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Psychological Pricing

What is Psychological Pricing?

Psychological pricing is a pricing strategy that involves setting prices at specific levels in order to influence the perception of value and attractiveness of a product or service. It is based on the idea that certain price points or price endings can have a psychological impact on consumers and can influence their decision to purchase a product or service.

Psychological pricing techniques can be used in a variety of settings, including retail, online, and services. Some common examples of psychological pricing techniques include:

  1. Odd pricing: Setting prices at odd levels, such as $19.99 instead of $20, in order to make the product or service appear to be a better value.
  2. Charm pricing: Setting prices at certain levels, such as $9.95 or $9.97, in order to make the product or service appear to be more attractive or affordable.
  3. Anchoring: Setting a high initial price and then offering discounts or promotions in order to make the final price seem more attractive.
  4. Decoy pricing: Offering multiple pricing options, with one option being significantly more expensive than the others, in order to make the other options seem more attractive.

Overall, psychological pricing is a pricing strategy that involves setting prices at specific levels in order to influence the perception of value and attractiveness of a product or service. It is based on the idea that certain price points or price endings can have a psychological impact on consumers and can influence their decision to purchase a product or service.


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