That can be used to influence
buyer behavior and sales:
Offering specially reduced prices can drive sales very
effectively. You can offer a clearance discount to move
products, encourage multiple purchases of similar items with
discounts, or offer discounts for bulk orders.
If you offer too many discounts your customers may come to
see your full-rate pricing as expensive. Constant discounting
can also backfire by decreasing your products' value in the
eyes of your customers.
Pricing Tactic #1
The freemium model is especially common for digital
products like software, content, apps, games, web services
or memberships. It offers a free version of the digital
product and also a premium version that has more features.
You can also offer a free digital product that then advertises
other premium products. Customers can get a taste of the
value the product offers firsthand with the free version,
leading them to purchase the premium version.
Pricing Tactic #2
Bundling involves selling a package of goods or services
together at a lower price than they'd be if bought
individually. Bundling is what's happening when you buy a
set menu item at a fast food restaurant.
It's also used by car dealers who sell special options or
mobile phone calling plans. Bundling is a type of discount
that doesn't negatively affect your customers' perception of
your products' value.
Pricing Tactic #3
A company positions its products as higher quality or higher
value than those of competitors, and charges a higher price
accordingly. To bring in new customers and introduce them to
this superior value, they offer occasional promotions,
advertisements or coupons that sell the product for a lower
price for a limited time. Customers buy the lower-priced
product, realize its superiority over similar products by
competitors and become loyal buyers of the company's higher
Pricing Tactic #4
The decoy method offers a handful of similar products at
different price points. One or two of the products are
"decoys." They are priced high and the company doesn't
expect to sell them in high volumes. Rather, their high price
offsets the lower price of the target product.
It appears cheaper than it really is to the customer when
compared to the higher priced items. This allows companies
to sell their products at a "lower price" without actually
lowering the price.
Pricing Tactic #5
This is a classic pricing strategy where companies choose an
odd price such as $19.99 rather than $20 because it looks like
a lower price.
While it seems obvious that one cent is an insignificant
difference, companies have used odd value pricing for a very
long time because it works.
Pricing Tactic #6
Anchoring means setting a price as a benchmark which then
re-sets the customer's perception of its value and appropriate
price. The customer sees this "anchor" price first, and it sets
An example of anchoring is Starbucks charging $3 for a cup of
black coffee. If customers are used to the anchor price of $3,
a coffee shop can position itself as the anti-Starbucks (a local
place, etc.) and charge $2 per cup. Or, a coffee shop can
stress its higher-quality beans and charge $3.50.
Pricing Tactic #7