Is $27 The New Magic Number

$27 does seem to be a comfortable middle ground in terms of price points, just look around the WSO forum to see what I mean. You will find prices ranging from $17 to $47 and $27 seems to be the average.

Research shows that infomercial companies price most of their cosmetics products at $39 or less, this is so that it won't raise alarm bells with the husbands when they go through the monthly visa bills, interesting isn't it?, anything $40 and over seems to raise red flags so that ties in perfectly with the $27 price point, it's not too much of a financial stretch for most folks.

people seem like prices that end with a 7.
don't know why though.

Some friends have also told me they saw better conversions at the following price points..

Instead of...

$19.99 try $17
$29.99 try $27
$49.99 try $47
$99.99 try $97
$299.99 try $297

A couple of years ago I was selling a software product for $149.95 I actually increased the price to $197 and didn't notice a decrease in sales. I actually made more money. I can't stress it enough, don't be scared to test different pricing points.

I just purchased a product from Percy Belcher for that same price $27

Interesting feedback

Thanks Everyone

The psychology behind price numbers has been working for years.

In the offline world of direct marketing ( Mail Order ) the 9 is king. 9.95, 19.95, 29.95.

Online we found that 7 has done better than 9.

I even know one marketer that has a package that he sells online for $17 but the same product when advertised offline in magazines is still at the $19.95.

It's just like having the color red on your order form. "Only $19.95". Now for the Internet "Only $17". This is why the big red arrow works for opt-in forms.

Frank still uses one on his opt-in.

I do well with $195 online.
To me personally "7" at the and of an online price means "internet marketer is behind it - watch for scam".
But I am recovering...

Gleb

Nice one Matthew.
very well put...
at the end of the day, the price alone wont sell the product, but the figures show that these price points DO help.

$24.95 has actually been working better
for me than $27.00. I even did well with
a $25.00 price point.

However, $24.95 has proven that it's better
for me than $25.00.

Sometimes I will start a product as low
as $10 and continually raise it until I see
a major drop off in sales. It works for me!

I thought this was interesting. Found this on Google.

Research supporting odd pricing theory.

Kenneth Wisniewski and Robert Blattberg at the University of Chicago's Center for Research in Marketing showed that psychological pricing is one cause of price points.

A form of psychological pricing suggests buyers are more sensitive to certain ending digits.

When the price of margarine was lowered from 89 cents to 71 cents, sales volume increased a mere 65%, but when it was lowered from 89 to 69 cents, sales volume increased by 222%.

In another study, the perceived value of all the numbers between 1 and 100 were studied, and 77 was shown to have the lowest perceived value relative to its actual value.

Schindler & Kibarian (1996) tested odd pricing using three versions of a direct mail catalog for women's clothing.

The catalogs were identical except for the prices, which ended with 00, 99, or 88.

The version with prices ending in 99 generated 8% more sales volume and had more purchasers than the 00-ending version.

The 88-ending catalog produced a similar sales volume and number of purchasers to the 00-ending version.

My course is priced at $391 and it converts better than it did at $197

AgentG,

How many different variations did you try and did you do any testing with them?

Thanks

Matt

Bottom line is, test different pricing points. Test, test, test and test again. What-ever works for you, is what you should price your product/service at.

Learned a lot from this post

My very first product I was selling at $17.95. I increased the price to 27.95 and my conversions did not drop at all. I was going to up it another 10, but never actually actually did.