Finology Quest
Finology Quest

@Finology_Quest

6 Tweets Dec 09, 2022
Sale ! Sale ! Sale ! ๐Ÿ˜
Your feed must be flooded with discounts by now. We all love discounts, donโ€™t we?
This love for discounts is not because of the economics around it but because of the psychology behind it.
An Imp Thread๐Ÿงต
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#StockMarket #nifty50 #BlackFriday
Letโ€™s learn about some psychological pricing strategies that brands use
Charm pricing: It involves using pricing tht ends in "9" & "99. This is done bcz the brain processes Rs. 300 & Rs. 299 as diffn values. To your brain Rs.299 is Rs.200, which is cheaper than Rs 300.
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Comparative Pricing:
How to sell a watch that is priced at Rs. 10,000? Put aside a similar watch which is priced at Rs. 30,000. This, my friend, is a psychological game that most brands play.
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Price Anchoring:
Likewise is the case of price anchoring where brands increase the price of a product initially and then provide hefty discounts on it. This creates an illusion for the customer who thinks he is getting a premium product at a low price.
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Decoy Pricing
The decoy pricing tactic is when a customer is presented with an option of two or more products, one of them being inferior. The presence of the โ€œinferiorโ€ option makes the other products seem more attractive.
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For eg:
#Apple launched Iphone 8 at 60k and X at 1 lakh, simultaneously. Iphone 8 had features similar to the Iphone 7. Iphone X, on the other hand,offered a lot of edgy features.
By portraying Iphone 8 as an inferior product, they persuaded people to buy #Iphone 10.
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