Persuasive Pricing Using Psychology
Being an entrepreneur in this space and trying to decide how to price your offers can feel overwhelming. I want to take away the overwhelm with the process and break it down to help you create a pricing model that you're confident with and is magnetic to your soul mate clients.
There was some research done and shared in the book called How Customers Think by Harvard Professor Gerald Zaltman.
In the book, he estimated that about 95% of purchasing decisions are made from the subconscious mind. There we must stop trying to rationalize our way into pricing. when we do this, we can in turn relate to customers on a deeper level. Therefore, I want to discuss pricing so that you can feel equipped into identifying how to effectively price your offers. Ultimately when we tap into those subconscious behaviors, patterns, biases, and experiences that our clients are holding on to, we can deliver an effective way for us to be able to call in the soulmate clients and to be able to retain the ones that we already have.
There are four different options when it comes to pricing structures. There's prestige pricing, there's charm pricing, there's comparative pricing, and there's spiritual pricing. Now, there are a lot of other options. If you were to Google, like the psychology behind pricing, there's a ton of other ideas and options and ways that you can go about pricing. But these are the ones that I've kind of narrowed down based on what I see used most in this space and the ones I have personally utilized as well.
First there is prestige pricing, there is this idea of like this luxe or highly valued customer experience, hence the word prestige. This is where the pricing model is set at a high level. Recognizing that lower-level pricing kind of creates this idea that maybe it's of great value that this is going to be high quality and exclusive. So, it gives people that drive or that passion or that desire to rush in to grab their spot, to join because it makes it just seem exclusive. And it makes it seem exclusive.
Next, we have charm pricing. With charm pricing, there is this idea that when you end in like a 99 or you end in like a seven, or you end in like a five, you reduce that last digit by a number or two. This resonates with our brain is almost like 2.99 is different than $3.
A lot of people may say that it's $2 versus $3. So, because it registers in our brain as a different value, you feel almost like you're getting a deal. So, therefore you'll see like books priced at 995. Or therefore you'll see coaching programs priced at 997 instead of $1,000, because there seems to be a massive difference between 997 and $1,000. This then creates this feeling in our brain that we're saving money. The human mind subconsciously registers that as reasonable when you sell something for 597, but 600 may just feel a little bit more unreasonable. This works super well with payment plan options, and it works super well with tripwire offers or low ticket offers as well, because you get them into your funnel at a low ticket offer or you catch them at a trip wire. And that works well. So, you'll notice a lot of my tripwires are $37 or $47, my payment plan options.
There are two different ways that you can do comparative pricing. Comparative pricing could be that you look at people that are in your market doing the same thing, and you're comparing your price to what it is that they are pricing at to ensure you stay in the ballpark. Comparative pricing can also look like you creating different pricing tiers. So, a lot of times the way that I use comparative pricing is I'll talk about what the program is valued at, and then I'll talk about what you're getting it for. So, I'm shocking them with the value price and then showing them the no brainer offer they can get by joining us. The trouble with comparative pricing is that sometimes people can begin to question, why are you discounting it? If you are discounting it for any reason, you're going to want to really highlight that reason because you don't want people to think that they're getting less value. So that's a big thing to really consider if you're doing comparative pricing.
Finally, we have spiritual pricing, which is really my favorite. Spiritual pricing is where you lean into, the feeling of what that price equates to as far as the meaning behind it. So spiritual pricing, with any psychological pricing in general, it's the practice of creating more value for your potential clients. You want them to look at what it is that you have to offer and perceive the value that they're going to get by saying yes to this next step.
You want to be able to accurately gauge how much your consumers are emotionally responding to your prices, and this is especially important with spiritual pricing. So, with spiritual pricing, you use different angel numbers. These are repeating numbers. For example, you might use something like 444 or 11:11. these different spiritual pricing or these angel numbers creates this connection with those who are spiritual, and it creates the positive meaning. So, a lot of the spiritual pricing is all about alignment too. You can Google to see different meanings of spiritual numbers. For example, 444 means being surrounded by Angels and you being highly focused on what you're moving towards, and you being guided towards that.
Seven has a spiritual meaning of completion. So, you really completing this chapter and bringing it all together. Eight is also spiritually known as the new beginnings. There's also some research that 8 means lots of money and financial abundance.
You can see that there's four different pricing options. For me, I've kind of toyed and played with all of them. You will want to find a model that feels aligned for you. Again, there are no right or wrong ways to approach this. While I have done some competitive research, I do often vary between charm pricing and spiritual pricing. Sometimes it's a blend. I have one program suite that has a tripwire for $37, which is charm pricing, but then I upsell into spiritual pricing, which is $444. So, I've done a blend and there's no right or wrong answer. I want you to just be informed so that you feel like you can make an informed decision about pricing.
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