"The price ultimately sells the item," is a statement you’ll often hear in the retail and pricing industry. When selling goods in brick-and-mortar stores or in e-commerce, many factors contribute to whether the customer buys an item or not. In addition to delivery time, assortment breadth of the store and returns handling, price also plays one of the most important roles in the purchase decision. For this reason, the field of price psychology is becoming increasingly large and popular with vendors of all kinds.
Price psychology:What is it?
Price psychology deals with the effect of numbers and encompasses everything to do with psychological pricing.Thereby, the respective pricing strategy usually aims at an increased sale of goods. These strategies can look quite different.
Do not confuse pricing psychology with repricing strategies: Repricing also often makes use of models of price psychology, but repricing is about always keeping the item prices for one's own assortment optimal by regularly adjusting prices in relation to the competitive situation. Best-price strategies or top-seller strategies can be used for this purpose, for example.
"More on repricing strategies"
Pricing psychology is less concerned with the exact price level and more with the effect of individual numbers on people. This effect is aimed at emotional motives in a customer's purchase decision and assumes that it is not exclusively the lowest price that appears attractive to the consumer.
The broad field of price psychology
This mindmap is intended to give an overview of the different areas of price psychology.
Price psychology has existed for as long as prices have existed in any form. For about 15 years, e-commerce has also been part of this field, although some price effects are not as relevant here as in stationary retail. In the following, it will be emphasised once again where price psychology is also applied in e-commerce.