The key pros and cons of price psychology
In this tough economy we currently find ourselves in, fierce competition contains intense price battles, battles that often involve the use of strategic planning and a particular pricing strategy, for example psychological pricing.
All pricing strategies have advantages and disadvantages, similarly, nothing is perfect. Some of the main pros and cons of using psychological pricing are outlined below.
Let’s start with the cons first, shall we? Consider the meaning behind psychological pricing, its goal is to play “tricks” on the minds of human beings, to trick us into creating something that is not equivalent to your true self. The only word is perception.
By exploiting psychology, marketers are creating a different perception of something for us, therefore what we think it is, is what we believe. The downside to this is … as a typical consumer possibly falling for this pricing strategy, they may as soon as they realize they were misled and therefore will no longer buy that particular offer again.
What can be learned from this is that all pricing strategies need to be carefully planned to avoid crossing the line that can cause side effects.
Another downside to using the concept of psychological pricing is that you are not alone, you are simply not the first to use this tactic in economics. The fact is, when everyone else in your competition is using the same trick as you, it’s basically communism. The trick will degrade because most are doing the exact same thing.
From this understand that you have to stand out from the crowd and yearn for some originality in your pricing campaigns, be unique.
Everything in the world has advantages and disadvantages. Using a pricing strategy will not only increase your sales and generate more profit, it has other key benefits.
Have you ever been frustrated by the unexpected results of a plan? Any plan? In fact, no plan in the world is error-free, and all plan implementers are often concerned about potential outcomes and unfavorable side effects. However, in pricing psychology, minimal attention is required, as all these pricing tactics are aimed at humans, and I assume that humans are the only buyers in the world.
Having said that, there are certainly no areas of failure in terms of using psychology in pricing, but only the effectiveness and positive results you are getting that require serious effort and work, in other words, the amount of work determines. your rewards. However, the split test is the best option.