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Price Points and Scales

by Craig Brower
3 replies
Does anyone have any information or links they know of that explain the mentality of potential buyers based on price points.

For example..."It is better to set your price at XXX instead of XXX because people will think xxxx"

I'll give you an example of how it worked for me recently. I saw a used game selling for $8.95 and didn't buy it, I knew it was inexpensive but I decided not to buy it. I then saw the same game for $10 and bought that. Basically I just said...Screw it just do it, it's only 10 bucks dude.

I'd love to know your thoughts
Craig
#points #price #scales
  • Profile picture of the author E. Brian Rose
    I posted this in another thread recently, but it applies to your question too, I think...

    I was selling medical equipment online to the seniors market. I had many devices private labeled for me. It was the exact same equipment being sold by doctors for ten times the price, but it just had my label on it.

    I undercut the hell out of those docs and thought that my products would fly off the shelf. They didn't. At least not right away.

    That's when I decided to try a little test. I raised the price. In fact, I tripled my prices. They were still lower than the rest of the industry, but triple the price that I sold for just the day before. I didn't make any changes to any of my advertising or marketing. I simply tripled my prices.

    Guess what else tripled? Yup, my sales. INSTANTLY!

    I learned that people want a bargain, but they also want to feel like they are getting a bargain on something of quality. My original prices were so much lower than the rest of the industry, they must have thought that the quality was that much lower too.

    I guess the takeaway here is for you to always test the elasticity of your pricing and find that sweet spot. Proper pricing on quality products is your key.
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    Founder of JVZoo. All around good guy :)

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    • Profile picture of the author Craig Brower
      Hmmm that is very interesting. I have heard of ways before of changing the price structure and charging even more than the initial price and getting more sales.

      I am also wondering why people may see numbers different. I actually see Walmart is doing this. I need to get a pair of sweatpants, and noticed that the price for them was 12 even, not 12.49 or 11.79 or something. There must be something with a straight number without the .cents behind it too that causes some type of psychological response.
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      • Profile picture of the author janessecret
        You've got to spend time looking at your competitors and their pricing structure, if you're looking at marketing a new product then look at similar products and charge accordingly.
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