I just finished reading Predictably Irrational by Dan Ariely. It's an interesting book as a whole, but particularly interesting to marketers was right at the start of Chapter 1, where he discusses some various pricing options of the Economist, and how by adding a 3rd pricing option that no one picks, more people choose the higher price. See below for the data the book presents:
Original pricing:
Economist.com Web Subscription: $59 (68% choose this)
Print Subscription and Web Subscription: $125 (32% choose this)
New pricing, driving a higher percentage of $125 subs:
Economist.com Web Subscription: $59 (16% choose this)
added Print Subscription: $125 ( 0% choose this)
Print Subscription and Web Subscription: $125 (84% choose this)
Very interesting, by adding a pricing option that no one chose, the Economist raised its revenue per subscriber from $80.12 to $114.44. The book is worth picking up, even if the later chapters are not as directly applicable for us marketers.
If anyone has reading recommendations with similar examples, please do share.
have heard 'influence....' is a really great read and throws up some new perspectives.
Posted by: Get On Google | October 21, 2009 at 07:11 AM
Great Info! Thanks for the post!
Posted by: Jessica | October 08, 2009 at 01:54 PM
I just picked up "Influence: The Psychology of Persuasion" for this weekend, I'll let you know my take in a few days.
Posted by: John DeMayo | August 29, 2009 at 01:17 AM
Read the book August last year and IMMEDIATELY added a new “product” option for our retail mortgage transfers:
http://www.doublepositive.com/mortgage/pricing.asp
We’ve never sold one “Name-Your-Script” transfer (and never expected to), but man did it liberate the $89 price point. ;-)
The other thing in the book that blew me away was the test vs. control results of the veterans that had major heart surgery vs. “spoofed” major heart surgery.
So, believe what you want. Your thoughts will manifest reality.
SPF
Posted by: Sean Fenlon | August 24, 2009 at 12:39 PM
that is the mcdonalds triple cheese burger sells more double cheese burger theory.
Posted by: Jeff E | August 23, 2009 at 05:40 AM
One of the best books I've read recently. That's my favorite story, some people we know have tried that technique.
Posted by: Rob D | August 21, 2009 at 05:06 PM
Heh - that was the only part of Predictably Irrational that stayed with me as well. Read the book when it came out and I still use that example.
Posted by: Greg Yardley | August 21, 2009 at 05:08 AM