Secret behind Pricing Online?

[howard_two]

What's the secret behind using the number 7 in setting prices up? It's something I see in all programs sold online, and not only ebooks. Programs, memberships on the famous one-page websites all talk about paying a figure that ends with a 7. So it's either $97, or 197, or 397, or 17? What's the deal here?????

Thanks in advance. :thankyousign:

 

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[howard_two]

Hopefully someone knows?

 

[mtnman]

this may help

 

[psynapse]

Two factors are at play here ..

1. Psychological Pricing: A marketing practice to boost sales by expressing prices as a less-than whole number so that the customer thinks it is significantly cheaper. More info available at http://en.wikipedia.org/wiki/Psychological_pricing

But you're probably already familiar with psychological pricing, and the main point of your post is why the number '7'. Leads to point #2..

2. Confirmation Bias: While you think you all programs sold online end in 7, this is actually not the case. There are many, many price points that don't end in 7, although many do for the reason stated above. The reason it seems that it seems prevalent everywhere is due to the phenomenon of confirmation bias: http://en.wikipedia.org/wiki/Confirmation_bias

HTH!

::

 

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[howard_two]

this may help

As always GENIUS:eusa_clap::eusa_clap:

What if I'm lazy

 

[howard_two]

...But you're probably already familiar with psychological pricing, and the main point of your post is why the number '7'. Leads to point #2..

2. Confirmation Bias: While you think you all programs sold online end in 7, this is actually not the case. There are many, many price points that don't end in 7, although many do for the reason stated above. The reason it seems that it seems prevalent everywhere is due to the phenomenon of confirmation bias: http://en.wikipedia.org/wiki/Confirmation_bias

HTH!

::

Good info sysnapse, I need to do some reading. However the number 7 in the end's really predominant...very predominant.

 

[howard_two]

Nerdsmasher, I posted your excellent response here. Hope you can find that ebook.

​

 

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[Diane Kennedy]

This is the secret gossip stuff - we used to always say you wanted to use 7 +/- 2 in titles and headlines. The Five Steps to.... The Nine Secrets of.... You can also use 12 - 12 steps, 12 apostles, lots of 12 references.

And so pricing was typically set to end at 9.

This is the kind of thing we did 15 years ago. Then everybody's attention span got shorter and it became 5 +/2. Pricing went to 7 (7 is the new 9)

I have no idea is this true - it's just the urban legend among people who have been doing this for awhile.

(If you notice my headlines I'm usually at The 3 Secrets to... or The Five Leverage .... etc etc )

 

[howard_two]

This is the secret gossip stuff - we used to always say you wanted to use 7 +/- 2 in titles and headlines. The Five Steps to.... The Nine Secrets of.... You can also use 12 - 12 steps, 12 apostles, lots of 12 references.

And so pricing was typically set to end at 9.

This is the kind of thing we did 15 years ago. Then everybody's attention span got shorter and it became 5 +/2. Pricing went to 7 (7 is the new 9)

I have no idea is this true - it's just the urban legend among people who have been doing this for awhile.

(If you notice my headlines I'm usually at The 3 Secrets to... or The Five Leverage .... etc etc )

Thank you Diane...

 

[howard_two]

Two factors are at play here ..

1. Psychological Pricing: A marketing practice to boost sales by expressing prices as a less-than whole number so that the customer thinks it is significantly cheaper. More info available at http://en.wikipedia.org/wiki/Psychological_pricing

But you're probably already familiar with psychological pricing, and the main point of your post is why the number '7'. Leads to point #2..

2. Confirmation Bias: While you think you all programs sold online end in 7, this is actually not the case. There are many, many price points that don't end in 7, although many do for the reason stated above. The reason it seems that it seems prevalent everywhere is due to the phenomenon of confirmation bias: http://en.wikipedia.org/wiki/Confirmation_bias

HTH!

::

psynapse...good points and great read. Thanks for the articles, however I respectfully disagree. The number 7 in pricing is much prevalent...Just see how many 7s are in the prices of the list below...

Here is the list from: http://the-gurus-suck.blogspot.com/2007/09/get-guru-products-10000s-of-ebooks.html

Affiliate Rockstar Status
Price: $77

Project Black Mask
Price: $97

Untold Marketing Secrets

Adsense Confessions
Price: $69.97

Affiliate Commandment
Price: $9.97

Affiliate Cash Vault
Price: $49.95

Affiliate Thief
Price: $77

Beating Adwords
Price: $67

Google Money Pro
Price: $97.98

Adwords 180
Price: $97

Adwords Miracle
Price: $97

Day Job Killer
Price: $97

Google Cash 2005
Price: $67

Affiliate Project X
Price: $97

Definitive Guide To Adwords
Price: $49

Duvet Dollars
Price: $77

Guru Slayer
Price: $97

Butterfly Marketing Manuscript
Price: $97

Ultimate Wealth Package
Price: $49.95

Autopilot Profits
Price: $27

Blogging To The Bank
Price: $97

Get Google Ads For Free
Price: $67

Traffic Manuscript
Price: $97

Adwords Confessions
Price: $47

Adwords Blackbook
Price: $197

Average Joe Income Package
Price: $57


Seo Book
Price: $79

Blogging Cash Machine
Price: $49

Internet Marketing Course - Corey Rudl

Ultimate Sales Letter Copywriting Course - Dan Kennedy

Newbie Cash Machine

Worn Paper System
Price: $27

Rich Jerk Real Estate
Price: $19.95

Membership Riches

How To Turn Flipping Websites into 40k month

Google Wealth Wizard
Price: $77

Adwords Mad Scientest

Honest Riches
Price: $37

Profit Monster
Price: $49.95

Squidoo Marketing
Price: $47

Social Bookmarketing made Easy

Social Bookmarking Secrets

33 Days To Online Profits
Price:$37

Desperate Buyers Only
Price: $77

Satellite TV For PC
Price: $49.95

Niche Marketing On Crack
Price: $47

Adsense Whizz Kid
Price: $77

Web 2.0 Traffic System
Price: $47

Forex Enterprise
Price: $49.95

Google Adsense Secrets
Price: $97

Forex Trading Machine
Price: $97

Adsense Arbitrage Voodoo
Price: $97

Tag And Ping
Price: $147

Become Hated
Price: $67

High Performance Affiliate Marketing
Price: $49.95

The Amazonian King
Price: $97

Kontera Content Links Secrets
Price: $47

Chitika eMini Malls Secrets
Price: $47

How To Build Profitable Websites Fast
Price: $47

Free Traffic With MySpace
Price: $67

The Google Wealth System
Price: $37

Top Secret Automatic Money
Price: $87

I Create Reality
Price: $28.19

Who Loves Money
Price: $97

Super Affiliate Handbook
Price: $47

Underground Hypnosis
Price: $136.37

Beyond Manifestation
Price: $67

The Day Trader's Bible
Price: $19

Instant Money Vault
Price: $39.95

The Best Deal Ever
Price: $47

Create and flip
Price: $27

Quick And Easy Info Product Creation Guide
Price: $47

Data Entry Bank
Price: $49.95

Affiliate Cash Blueprint
Price: $19.95

Craigslist Profits
Price: $29

Adwords Voucher Exposed
Price: $47

Overnight Forum Cash
Price: $67

5 Bucks A Day
Price: $47
Desperate For Money
Price: $39.99

Social Networking On Squidoo
Price: $47

Internet Million Dollars
Price: $49.90

The Legacy System
Price: $199.99

12 Month Millionaire
Price: $297

Turbo Membership
Price: $67 Per Month.

The Scholarship and Grant Guide
Price: $47

iPod Blender
Price: $37
Software:

Article Post Robot
Price: $127

Glyphuis Software
Price: $135

Hot Item Finder
Price: $37

SEO Elite
Price: $167

RSSGM Auto Installer
Price: $47

Clickbank Elite
Price: $67

Niche Inspector
Price: $97


Profitsponder
Price: $177

Webscraper+
Price: $419

RSS To Blog
Price: $247

The Dowser Pro
Price: $97

Backlink Submitter
Price: $67

The Design Dashboard
Price: $59.95

Phantom Cloaker
Price: $159.95

PLR Commander
Price: $49.95

Adword Generator
Price: $97

Competition Dominator
Price: $167

Craygo
Price: $45

Easy Blogger Creator
Price: $147

Power Link Generator
Price: $97

Cover Action Pro
Price: $97

Amazon Hunter Pro
Price: $49.95

Landing Page System
Price: $197

Article Morph
Price: $67

Xtreme Conversions
Price: $147

Forum Fortunes
Price: $19.99

PLR Article Pro
Price: $29.97

Unique Content PRO
Price: $47

Click Ad Equalizer
Price: $97

MySpace Friend Blaster Pro
Price: $59.95
Install Instructions:

Counter Code Enterprise
Price: $49

Nixie Affiliate System
Price: $29.41

Swapclix
Price: $49.95

GooHay
Price: $99.96

SEO Studio Enterprise Edition
Price: $329.99

Idevspot.com TextAds
Price: $19.41

Million Pixel Script
Price: $179

Affiliate Network Pro
Price: $390

The Blog Solution
Price: $207

The Google Back Door
Price: $198

Free Search Engine Traffic
Price: $47

Traffic Imperium
Price: $97

Beyond Adsense 2007
Price: $67

Affiliate of the month
Price: $37

Graphics/Templates:


Instant Header Graphics
Price: $197

 

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[howard_two]

hell even the guy posting this list is selling his ebook for 27 dollars

Learn how you can have all of these for just $5000! WRONG!


Only $27

Thats right, just $27!

 

[Russ H]

Howard-

A quick observation:

All of the items you list are internet based resources.

If you go to amazon, books are priced at strict mark ups from cost, so they end in all digits.

And I did a quick check of hotels: Most all prices end in 9, some (surprisingly) in 4s. Discounts off of those prices varied, some ending in 8s, or other weird numbers "235.81", etc.).

Or how about electronics: http://www.tigerdirect.com/, http://www.jr.com/ , Best Buy, Circuit CIty, etc: Lotsa, lotsa 9s.

For pricing an e-book (the initial discussion), it appears that "7" is the new "9", as Diane says.

In other areas-- especially hyper-competitive cost-plus pricing (like amazon), or in lodging, 7s don't seem to have any significant penetration.

-Russ H.

 

[RealOG]

Hey Ya'll,

I love pricing. I am actually a "pricing guy" at my current company. That "7" gimmick is designed specifically for consumer mentality. The post about pyschological pricing is very true. There are tons of psychological pricing tactics, like three tiered pricing.

An example: Wendy's had the single and the double hamburgers. In an effort to drive more revenue, they decided to come out with the triple. What do you think happened next? They sold more doubles! People have a psychological draw to stay out of extremes. They never want the "best" because its considered unnecessary. They never want the "worst" because its considered not good enough. Depending on your situation, offering a three tiered pricing strategy can drive more customers to the middle.

Another thing done, very successfully, at grocery stores is the "twofer". You will be walking down the cereal isle and see a deal on Cheerios, "Two for $3!" What do most people do? Grab two boxes, sometimes without thinking. Even though the price for one is $1.50, the psychology of the pricing makes them think they get a better deal on two rather than one and they buy more than they needed.

Pricing for B2B is much different, though I am constantly surprised by how much this silly game still works there too.

RealOG

 

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[NerdSmasher]

Rep+++ RealOG, that's some useful information!

And, I'm sorry to say that I cannot find that ebook... as I believe it was on my other computer which recently died. I'm going to keep looking around online and see if I can't re-find it at it's site or something, but it may just have to remain a mystery forever!

 

[howard_two]

Thanks guys...This turns out to be an interesting topic.

 

[Russ H]

Wendy's had the single and the double hamburgers. In an effort to drive more revenue, they decided to come out with the triple. What do you think happened next? They sold more doubles! People have a psychological draw to stay out of extremes. They never want the "best" because its considered unnecessary. They never want the "worst" because its considered not good enough. Depending on your situation, offering a three tiered pricing strategy can drive more customers to the middle.

Thanks for this, OG.

Gives me something to think about as we develop our next B&B.

Much appreciated. Rep speed. +++

-Russ H.

 

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[howard_two]

Here is an ebook I found about this issue. I don't know if that's what NerdSmasher was referring to, but this one looks promising. And guess what, it's 47 dollars

It's also sold on the MarketingSherpa:

http://www.sherpastore.com/46-ways-to-raise-prices.html

 

[psynapse]

Howard_Two, I certainly agree with the prevalency in the list you provided. However, may I suggest comparing a larger sample size, such as http://www.ebooks.com/ (Or Russ H's links), and you will find the numerous 7's to be significantly less prevalent. In fact, providing that list is an example of the confirmation bias phenomenon

RealOG, very true with the 'three-tiered' mentality. That is definitely commonly-practiced. As an added note, a business can drive the middle choice even further with a "1,3,7"-type pricing structure. If the 3 choices are in a "1,2,3" structure, the consumer may see enough value in going for the best since the jump isn't that much. This is often the case with a "bronze, silver, gold" package. So the gaps between the 3 choices also play a factor..

:3some: