Aug 12, 2021
Psychological Pricing Strategy: 7 Examples (& What to Do Instead)
Oh hi. I just abolished all the -997 pricing from my website, and here’s why…
This pricing—called “charm pricing” or “psychological pricing”—is used to affect the way a potential buyer *perceives* the cost of your product or service.
In online marketing, especially in the coaching & service provider spaces, you’ll often see prices like $97, $297, $2997, etc. This is because of two things—
1. Long ago, in a galaxy far, far, away, a dude bro figured out that odd numbers converted better than even ones, 7’s best of all. I can’t say for sure, but I’m gonna guess nobody bothered to ask whether or not this was an ethical or fair thing to do.
2. The “left digit” effect. Watch this—
Delicious funky bottle of wine costs…
$29.99 vs. $30.00
Same bottle of funky red costs…
$31.59 vs. $32.00
Which one seems like the bigger difference? 🤔
We KNOW that $29.99 is basically $30, but your mind is like, “it’s only twenty something!”
This is just a thing our brains do, you know, for brain reasons.
Have you ever truly explored *why* you’re pricing your offerings at $497 instead of $500? And whether or not it’s ETHICAL to do so?
In my experience, those questions usually get waved away with a response like, “we’re ‘helping’ the customer make the purchase by reducing the ‘friction’’.”
But consider this…
Why are we undermining a person’s ability to make a fully informed purchasing decision here?
If we know that a $497 price tag is more appealing to someone *precisely because* their brain perceives it as somehow “not $500”—when we all know it really costs $500—aren’t we just deceiving them?
If someone sees a $500 price tag and decides of their own free will, of sound mind & body, that it’s not an investment that makes sense for them, that’s not “reducing friction;” it’s overriding their instincts and making it harder for them to do what’s truly right for them.
Changing the price to $500 might create an initial drop in your conversions. But I’d bet it’ll bounce back.
About Sam
Samantha Pollack is a Copywriter & Creative Director who works with ethically minded, mission driven businesses who are actively trying to reshape our culture (and possibly tear down the patriarchy). She’s also the founder of The Highly Sensitive Business Owner, a 12-week online program that helps HSPs & neurodivergent business owners create healthier, more sustainable systems in their work.
Sam also writes about feminism, privilege, pop culture, entrepreneurship, the creative process, and whatever else is on her mind. She currently lives in Asheville, NC.
Emails for cult thought leaders.
(Personality included.)
Want to learn how to craft emails that inspire action and engagement WITHOUT the “tried and true” (cough: patriarchal) norms we’ve all been taught?
I’m doing it, and I can show you how to do it, too.
(But sometimes, I also like to write about the books I’m reading, or the creative process, or the entrepreneurial experience, or why I hate Steve Jobs, or how I met my BFF. I’ll send you emails like that, too.)
*Just kidding. It’s only an email list.
Books. Cats. Rants. Drawrings.
(and every couple months or so, an unexplained absence 🤷🏻)
