The cost is 200 yuan, but the product is sold at a price of 1,000 yuan. What marketing techniques are used?

You get what you pay for is absolutely a wrong concept in business. The room for price manipulation is far greater than people imagine.

People intuitively believe that the price of a product is generally composed of costs (raw materials, labor, rent, water and electricity, etc.) plus some reasonable profits.

However, if the pricing of goods were determined according to this method of addition and subtraction, there would be no clothes costing thousands of dollars, bags costing more than ten thousand dollars, and perfumes costing tens of thousands of dollars on the market.

Pricing has little to do with mathematics, but is closely related to the "sense of value" of the product.

Every product has its "value", and this value is not the "price" but the "product benefits" that consumers can feel.

This “perceived benefit” is the “perceived value” of the product.

For example, a certain high-end cosmetic on the market advertises that its main function is to remove wrinkles and make the user look "younger". This "younger" is the "perceived value" that the product provides to consumers.

For example, at Luo Yonghao ’s mobile phone launch conference, before announcing the price, he would review the phone’s configuration. The main purpose of this was to increase the “perceived value” of the phone and make the price look more reasonable.

Or the "craftsman spirit" that Luo Yonghao has always emphasized in the early days is also a kind of "perceivable value" added to the product, making the high price of the mobile phone seem reasonable.

Of course, whether you are buying cosmetics, mobile phones or something else, you have to spend money, and the money you spend is the "perceivable purchase cost."

The perceived product value minus the perceived purchase cost is the "sense of value" that consumers gain.

Sense of value is the core of pricing. The greater the sense of value, the higher the consumer acceptance and the greater the pricing space.

So according to this logic, there are two ways to increase the value of a product:

Increase the perceived value of the product and reduce the perceived purchase cost of the product.

Perception is greater than fact, this is one of the most basic laws in marketing .

Regardless of whether the product is of the best quality or not, the key is to make consumers perceive that the product is of good quality.

Regardless of whether sales volume ranks first in the industry or not, the key is to make consumers perceive that sales volume ranks first.

Regardless of whether the product has the best value for money, the key is to make consumers perceive the super high value for money.

same.

The product value that consumers can perceive is the value they really want to buy; the purchase cost that consumers can perceive is the cost they care about.

A steamed bun sold in a street shop may only cost 2 yuan, but if it is placed in a star-rated hotel with an elegant environment, exquisite plates, and high-quality waiters, the price can be raised to 20 yuan each.

The environment, plates and waiters here increase the perceived value of the buns.

The market price of an in-car air purifier is 2,000 yuan, but if a 4S shop sells the purifier to you as a bundled product when you buy a car worth more than 500,000 yuan, you will not feel anything.

The piggyback sales here means reducing the consumers’ “perceivable purchase cost”.

Manipulating consumer "perception" as described above is one of the core strategies of pricing.

In the "Copywriting Training Manual" by copywriting master Sugarman, in order to illustrate the importance of building a "buying environment" in copywriting, he told such a story.

One day he visited a gallery in Honolulu. The gallery looked quite stylish, with all the paintings hanging elegantly on the walls.

Sugarman took a fancy to a painting.

At this time, the sales lady came over, greeted me and said, "This painting is nice."

Sugarman nodded.

Then the sales lady said, please follow me.

She took down the painting and led Sugarman into a large room.

The room was decorated quite luxuriously, with gorgeous carpets covering the ceiling and floor.

The sales lady turned on a classical gramophone and beautiful classical music came out from it.

Then she hung the painting on a wall, dimmed the lights, and turned on two spotlights to shine on the painting.

At this time, Sugarman was already stunned. He felt that this painting was the best painting in the world, no doubt about it!

The end result was that Sugarman couldn't wait to buy the painting.

Sugarman tells this story in his book to illustrate the importance of constructing a perfect buying environment in advertising copy:

When you want to sell a high-end product, the sales environment must also be high-end to match it.

Why does the environment affect prices?

William Poundstone's answer is that people take clues from their surroundings when estimating prices .

To put it simply, people will get clues about how much something is worth based on its appearance .

For example, when we go to a restaurant to eat, it is difficult to determine the actual price of the food itself (such as a steak). It is more likely to be determined by external factors such as the restaurant's decoration, tableware, specifications, and services.

Or, someone wants to learn the success course from "Master XX", which is priced at 9,980 yuan.

It is actually very difficult for students to determine whether the fees they have to pay are reasonable based on the "course" itself. Instead, they have to refer to external factors such as the teacher's qualifications, reputation, and title.

So these "success mentors" always like to brag about how rich their qualifications are.

The "external factors" of these commodities will directly affect the perceived value of the commodities. In other words, as long as the external factors are increased, the perceived value of the commodities will be increased.

Since "external factors" can increase the "perceived value" of a product, how can we construct external factors scientifically?

The answer is: "positioning first, then pricing."

The "positioning" mentioned here is completely different from Trout's classic "positioning theory".

The positioning here is to first determine what needs the product solves.

Then, on this basis, a series of pricing "matching" is carried out. In simple terms, it is to create a series of supports (external factors) for your "pricing".

Take the most common bags as an example.

Female consumers' demand for bags can be simply divided into two categories:

The most basic need: to carry things

High-level needs: as an accessory and to reflect identity

When a bag is positioned as a "bag for carrying things", the price and fit are the lowest.

For example, the sales location is likely to be a small street shop, where bags are displayed together with student backpacks, electrician bags, and ordinary luggage bags; the selling point of the bags is that they are "sturdy and durable"; and the shopping guide is the boss's wife.

The "matching" of the above external factors all reflect the "demand points" of packaging.

However, if we define the function of bags as something more sophisticated, they can be considered as accessories for women and reflect one's identity.

At this time, the price of the bag can be reasonably increased, and in order to support this price, the bag must also meet this demand in terms of external factors.

For example, the sales location is a luxury goods store, the decoration is high-end, the shopping guides are high-end, the neighbors must be Chanel or Kuqi, and the buying point is the designer or brand culture.

Therefore, consumers' perception of the value of a product is largely based on what kind of consumer needs the product solves. The more valuable the product, the more it tends to meet emotional needs, such as jewelry, cars , cosmetics, etc.

In order to make the selling price seem reasonable, we must rely on similar pricing "matching" to increase the sense of value and make it acceptable to consumers rationally.

This is why, although Zara is not a luxury brand, when it opens a store, it is always located next to LV and Prada in the most prosperous shopping malls.

When you buy Afu essential oil on Taobao , you will find a bunch of small gifts that will make you happy when you open the box.

This is why Luo Yonghao desperately promoted the "craftsman spirit" when the early Hammer Phone T1 was priced at 4,000 yuan.

In short, packaging, gifts, brand culture, service experience, neighbors, stories, etc. are all bricks and tiles that support the product price.

For example, when we wash our face with warm water, it is difficult to determine whether the temperature of the water is 40 degrees Celsius or 30 degrees Celsius without using a thermometer.

But if you are given two basins of water, one at 40 degrees Celsius and the other at 30 degrees Celsius, even if we don't use a thermometer, we can determine which basin of water is warmer just by feeling it with our hands.

The same phenomenon is reflected in commodity prices: we are relatively numb to absolute prices but very sensitive to relative prices.

That is to say, only after comparison can we "determine" whether the price is reasonable.

For example, if we want to buy a pack of biscuits priced at 20 yuan, we cannot be sure whether the price is worth it just by looking at the price.

But if we see other similar biscuits in the store that are priced at 25 yuan, then we can be sure that the 20 yuan package is a better deal.

This phenomenon is called "reference dependence" in marketing.

Once we understand this characteristic of marketing psychology, we will have a lot of room for maneuver in pricing.

Based on this, two groups of cases are listed below to illustrate.

1.

When we are walking and feel thirsty, we go to a convenience store to buy a bottle of ordinary Coke and find that the price is 10 yuan. At this time, we may think it is too expensive and give up the purchase.

But when we go to a restaurant to eat hot pot, ordering a bottle of Coke for 10 yuan doesn’t seem expensive.

Similarly, when we buy a bucket of popcorn at a convenience store, 10 yuan may seem a bit expensive, but when we go to Wanda to watch a movie , spending 30 yuan on a bucket of popcorn does not seem expensive.

Similarly, if a thin piece of watermelon is sold for 20 yuan, we would think that the merchant is crazy. But when we climb to the top of Mount Tai and spend 20 yuan to buy a piece of watermelon, we will not care too much.

This is the main and by-product pricing.

2.

There is a British artist named Hirst who created a platinum skull artwork inlaid with 8,601 diamonds. He named it "For God's Sake" and sold it for $100 million.

Although Hirst is a relatively well-known artist, his bid of 100 million still had a shocking effect and was widely publicized in the media.

But the market response was cold and no one came to buy.

Finally one day, Hirst announced that the skull artwork had been purchased by an investment group.

But in fact, this investment group belongs to Hearst himself.

Hirst played this trick because the extremely high price of this skull artwork can drive up the prices of other works.

As a result of the hype, several of his other works have achieved auction totals exceeding $200 million.

For example, Victoria's Secret produces several sky-high-priced lingerie every year, some of which are priced at more than 3 million US dollars.

Victoria's Secret managers should also know that not many people would buy such sky-high-priced underwear.

But doing so will make the brand look more high-end and make the price of ordinary Victoria's Secret underwear seem more acceptable.

For example, when you go to a hotel to eat, you see the dishes on the first page of the menu, such as the supreme lobster for 999 yuan, the sea cucumber porridge for 599 yuan, etc.

When you think this dish is ridiculously expensive, look at the second page and you will find that the average price of dishes such as river shrimp and Buddha Jumps Over the Wall is between 150 and 250 yuan.

You will suddenly feel that the cost of this hotel is not too expensive.

This is the use of the "anchoring effect":

Using high-priced products will fix the consumer's psychological price point at a high level. When he sees the second highest price, he will be more likely to accept it.

In fact, in marketing pricing, there are many ways to utilize consumers' "reference dependence", and its scope of application far exceeds the few examples listed above.

If you have a strong understanding, you can use the principle of "reference dependence" to come up with countless tricks in pricing.

The core of this method is to reduce the "perceived purchase cost" and make the selling price of the product appear lower.

The key to expanding the pricing space of goods is to improve the "sense of value" of the product, that is, to make consumers feel that they "spent reasonable money and bought a better experience."

There are several techniques for this.

1. The perceived product value minus the perceived purchase cost is the "sense of value" that consumers gain.

Therefore, improving the "sense of value" can be divided into two aspects: increasing the perceived value of the product and reducing the perceived purchase cost of the product.

2. The product value that consumers can perceive is the value they really want to buy; the purchase cost that consumers can perceive is the cost they care about.

3. The "external factors" of a commodity will directly affect the perceived value of the commodity. As long as the external factors are increased, the perceived value of the commodity will be increased.

4. First determine what needs the product solves, and then make a series of pricing "matching" based on this, which can increase the perceived value of the product.

5. If reference dependence is used properly, it can effectively reduce consumers' price perception.

Source: Copywriter Yu Ji (ID:jimtchina)