In this weeks video, Astrid Groenewegen explains 3 ways you are being persuaded to buy a product or service. It is all about how you present the prices of your products. With the knowledge of these Behavioural Design tactics you can apply them in practice immediately to boost your own sales.
Price estimation by anchors
Do you want to convince someone to buy your products or services? Then knowledge of Behavioural Science is exactly what you need. The first step to get started with this is to look at your prices. No, not how much you products actually cost, but how you present them to your customers.
Did you know that we as humans are quite price clueless. We often have no idea what something should cost or what something is worth. The way our brain forms an opinion about pricing is taking cues from the environment in which the product or service is presented. A signal that gives you a reference point to base your estimation of the price of the product on is called an anchor.
“A reference point that we use to base our opinion on to buy something”
On a daily basis you are being influenced by anchors. This occurs unconsciously, so you don’t even notice it is happening to you to! This is why it is such a great tactic to use when we want to influence customers behaviour to buy our product.
Three ways you are persuaded to buy a product.
I want to show you three ways you are being influenced by an anchor that makes you buy something.
1. The decoy effect: When there are two items for sale, the decoy item is priced in a way to make the other item (the one the manufacturer really wants to sell) seem more attractive.
Let’s say you are shopping for a coffee machine. If you are presented with two options, of which one is significantly more expensive then the other, you are probably dealing with a decoy. This tactic makes it more easy for you to choose because you probably want to cheaper version (if the quality is the same). You can use this principle to make your products more attractive. Just add another product for a much higher price to your shop so people are more attracted to your original, and now cheaper, product.
2. Presented with 3 options: People tend to choose the option in the middle.
What you need to know is that when people are presented with more than two options another phenomenon occurs. The center-stage effect: when we make decisions we tend to gravitate to the middle. You often see this in pricing plans. You are offered three options: small – medium – large. A small package might seem too little but a large package might seem too much. So our unconscious decision making brain will pick the middle option. It is important to know that you might have made a different assessment of the packages when there were only two options. You can use this to by presenting your products or services in three options. Make sure you present the most desired option for you as the middle option.
3. Shown the old price: The original high price is crossed out and replaced with the lower new price.
This final tactic you see a lot. Our unconscious brain uses the original price as an anchor. The new price will be compared to this anchor and will be perceived as a bargain. This happens automatically. We don’t stop and wonder if the new price actually is a bargain for that specific product.
So here is a tip: when you buy a product of service, be aware of anchors that increase the attractiveness of a product or service.
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