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Do you want to make your prices more competitive? If your answer is ‘yes’, you’ve come to the right place. Here, we will share some tips for attracting more buyers for your products with the prices you set. These are ‘psychological pricing’ techniques that have proven to be effective for the businesses that employ them. The good news is, you don’t have to slash your existing prices by much to make these methods work.
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Before we jump in, let’s explain what psychological pricing is.

What is Psychological Pricing?

Psychological pricing is setting prices (or disclosing them) in a way that triggers a customer’s positive emotional response to those prices. The aim here is to make people more open to buying than they would if you had simply stated the new prices.

Psychological Pricing Techniques You Can Use

Charm Pricing (One Naira Less)

You’ve probably seen some stores do this.  It involves chipping a naira off your price. For instance, if your product price is ₦500, you can set it at ₦499. Customers are more likely to go with the second price than the first, even if it’s just lower by ₦1. That’s because it’s (i) priced lower, and (ii) ends with an odd number. The buying response is usually greater than what you would expect of a single naira.

Buy One Get One (BOGO)

Maybe you have seen this as well. Businesses put up a promo, in which they offer an extra product if you purchase a specific number of products. The real tactic here is that the price isn’t mentioned. This keeps the potential buyer’s attention on the benefit, and away from the fact that they’re parting with cash. The offer of the extra product often proves attractive enough to raise sales. That’s why it continues to be used. Just be sure you have noted the correct combination of priced and free products that will draw in customers without hurting your bottom line.
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Comparative Pricing

Here, you display two prices: first, the initial or standard price; and then the new, discounted price. The first appears in dimmer fonts and/or crossed out. The latter is in bolder (and/or larger) font. This makes the customer more aware that they are getting a bargain. With it, they are more likely to buy than if you simply told them the price you’re selling your products for.

Limited Time Offers

In this case, time limits are set for discounts. For example, you offer a lower price and notify the potential buyer that the discounted stock is only available for three days. This creates a sense of urgency on the part of the customer. If they don’t get the product within the window you’ve provided, they will miss out on the opportunity to save on a purchase. The feeling of urgency increases the chance that they will buy the product. Final Words These approaches to selling have worked for businesses in industries: FMCG, fashion, real estate, IT services, entertainment, and a host of others. They are likely to work for yours too. Just go for the ones that fit well enough with your unique operating conditions.   Featured Image Source: For Smart Hotels
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This article was first published on 20th August 2020

ikenna-nwachukwu

Ikenna Nwachukwu holds a bachelor's degree in Economics from the University of Nigeria, Nsukka. He loves to look at the world through multiple lenses- economic, political, religious and philosophical- and to write about what he observes in a witty, yet reflective style.

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