The human brain is willing to pay more for a product as long as it does not feel bad about it. Not understanding the psychology behind numbers causes businesses to lose money without realizing it. While many sellers will guess that the best price for the buyers is the lowest possible, it turns out that this is not entirely true – especially if you know how to use numbers. In other words – to sell your goods, you have to know how to price them. This article will tell you about the best NEUROPRICING practices and how they can help you grow your business!
WHAT DO YOU THINK IS THE BEST PRICE FOR YOUR PRODUCT IN THE MINDS OF THE CONSUMERS?
Our subconscious mind dislikes math and prefers simplicity when making decisions. Our brains are fast, but being in a rush, they make assumptions that are only sometimes correct. Therefore, it is astonishing to think that we can use the power of numbers to influence people’s decisions! We can’t deny the need for greater knowledge about consumer behavior – their motivations, preferences, and pain points.
Neuromarketing does exactly that – it teaches businesses how to connect with their customers. This is done through the use of elements from neuroscience – it gives you insights into what lights up a customer’s brain and how to capitalize on those responses.
FEAR OF MISSING OUT MAKES US PERFECT SUBJECTS FOR MANIPULATION
Numbers are the foundation of everything – we use them to communicate, persuade and sell. If you need to emphasize the value of a product, a number is the best way!
There is no better way to convince someone that something is worth their money than by showing them some positive statistics. For example, a friend recommends you an apartment they visited and loved. If he says that 9 of his friends have also vacationed there and had a great time, it will probably sound more appealing than just saying everyone had fun.
Why do numbers affect us so much? Well, in this case, they provide a sense of security. We interpret that information as confirmation that something is worth money and that we are unlikely to be disappointed. In our minds, we successfully avoided the possibility of a negative outcome.
That is because of a psychological effect known as loss aversion or the fact that humans suffer twice as much from losing something than they enjoy gaining it (Zhao, 2020). Even if you aren’t aware, you do the same thing daily, especially with products or service prices.
THINK YOU ARE IN CONTROL OF YOUR DECISIONS? THINK AGAIN.
The numbers you use in your pricing strategy can make a huge difference. Allow us to elaborate.
One research that used an eye-tracking method to test the packaging of different products showed that consumers mostly pay attention to the price. It is a technology that allows researchers to measure human reactions to certain stimuli by recording their eye movements. The results showed that, even if they weren’t aware, they looked at the price a few times, and longer than any other labeling aspects presented (Lombard, 2022).
These are types of research that we also conduct at our Institute. Using neurophysiological measurements such as EEG, facial coding, and eye tracking, we can get bias-free information about customers’ real needs and wants to create the most appropriate price strategies. You can see how we do it in the picture below. Call us today and test your price with advanced measurements!
The price is, in fact, such a powerful tool that it can even alter our perception to the fact that we de facto feel, in our brains, that we prefer expensive products over cheaper ones (Plassmann 2008).
AVOID THE BIASES AND THE GUILT TRIP!
Luckily, there is a way to avoid all the biases in the consumers’ decision-making process. The method that made it possible today for organizations to measure how a potential customer feels about the price of a particular product or service is called NEUROPRICING.
It’s a powerful neuromarketing tool that uses AI tools, eye tracking, facial coding, etc., to show consumers’ price perceptions, without considering any biases they might have.
So, thanks to neuropricing, we can get insight into what’s beneath the surface without letting systematic errors, like cognitive biases, get in the way (Nigdelis, 2017).
Some numbers make our brains happy. According to neuromarketing research, prices ending in the numbers 5, 7, and 9 are considered as Happy Prices, meaning that the brain will feel happy after purchasing among these prices listed and will quickly engage with the product or brand listed their products with those prices. That’s because people subconsciously round the price down, not up. Important note: this rule is not reserved for luxury brands, as they tend to use even prices.
But neuropricing doesn’t stop there.
WHAT IF WE TOLD YOU THAT WE CAN MEASURE EXACTLY HOW MUCH IS THE CONSUMER WILLING TO PAY FOR YOUR PRODUCT?
Neuropricing can play a significant role when selling your products, and it’s among the most frequently used neuromarketing strategies today. Understanding this concept can make the difference between one brand and another and truly skyrocket their sales. We are doing it, and so should you! Stop wasting time and money on traditional testing prices! Use Neuromarketing pricing testing, as this already works!
Asamoah, E., Chovancová, M. (2011). The influence of price endings on consumer behavior: An application of the psychology of perception. Acta Universitatis Agriculturae et Silviculturae Mendelianae Brunensis. Volume 59, pp. 29-38.
Lombard, W.A. (2022). Comparison of the importance of beef price labeling aspects: An eye-tracking approach. Heliyon 8.
Nigdelis, V., Tsolaki, M. (2017). Neuropricing: Perspectives of brain reactions to price exposure. Hellenic journal of nuclear medicine. Volume 20. Pp. 196-203.
Plassmann H. et al (2008). Effects of Pricing On Neural Correlates of Taste Pleasantness: Marketing Placebo Effects (MPE). The Proceedings of the National Academy of Sciences (PNAS). Volume 5, number 3.
Zhao, H. (2020). Loss Aversion: Will It Be Greater than the Gain? Financial Forum. Volume 9 Issue 2, pp. 71-75.
Other online sources:
Wright, Jan. (2018). The Origin of Cognitive Biases. EABA Conference. 10.13140/RG.2.2.30015.56484.