Do you use psychology when pricing your copywriting services?

27 replies
Psychological pricing has been proven to affect perceptions of product value and affordability.

The dif between a product price of $1,998 and $2000 may not be much, but it can make a difference in the minds of buyers, and even affect purchase decisions.

You guys probably know ... Level, even prices (e.g. $2000) can make a product seem more prestigious. Prices ending in "99", "97" and "98" make a product seem more affordable and more of a value. Prices ending in very specific numbers (eg. $57.87) convey that you've thought hard about the price, calculating the product's true value carefully (and authoritatively).

...but what about when it comes to quoting prices for your copywriting services? Do you use psychological pricing at all?
#copywriting #pricing #psychology #services
  • Profile picture of the author Alex Cohen
    Originally Posted by splitTest View Post

    ...but what about when it comes to quoting prices for your copywriting services? Do you use psychological pricing at all?
    Of course.

    Using persuasion techniques is the key to getting decent fees.

    Starts with positioning, carries through the lead generation process, and culminates during the client phone conversation.

    Alex
    {{ DiscussionBoard.errors[9530598].message }}
    • Profile picture of the author splitTest
      Originally Posted by Alex Cohen View Post

      Of course.

      Using persuasion techniques is the key to getting decent fees.

      Starts with positioning, carries through the lead generation process, and culminates during the client phone conversation.

      Alex
      Well, how so? (...Or that a trade secret?)

      I'm thinking that ending a copywriting fee in "99" would come across as a bit disingenuous somehow for a consulting service as opposed to a physical product. Clients are more aware of the flexibility you have in pricing your time, so "$799" may seem more like "gouging" for that extra hundred than a flat price of "$800." It can even seem insincere.

      I'm not familiar with the ways other consulting services price. Are you guys seeing "psychological pricing" for other services where the only real "product" is time, legwork and expertise?
      {{ DiscussionBoard.errors[9532904].message }}
      • Profile picture of the author kodbel
        Originally Posted by splitTest View Post

        Well, how so? (...Or that a trade secret?)

        I'm thinking that ending a copywriting fee in "99" would come across as a bit disingenuous somehow for a consulting service as opposed to a physical product. Clients are more aware of the flexibility you have in pricing your time, so "$799" may seem more like "gouging" for that extra hundred than a flat price of "$800." It can even seem insincere.

        I'm not familiar with the ways other consulting services price. Are you guys seeing "psychological pricing" for other services where the only real "product" is time, legwork and expertise?
        I think it always has a positive impact on "psychological pricing" like "99". The purchaser thinks it is below 100 at un-concise mind.
        {{ DiscussionBoard.errors[9535757].message }}
  • Profile picture of the author KreativCopy
    Originally Posted by splitTest View Post

    ...but what about when it comes to quoting prices for your copywriting services? Do you use psychological pricing at all?
    Absolutely. But it is more about breaking down the fee and showing what value you are providing to the client. Just saying my fee is blah blah is not enough...even if it does end in .99.

    Copywriting is all about the subtle art of persuasion and taking the reader on a journey...and the first traveler on that journey is usually your client.

    If you cannot persuade your copywriting client that you are worth it...then how are you going to persuade your client's prospects that their product is worth the paper it is written on (so to speak).
    {{ DiscussionBoard.errors[9532808].message }}
    • Profile picture of the author splitTest
      Originally Posted by KreativCopy View Post

      Absolutely. But it is more about breaking down the fee and showing what value you are providing to the client. Just saying my fee is blah blah is not enough...even if it does end in .99.
      You break down your copywriting fee? (Into what parts?)

      ...Or are you offering other services along with your writing?
      {{ DiscussionBoard.errors[9532905].message }}
      • Profile picture of the author KreativCopy
        Originally Posted by splitTest View Post

        You break down your copywriting fee? (Into what parts?)

        ...Or are you offering other services along with your writing?
        It depends. But I always show the client exactly what they are getting and the value to them. It is a good way of managing everyone's expectations too.
        {{ DiscussionBoard.errors[9533937].message }}
  • Profile picture of the author FreedomBlogger
    That would be a big YES.

    You should use these techniques at all times - they are there so we can use them, so we must use them!

    LOL

    Cheers!
    Signature
    At the beginning, I thought making money online with a blog was super super hard. Not anymore. Learn the art of making money online blogging - step by step - HERE.
    {{ DiscussionBoard.errors[9532910].message }}
  • Profile picture of the author quadagon
    Yeah if i have multiple options I'll always start with the highest price one. It works on a couple of levels including making the options appear cheaper in comparison and brings into play the reject and retreat principal. If i want to force the middle of three priced i will put the premium price first the option I want second and what i call the judas price third.

    The judas price is the cheapest option and is vastly inferior to the middle option in terms of added value. It is still a great value offering and over delivers on the clients brief but if only about 10% cheaper than the middle option. In turn the middle option tends to be about 35% cheaper than the premium offering.

    Using high first pricing and the judas price increases my roi and in a strange quirk increases loyalty in theclient base.

    Eric
    Signature
    I've got 99 problems but a niche ain't one
    {{ DiscussionBoard.errors[9534685].message }}
  • Profile picture of the author gjabiz
    Originally Posted by splitTest View Post

    Psychological pricing has been proven to affect perceptions of product value and affordability.

    The dif between a product price of $1,998 and $2000 may not be much, but it can make a difference in the minds of buyers, and even affect purchase decisions.

    You guys probably know ... Level, even prices (e.g. $2000) can make a product seem more prestigious. Prices ending in "99", "97" and "98" make a product seem more affordable and more of a value. Prices ending in very specific numbers (eg. $57.87) convey that you've thought hard about the price, calculating the product's true value carefully (and authoritatively).

    ...but what about when it comes to quoting prices for your copywriting services? Do you use psychological pricing at all?
    I'm not buying your premise. IF you can cite any scientific studies with a statistically significant sample which proves (or disproves) the 99, 97 and 98 "more affordable" which has been PROVEN to Effect perceptions, I'd like to see them.

    The only test I know of (publicly) which has been widely used was by a guy over 30 years ago.

    Having participated in many such private tests, the price ending has relatively NO effect on the buying decision.

    The BRIDGE has been proven. Offer the high end, quality, the low OK quality, and the medium if that is what you want to sell. There are studies that show comparison to higher price points does work.

    Likewise, although it is fairly trite online, establishing value and then a deep discount also works, although there is a new generation which doesn't buy the value pitch on a download, it is hard for even the best to convince people their FREE gift is worth 636.56 or whatever.

    Just one opinion here, to much thought on pricing PSYCHOLOGY, an element that can be tested once a baseline has been established, I'd prefer to see results and what is working.

    gjabiz
    {{ DiscussionBoard.errors[9534733].message }}
    • Profile picture of the author splitTest
      Originally Posted by gjabiz View Post

      I'm not buying your premise. IF you can cite any scientific studies with a statistically significant sample which proves (or disproves) the 99, 97 and 98 "more affordable" which has been PROVEN to Effect perceptions, I'd like to see them.

      The only test I know of (publicly) which has been widely used was by a guy over 30 years ago.

      Having participated in many such private tests, the price ending has relatively NO effect on the buying decision.
      ...
      Just one opinion here, to much thought on pricing PSYCHOLOGY, an element that can be tested once a baseline has been established, I'd prefer to see results and what is working.

      gjabiz
      Well, there's this study from the article Quadagon was nice enough to link to:

      "In his book Priceless, William Poundstone dissects 8 different studies on the use of charm prices, and found that, on average, they increased sales by 24% versus their nearby, 'rounded' price points.

      In fact, in an experiment tested by MIT and the University of Chicago, a standard women's clothing item was tested at the prices of $34, $39, and $44.

      To the researchers surprise, the item sold best at $39, even more than the cheaper $34 price."


      Then there's this paper from Marketing Bulletin, 1997, 8, 53-58, Research Note 1
      "The Widespread Use of Odd Pricing in the Retail Sector
      Judith Holdershaw, Philip Gendall and Ron Garland
      " (and others cited on Wikipedia).

      "A study designed to empirically test this assumption involved analysing the differences
      between expected purchase probabilities and actual purchase probabilities for six products (Holdershaw 1995). In total, ten odd price points were tested for an odd pricing effect in
      which estimated demand was noticeably greater at odd values. The test odd price points
      consisted of five 95 cent endings, three 99 cent endings, and two whole dollar odd prices; $95
      and $99. Sensitivity to pricing occurred with nine of the ten odd prices tested. Although the
      differences between expected purchase probabilities and actual purchase probabilities were
      not statistically significant, the noticeable pattern that occurred of greater than expected
      demand at these price points offers support for the odd pricing assumption.
      A more recent study (Wilton 1996) involved using choice modelling to estimate demand
      curves for three product categories and testing whether the predicted demand at price points
      which ended in 95 cents or 99 cents was significantly higher than expected. The findings of
      this study also provided strong support for the assumption that odd pricing generates greater
      than expected demand for some products. For each of the three product categories analysed
      by Wilton, demand was greater at both odd price points.
      Another recent odd pricing study involved testing sales response to three versions of a direct
      mail catalogue for women's clothing (Schindler & Kibarian 1996). The catalogues were
      identical except for the price endings which were evenly divided between 00, 99 and 88 cent
      price endings. The 99-ending version produced 8% more sales volume than the 00-ending
      catalogue. The 99-ending catalogue generated more purchasers than the 00-ending catalogue,
      and those purchasers spent larger amounts. The 88-ending catalogue produced a similar sales
      volume and number of purchasers to the 00-ending catalogue. Schindler & Kibarian
      concluded from this study that the right-most digits may have a substantial effect on
      consumer purchasing. "


      Then there are the Schindler and Kibarian (1996), Rutgers (2000), Schindler (1984), and Quigley (1992) studies cited in the book Cashvertising.

      Then there's the social proof, what with "99" and "95" pricing being so ubiquitous. ..Discount that if you will. I won't. .

      ...Still doesn't answer the question on the utility of psychological pricing (more specifically, "fractional" pricing) when it comes to services like copywriting. I'm leaning toward using it, only because just as colors can affect perception, fractional pricing likely can as well.

      Would you rather pay $399 or $400? $400, to me, just seems "weightier"... On the other hand a price of $399, coming from a copywriter (whose only product is ideas) seems somehow manipulative... That's the gist of my question. Thanks for all the opinions!
      {{ DiscussionBoard.errors[9538433].message }}
      • Profile picture of the author Chriswrighto
        Originally Posted by splitTest View Post

        Would you rather pay $399 or $400? $400, to me, just seems "weightier"... On the other hand a price of $399, coming from a copywriter (whose only product is ideas) seems somehow manipulative... That's the gist of my question. Thanks for all the opinions!
        A copywriter's product are the results he/she produces.

        I don't doubt that charging $2999 or $3000 makes a difference on the buyers mindset.

        But I also don't believe that it affects even 1% of their buying process at rates more than $300 or so.

        The only persuasion techniques I use to attract clients are...
        • Value Building
        • Future Pacing
        • Takeaway Selling
        • Urgency (ethically)

        (There may be more, but it's early.)

        I don't bother with altering my price by a dollar or three.

        Also...

        I learned a long time ago to stop jumping through hoops to get clients.
        I'd also agree with this.

        The more hoops YOU jump through, the worse relationship you'll have with your client.

        It doesn't make the project fun either.
        Signature

        Wealthcopywriter.com :)

        {{ DiscussionBoard.errors[9538928].message }}
        • Profile picture of the author splitTest
          Originally Posted by Chriswrighto View Post

          A copywriter's product are the results he/she produces.

          I don't doubt that charging $2999 or $3000 makes a difference on the buyers mindset.

          But I also don't believe that it affects even 1% of their buying process at rates more than $300 or so.
          Thanks for the insight, chris. Always interesting to hear you weigh in, since (as I understand it) you've done nothing but freelance copywriting for your entire career.

          ...But here's a question: if it affects that 1% ... if you believe there is indeed an effect on the buyer's mindset ... then why not do the fractional pricing? Do you sense there's a downside to applying it to copywriting fees?

          If you were pricing a client's physical product, or a book of yours, let's say, would you do the fractional pricing?
          {{ DiscussionBoard.errors[9538956].message }}
          • Profile picture of the author Chriswrighto
            Originally Posted by splitTest View Post

            Thanks for the insight, chris. Always interesting to hear you weigh in, since (as I understand it) you've done nothing but freelance copywriting for your entire career.

            ...But here's a question: if it affects that 1% ... if you believe there is indeed an effect on the buyer's mindset ... then why not do the fractional pricing? Do you sense there's a downside to applying it to copywriting fees?

            If you were pricing a client's physical product, or a book of yours, let's say, would you do the fractional pricing?
            Cheers split.

            Why not do it? Here's my reasons...

            1. My fees vary per project. I don't have a "set price". Could ending my quote on a '7' be effective at $1000-2000 range? But have a negative affect in the $2500-3500 range?

            2. I'm a copywriter and there's only a certain amount of work I can take on per month. It's not like I'm selling an Ebook where the benefits of fractional pricing could lead to thousands more dollars in my pocket.

            3. 80/20 maaaaan. There's no need for me to spend months testing and recording results to find a definitive answer to the benefit. I'd rather focus my time on writing for clients and personal projects.

            Would I do fractional pricing for a product? Yes. But I wouldn't know which converts best, straight off the bat.

            For all I know, it could vary per product.

            So I would test... test... and test.

            But this is very easy due to the numbers of people visiting the sales page.

            Chris
            Signature

            Wealthcopywriter.com :)

            {{ DiscussionBoard.errors[9539955].message }}
  • Profile picture of the author mellymags
    This is an issue I'm currently struggling with. Just starting out on my own so I don't want to get too bold with pricing, but I'm confident I've got the goods to back it up. Time (and testing) will tell.
    {{ DiscussionBoard.errors[9535675].message }}
    • Profile picture of the author Raydal
      Originally Posted by mellymags View Post

      This is an issue I'm currently struggling with. Just starting out on my own so I don't want to get too bold with pricing, but I'm confident I've got the goods to back it up. Time (and testing) will tell.
      Then you may find this great article by Michel Fortin helpful.

      -Ray Edwards
      Signature
      The most powerful and concentrated copywriting training online today bar none! Autoresponder Writing Email SECRETS
      {{ DiscussionBoard.errors[9535733].message }}
  • Profile picture of the author quadagon
    Heres a good read on pricing:

    https://blog.kissmetrics.com/5-psychological-studies/

    Theres links to further reading.
    Signature
    I've got 99 problems but a niche ain't one
    {{ DiscussionBoard.errors[9535864].message }}
  • ST,

    Originally Posted by splitTest View Post

    ...but what about when it comes to quoting prices for your copywriting services? Do you use psychological pricing at all?
    Nope. If you know what your services are worth, why would you need to use psychological pricing? Your pricing example and questions come across as though you are not sure what or how to charge for your services.

    I would just quote the job and be done with it. If they balk, they balk. Hang up and move on.

    It's really that easy!!!
    {{ DiscussionBoard.errors[9536062].message }}
    • Profile picture of the author splitTest
      Originally Posted by ThePromotionalGuy View Post

      I would just quote the job and be done with it. If they balk, they balk. Hang up and move on.

      It's really that easy!!!
      Well, thanks for the opinion TPG, but I can't buy that. I think you have to court the client in every way you can. We're not selling $2 boxes of cookies. A client "purchase" decision is generally based on an accumulation of factors: timing, price, your pitch, your look, your voice, your demeanor, testimonials, graphics, etc. etc. etc.

      As in copywritng, you leverage all factors you can for a cumulative effect in your favor.

      Not sure what market you cater to, but there aren't enough easy contacts in mine that I can make a pitch like that, shrug, and move on. I'm thinking that once they're at a point when they're inquiring about price, I want to use whatever factors I can to put them over the edge.

      If this doesn't ring true to you, however, I'd certainly like to hear your reasoning.
      {{ DiscussionBoard.errors[9538445].message }}
      • ST,

        Originally Posted by splitTest View Post

        If this doesn't ring true to you, however, I'd certainly like to hear your reasoning.
        I learned a long time ago to stop jumping through hoops to get clients and stop believing in "Expert Opinions".

        I'm not a brand name copywriter nor do I want to be. I've been writing copy since 1993 in 42 different industries. I fly below the radar on purpose and that is due to Dick Sanders influence.
        {{ DiscussionBoard.errors[9538594].message }}
        • Profile picture of the author splitTest
          Originally Posted by ThePromotionalGuy View Post

          ST,

          I learned a long time ago to stop jumping through hoops to get clients.
          Well, you must have a helluva sales pitch. Or one extremely hungry market.

          Originally Posted by ThePromotionalGuy View Post

          I'm not a brand name copywriter nor do I want to be. I've been writing copy since 1993 in 42 different industries. I fly below the radar on purpose and that is due to Dick Sanders influence.
          Well, thanks for the reply, but I have no clue what you mean by "fly below the radar" nor what Dick Sanders' philosophy is... Not being snide, but ...? Google ain't helping me re: dick, btw. Links?
          {{ DiscussionBoard.errors[9538914].message }}
          • ST,

            Originally Posted by splitTest View Post

            Well, you must have a helluva sales pitch. Or one extremely hungry market.
            No. I'm just contrary, go against the grain and don't do what the experts say works. I do what works for me and makes me a lot of money. My best asset comes from selling to the public for close to 46 years. Not just in copywriting but an accumulation of selling professions along the way.

            As the days turn into years and the years into decades of selling you can see the hungry markets in your own backyard. You don't need an expert or guru to point that out. I'll bet in your area there are hungry markets all around you that are waiting for you to tap into them.

            Originally Posted by splitTest View Post

            Well, thanks for the reply, but I have no clue what you mean by "fly below the radar" nor what Dick Sanders' philosophy is... Not being snide, but ...? Google ain't helping me re: dick, btw. Links?
            Flying below the radar is simply working at being skilled in a craft without drawing attention to yourself. Kind of like the auto repair shop that worked on your car. You don't know who actually did the work, you just know your car was repaired beyond your satisfaction and will only take your vehicle back there. Not to mention everyone you know you tell them about the auto repair shop.

            I don't know how I came to know Dick but our paths crossed at some point. I learned that Dick is the man credited for creating the first Magalog along with William Fridrich in 1986 for Dick Fabian.

            I thought that was interesting so I set out to locate him. I did some research and found that he is still copywriting. I contacted him to learn how he got into the business and he responded back. Him and I are pretty much alike.

            Here are some links you asked for about Dick Sanders:

            Interview With a Pro: Our Conversation With Master Copywriter Dick Sanders, Part 1
            Interview With a Pro: Our Conversation With Master Copywriter Dick Sanders, Part 2
            Insights from Working Copywriters

            Good Luck!
            {{ DiscussionBoard.errors[9539120].message }}
            • Profile picture of the author KreativCopy
              Originally Posted by ThePromotionalGuy View Post

              No. I'm just contrary, go against the grain and don't do what the experts say works. I do what works for me and makes me a lot of money.
              I think that is the key here...do what works for you! One of the best bits of advice I was ever given...over 20 years ago...was 'never run with the pack'. I took that and run with it!

              Okay...it has got me into some sticky situations...but from which I have learned so much.
              {{ DiscussionBoard.errors[9539877].message }}
  • Profile picture of the author CopyMonster
    One thought: how you price things says as much about your beliefs about you and your product as it does about the customers you attract.

    Personally, I feel for high-price custom services like copywriting, tiny pricing tweaks aren't a critical part of the conversation if you're targeting the right clients. Key word being "right".
    Signature
    Scary good...
    {{ DiscussionBoard.errors[9538523].message }}
  • Profile picture of the author splitTest
    Sorry to bump an old thread, but I stumbled across this article on freelancersunion.org. An interesting take...

    Freelance pros take the zeros out of project bids. Here's why.
    {{ DiscussionBoard.errors[9634882].message }}
  • Profile picture of the author WebOutGateway
    It's obvious we're all human and psychology in Pricing matters. That's is so usual. But good to know somebody made the thread.
    But if you go deeper to that sense, the premise now is..psychology will be affected when Quality is at stake. At first part, customer will be engaged to that promising prize, but what about that supposed to be 'engaging quality?'.

    Take a minute to stay on the quality first, then doing such things like that.
    Just a thought. Thanks
    {{ DiscussionBoard.errors[9635198].message }}
  • Profile picture of the author pewpewpewmonkeys
    Spending time using "psychology to create desire in someone > spending time playing with prices
    Signature
    Some cause-oriented hackers recently hacked one of my websites. So I researched what they're about and then donated a large sum of money to the entity they hate the most.

    The next time they hack one of my websites I'm going to donate DOUBLE.
    {{ DiscussionBoard.errors[9635233].message }}

Trending Topics