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Thread: Psychological Pricing

  1. #11
    Diamond Member Blurock's Avatar
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    Quote Originally Posted by adrianh View Post
    This is very true. I used to sell a lot on Bid or Buy. When a product is put onto BoB as a "Buy Now" (meaning you can get it whenever you want) people simply don't buy the product. Yet, if you put the same product on as an "Auction" with a very short time frame then it sells. Also, products put on with shorter Auction cut-offs are more likely to sell than items put on with long run times - I think it might be because when the customer sees the item as short-cut off they react immediately rhather than think they can go back later (and probably forget to do so)

    As an aside: The stuff placed on the counter right at the till is known as "Koop en loop" in the industry..... those ultra expensive, mostly rubbish products that you grab and add to your purchase without thinking. My daughters and I found that some products cost twice as much as the equivalent product placed on a normal shelf. The "forced 20m sweetie isle" that we are herded through like cattle is a long drawn out "Koop en loop" trap!
    Impulsive buying is encouraged by retailers. The display and placing of products is an art on its own and merchandisers fight to get the best position or eye level shelves. That is why the highest turnover items are always placed at the back of the store and the slow movers in front.
    Excellence is not a skill; its an attitude...

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    Quote Originally Posted by Blurock View Post
    Impulsive buying is encouraged by retailers. The display and placing of products is an art on its own and merchandisers fight to get the best position or eye level shelves. That is why the highest turnover items are always placed at the back of the store and the slow movers in front.
    That is very true - the cooldrink is always right at the very back of the shop forcing customers to walk all the way the way through to the back. I find that many shops don't show where the cool drinks are so you end up searching. Some shops dot different brands of cooldrinks on the rear facing gondola ends at odd places in the shop - Monster is at the one end, Dragon in the middle and Coke right at the back corner.

    They also dot the gondola ends with ultra expensive complementary products - like the biltong right by the wine. I suppose if you are spending a couple of hundred on wine then another hundred on biltong goes without thinking.

    Another trap that I fall into is this: My daughters and I stand in the row at the tills. I get bored very quickly so I ask them to wait while I walk around - I always end up buying food close by out of boredom. The odd can of cooldrink or packet of chips. I suppose one should go shopping with proper blinkers and earmuffs like horses are made to wear against distraction. :-) I must add that both my daughters fall into this trap too.

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    Platinum Member Derlyn's Avatar
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    Go grocery shopping just after you've had a huge breakfast or lunch.

    You then won't be interested in grabbing that extra packet of chips or cooldrink.

    NEVER, NEVER go grocery shopping when you are hungry.

    Peace out .. Derek

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    Quote Originally Posted by Derlyn View Post
    Go grocery shopping just after you've had a huge breakfast or lunch.

    You then won't be interested in grabbing that extra packet of chips or cooldrink.

    NEVER, NEVER go grocery shopping when you are hungry.

    Peace out .. Derek
    Yeah....we always make this mistake. Its amazing the rubbish you buy when you're hungry.

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    Diamond Member Blurock's Avatar
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    4. Price Appearance
    The design of your prices can have a tremendous impact on how customers perceive the value of your product.
    Fancy restaurants will most likely have prices in a smaller font and won’t have the added zeroes at the end. They’ll look like “190”, instead of “R189.99”.
    The reason for this type of design is that longer prices appear to be more expensive than shorter prices, even if they represent the same number.
    This is because subconsciously, the longer prices take more time to read. They also leave out the “R” sign for prices as it makes the price longer.
    They may even leave out the price altogether. If you can afford a Ferrari, you don't ask for the price first.

    Another tactic is to use a very small font for the 99c. A customer's perception of your pricing has a huge impact of how the business is perceived. You can change the perception of your pricing by adding an odd number, anchor prices, and a handful of other tactics such as fancy packaging. Most importantly you must convey the value of your product. Worst thing that one can do is to leave customers feeling tricked after their purchase; they may never come back and also post their displeasure on social media.

    Some may see these techniques as taking advantage of consumers’ inherent mathematical and psychological weaknesses, while others may find them to be an essential part of everyday business. Look for these tactics being used on you as you go shopping. Don't be fooled!
    Excellence is not a skill; its an attitude...

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    I think milk and bread go at the back because most people have to get it anyway so why not have you walk the store and see other products...twice.
    Sure everybody knows this one, most stores keep their temperatures at about 21 - 23C
    - People tend to buy more when they feel more comfortable.
    - Also if it's cold or scorching outside you will stay there a little longer.
    - This has a double impact you are more likely to buy and a store full of people actually sells more than an empty one.
    This plays again upon the sense of urgency to get something because it might run out, also makes you believe there a good deal here.
    Ever wonder why the queuing issue is never solved? Seeing a queue get bigger makes you impulse buy to get back quickly so you spend less time calculating what is the better price and just get what seems like the better price which in most cases isn't or what's closest.
    - Also again seeing a big queue makes most people think there are deals here, I mustn't miss out.
    Rounded numbers 499 instead of 493 perform better.
    Retailers control the pricing of brands that sell in their shop for the most part. It makes it easy for them to create an In-house brand that can compete and seem like the better DEAL while still making a profit.
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    Quote Originally Posted by New Perspective studio View Post
    Retailers control the pricing of brands that sell in their shop for the most part. It makes it easy for them to create an In-house brand that can compete and seem like the better DEAL while still making a profit.
    Not only do they create in-house brands they also have large companies create models just for them. Companies like HiFi Corp and Incredible connection often sell branded computers with slightly different model numbers / EAN13 codes so that you can't compare prices directly.

    Our local hardware shop chain often advertises Bosch machines on special that, on closer inspection, have slightly different models numbers with vastly inferior specifications. These products are sold at slightly lower prices than their proper counterparts making it seem as if you are buying the proper tool at a discount. Things like 1500W vs 1S00W (which in the fine print is a 1200W machine)

    Another thing that gets my goat is computer companies that show desktop computers with screen, keyboard, mouse etc and even put those things in the specs. Then there is a tiny little disclaimer in an obscure corner saying that the screen, keyboard and mouse and operating system are not included in the price.

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    I saw this at Pick and ROB-YOU today

    Click image for larger version. 

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