Price Anchoring How It Takes the Pain Out of High Prices
You find yourself in the market for a new car. You go to a nearby car lot and find a vehicle you would love to own, but the price is firmly outside of your range. Up walks an observant salesman, and after a bit of back and forth, he tells you he can beat 25% off that sticker price. It’s still more than you wanted to spend, but at 30% off, this deal is too good to pass up, right?
The salesman has just utilized a tactic known as “price anchoring.”
In this episode, we’ll be talking about:
What is anchoring
How does anchoring applies to pricing
How does anchoring applies to dates
A product is truly never “cheap” or “expensive”; it’s all relative. People love to compare when valuing products and having an anchor price allows them to do that. Price anchoring refers to the practice of establishing a price point which customers can refer to when making decisions.
Basically, in price anchoring, you make your customer think of a certain number, then you price your product or service below that number, thus creating the perception that he or she has saved money and got a decent bargain.
By implementing anchors in your pricing, you’ll be able to guide your customers to the product you want them to buy. It’s another powerful perception tool in your arsenal and a great way to generate revenue and improve your pricing strategy.
Mentioned in this episode: