When you’re selling something have you considered the impact your pricing plays in they buyer’s mind?
Price is a fine line to dance across and it hit me (again) the other day when I was filling up my car with gas. I was a little taken back when I saw the prices for gas. The options were:
- Regular Unleaded – $2.19/gallon
- Plus Unleaded – $2.29/gallon
- Super Unleaded – $2.19/gallon
I normally fill up the car with Plus because it’s generally about $.10 less than Super and, well, it’s the middle option. I don’t simply want the cheap stuff.
On that day however, I filled up with Super (the real good stuff, right?) because it was less expensive than the Plus I normally buy. However, as I was leaning up against my car watching the numbers roll by on the pump, the following thoughts kept playing in my head:
- Why are they pricing the premium stuff so low today?
- What’s wrong with this batch? Is it filled with the crud at the bottom of the storage tank?
- Did they really make a price mistake and I’m getting away with something?
- Should I go inside and ask to make it’s not the crud and I don’t hurt my car?
- Why isn’t this advertised on the sign, what’s wrong here?
- Am I the only one seeing this mistake?
Then I realized what I was doing and stepped back to analyze the situation.
Think about it now. What does pricing play when you’re working to sell something? Does it convey “cheap” or “inferior?” Does it convey there could be a problem compared to the other options available? Does it convey “bargain?” Does a higher price imply “quality?”
As I said, this is a fine line and needs to be handled with care. It’s not so easy as to say, “do you present the low price option first and work to up-sell? Do you present the high price option and down-sell if they don’t buy the first option? Do you present multiple options and let the buyer choose the price?”
Each product and situation is different and careful consideration has to be brought to the table when pricing. Often bringing multiple options will confuse the buyer and put them into a state of indecision.
I wish there was a flat answer to these questions to make it simple. However, I’ll be exploring these more in time.
Where I live (Nebraska), the higher octane gas is cheaper because it’s 10% ethanol, which is subsidized. Sounds great, but apparently it burns hotter (so you need to verify whether your car can handle “E10″), and some people say it gums up your engine.
I go for the lower price. But I occasionally wonder whether maybe I should run a tank full of the other stuff through.
Antone,
That’s interesting. It’s never less expensive here. But, from what you said, it does seem to place a bit of doubt on the product quality even though that’s “the norm.”
Thanks for sharing.