price, making comparison easier and making it easier to decide that C plan is obtained.

Next, an experiment was asked to ask people to choose between A Plan "Paris Travel" and B Plan "Rome Travel". As Paris and Rome are attractive sightseeing spots, it seems that many people had difficulty in choosing.

Here, the researchers who conducted the experiment added experiments by adding one plan to the A plan "Paris tour with break", A-plan "Paris tour without breakfast" and B plan "Rome travel with breakfast" However, overwhelming majority of people have come to select A plan. I added that I added a bad A-plan similar to A, so that it became easy to judge that A plan is more attractive and it got chosen.

The lesson of the experiment above is that if the seller has services or goods he wishes to sell, placing a "decoy plan" gently next to it is effective .

◆ Magical Number '9' and Regular Price <br> When I go to a supermarket I notice that the price of many goods ends with the number '9'. For example, even though there is no so much price difference is $ 39 and $ 40 actually if you gave them the price to the same product, by far the $ 39 it is that good sales than if $ 40 experiment I heard that you know. The effect of such a magical number "9" has been known for many years, but more effective way to use numbers is being investigated.

For example, if you add a price price of "48 dollars" as a regular price and add a price tag named "40 dollars" as a regular price as shown below, how much a magical number "9" is used and the price is cheaper 39 dollars Experiment has confirmed that sales will be better than in the past.

It seems that the magical number "9" is beaten, but it is confirmed that it is more effective if "39 dollars" ending in 9 is set as the sale price. In other words, we have succeeded in encouraging purchasing behavior more aggressively by matching techniques.

According to the research by Clark University and Connecticut University, we know that it is the smallest letter in the normal price, and if you use the bold font, it leads to the most purchasing behavior .

◆ Contrast effect and anchoring - Prepare three bowls of cold water, lukewarm water and hot water, put the left hand in cold water, put the right hand in hot water, wait for a while and then put both hands into a lukewarm bowl , The left hand feels warm, while the right hand feels cold. Such a "contrast effect" will work for the price as well.

For example, if there is "$ 150 hamburger" in the menu, "50 dollar steak" generally appears to be expensive but it seems reasonable price. For luxury brands with tens of thousands of dollars bags, a $ 98 T - shirt may also look cheap. By utilizing such a contrast effect, it is possible to make objects feel cheap. If you want to sell a watch of 2000 dollars, you can put a watch with a price tag of $ 12,000 next to it.

Also known is the effect called " anchoring " in which the information given earlier influences human value judgment.

In an experiment to evaluate the value of the housing to be sold, if we give the list of neighboring house prices currently being sold, we know that the higher the list price, the higher the value of the valuation though it is the same housing.

In other words, it is advantageous to sell high-priced goods that do not have to be sold in high-priced items, or to sell high-priced items to price negotiations so as to offer higher prices first .

◆ service VentureHacks to the advice to the simple pricing <br> startup, which was three set the service price is whether the most effective of the experiment was. In the experiment, "One plan of 49 dollars a year" "Two plans of 49 dollars and 24 dollars per year" "49 dollars a year, 24 dollars a year, three free plans later billing 3 plans" prepared and compared " One plan seems to have been the most profitable. In this experiment, in a recent world that is too complicated and fast , there are cases where people want "what is simple" .

◆ 3 price system <br> Price test of beer sales shows the value of three price ranges. When I sold "2.5 dollar premium beer" and "1.8 dollar bargain beer" in the experiment, about 80% chose expensive premium beer. Here, in addition to these, adding "1.6 dollar super bargain beer", this time around 80% buy a beer of 1.8 dollars, the rest buy a $ 2.5 beer and no one buys cheap items It was. If you make the beer you add be not a cheap item, but a super premium beer of $ 3.4, most people choose a $ 2.5 beer, a few people choose a $ 1.8 beer, about 10% a super dollar with a $ 3.4 supermarket It seems he chose a premium beer.

From this experiment, there is always a person who chooses the most expensive item regardless of the price . Furthermore, it is pointed out that by proposing multiple price zones, it will not only make a choice whether to sell the product of the seller in the first place, but also to choose which one to buy from the seller. In addition, if there are products that you really want to sell , it is said that it is better to place an intermediate price in 3 price system .

◆ Contextual Premium Experiment (PDF file) about the difference in prices accepted depending on the situation where a friend who promised to buy beer and drink on beach bought a beer. Even the exact same beer confirmed that the latter purchased the more expensive payment between the case where the store purchased was "local small grocery store" and the case where it was said to be "luxury hotel" It was.

From this experiment it seems that there are cases in which it is effective to make it accept a high price by applying cost that seems useless luxury, for example, web design and packaging with a sense of quality.