What does it take for buyers to click ‘Buy now’? There have been various case studies behind this question and we have some pricing psychology tips that will help increase your sales.
As an entrepreneur, understanding how your buyers are led to make that all-important sales decision is key to bringing home the bacon online (or tofu, whatever works, no judgments here).
We all want people to buy our stuff—after all, it’s how we make a living—but the pieces of the pricing jigsaw can feel overwhelming.
The field of psychology in pricing is huge, but it’s only once you make a start and begin conducting your very own tests that any theories begin to take shape and make sense for your business.
1. Go round, charm them, and test the results.
Our brains process information very quickly and form immediate emotional decisions based on what we see. As entrepreneurs, we can make use of the way our synapses work by playing on the way our customers perceive the digits of our pricing.
In short, let’s give them the feel-good factor. Charm pricing is one way to achieve this: Drop a price by a digit to appear significantly less expensive to the brain.
For example, a $40 product compared to a $39.99 product seems higher in price but is, in fact, only one cent more.
Our neural pathways love a fluid connection to make us feel good, so keep the digits as challenge free as possible to smooth an emotional response. When something “just feels right”, a sale isn’t far away. Equally, we have a tendency to connect with a price that has a round number, meaning that we process a product at $60 more easily than a $58.64 pricing.
Try pricing your products using a round number and also a charm number. See what works with your audience and reuse the same formula with the rest of your products.
2. Anchor your products.
Want to make your product look like an amazing, no brainer value deal? It’s simple: Prime the brains of your customers by showing first the cost of a product that is higher than the one you intend to sell. This anchors the level of premium pricing in their minds, and by comparison, shows the product you are promoting to be a steal.
For example, you could show the price of a consultation session with you at $250, then show how a $9.99 ebook with your step-by-step process is a killer deal. Or, reference a program you took that helped with your knowledge that cost $1999, and now you can teach the skills in your audio series or ebook for $25.
The way this works is that by anchoring a higher number in the brain, consumers note a drop in price, encouraging them to click ‘Buy’.
You can also set up products to literally be cheaper if paid in full rather than month to month, like Chestnut School of Herbal Medicine did with their recent online course:
Entrepreneur and coach, Denise Duffield Thomas, sets the premium pricing to the left, which triggers the brain to see the right-hand price as being a steal in payment installments.
Another pricing example comes from Tara Gentile. She uses multiple price options, anchoring the middle one to encourage more sales of that product.
3. Hit them where it hurts.
Hitting pain points squarely on the head compels your potential customer to click the buy now button. Clearly convey in your product description and sales page which pain points they have that your product addresses.
Not sure where to start? Use the very language your customers do when talking about their problems.
Some great places to look for examples of this are:
- The review section of books related to your niche on Amazon
- In relevant groups or Facebook pages
- In the comments sections of relevant blogs and sites
Keep a swipe file of the exact words and phrases your potential clients are using, so when you pose the solution to them, it really resonates on an emotional level.
4. Don’t discount—add more value.
It can often be tempting to offer a discount, but in pricing psychology terms we can perceive a drop in price as a drop in value. Instead, consider adding extra resources, or additional elements as a bumper deal to hook in your buyers.
The price remains the same, but the perceived value increases. Entrepreneur and business coach, Leonie Dawson, bundled some of her most well-loved products into a bundle, providing immense value for her audience:
You could play with using a bonus bundle for limited time periods or as a specific promotion. Then, measure to see which trials perform the best. You’ll now have a formula to test, replicate, and improve on for steady sales and income.
5. Let them choose the value.
This is strategy is one to play with—and not for the faint of heart!
Offering a Pay What You Want (PWYW) option for your product—easily done with Selz—takes away the barriers to entry, and puts the power back in the hands of your customers.
Far from undervaluing your products, operating a PWYW strategy can actually increase revenue by removing the upper limits of contributions.
This is also a strikingly powerful hook for you, the seller, as the offer of PWYW positions you as a generous person to buy from—the perfect super fan creation scenario.
Example: PWYW deal option by Stack Social.
You may wish to play with options such as pay what you want day, or week, to incentivize the action.
- Try a rounded number and a charm number to test results.
- Anchor a high price, then show them your lower one to strike a deal.
- Get clear on the pain points and address them compellingly.
- Add more value, don’t discount.
- Try offering a Pay What You Want option.
What will you try next in your product pricing? Leave us a comment below!
Jo Gifford is a designer, blogger, and mentor who helps people work smarter and in more creative ways. She is also the creator of Killer Content Academy, helping small business owners create content for selling online. Connect with Jo on Instagram and get more smart advice on her blog, Dexterous Diva.