Magic #7? What are Best Practices for Pricing Your Products & Services?

3 replies
I've come to a wall with how to price my services. Some people say to price things online using the magic #7. As in $47 instead of $50 or $497 instead of $500.

Others say using 9 works as well. ($49 vs $50).

Still others say to make it look like there was a ridiculous amount of calculation involved and have the price be something like $48.16.

I like to think that people are smart enough to know the difference. Like can't I just call it $500 and people will get that I'm just being straight up? Or should I really do the $497/$499/$498.19 thing?

What are your thoughts?
#magic #practices #pricing #pricing structure #products #services
  • Profile picture of the author JPaston
    Depends who you talk to (as always).

    I have a friend who thinks that something priced at $49 is "only $40", in other words she only sees the first digit.

    I have another marketer who told me that no-one is fooled by $9.99 and react much better to an 'honest' $10.

    If you go by the majority of sales made in Internet Marketing the magic '7' seems to hold precedence. $7, $17, $27, $47 and $97 are the major price points. There seems to be some comfort in numbers like that.

    Jonathan Leger must have called his product '$7 Secrets' for a good reason!
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  • Profile picture of the author J Bold
    It's psychological. Yes, people will know, they are not stupid. But the argument is that even so, there's something psychologically advantageous about using a 9 or a 7 at the end of your pricing.

    You know what work better than trying to argue with yourself about it?

    Test and see for yourself.
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    • Profile picture of the author Ralph Moore
      $9.95 or $9.97 will almost always beat $10 for most people in consumer markets.

      It has been tested, long before the age of the Internet.

      It IS psychological and I cannot remember the technical term at the moment.

      It also adds the benefit of "Less than 10 bucks" advertising, etc.
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