We would like to thank our guest writer, Calin, an MBA pricing professional turned wedding photographer for his contribution to this article. For more information about him and his work, please visit www.bycalin.com
Left Brain vs. Right Brain and Pricing
With the proliferation of online commerce (Amazon, we are looking at you), as consumers, we have been programmed to look for deals. The web offers the perfect medium to compare product prices. However, we are often tricked into purchasing with the help of unethical means.
Our left brain is the one making analytical decisions and that is the brain we are using to make rational purchasing decisions. Here is how we buy products and services. Using our left brain, we analyze information including price, quality, next best alternatives and their prices and other pieces of the same puzzle. When most of our purchasing criteria are fulfilled, we go ahead and purchase the product or service.
However, it is a well-known fact that certain events, information and actions short-circuit our thinking process and cause a transfer of the cognitive flow tool our right brain, the one who is our emotional thinking machine.
For example, when we see the words discount, sale, or limited time offer we stop using our left brain for decision-making and our right brain takes over. In effect, the above mentioned cues will cause us to stop thinking rationally and make the purchasing decisions based on emotions.
That fact is well known by many retailers who present the higher price and then show a limited time offer. According to the New York Times, companies such as Amazon, Williams-Sonoma and many others use a "fake" offer to create a sense of urgency so that we buy now.
There are four purchasing triggers that worked all the time. First, we buy when we know we are getting a deal. Second, we are compelled to buy when the offer is time limited. Third, we tend to buy more if we know other people also took advantage of the deal. Fourth, by more often if we know that there are only a few items left and there is a high demand for them.
Amazon deal of the day is a perfect example where they show the "original price", how much you save, the fact there are only a few items in stock (more to come).
What New York time discovered was that the or original price of the products investigated (in this case a Le Creuset skillet) was artificial and one could never buy the product at the original price. It was just a scam used to create a reference point that would make the "sale price" look good so that customers would buy.
Misleading Reference Prices
By listing misleading reference prices, the retailers inflate the perceived savings, which makes a purchasing decision an easier one for the client. However, everybody does it frequently, that becomes illegal.
The reference points I used just to convince us that we are getting a very good deal.
Companies such as J.C. Penney tried to depart from the practice of the posting boosted reference prices and saw their revenues declined by 25%. As such, they reverted to the tried and true method of posting artificially high reference prices so that we can feel better that you are getting a deal.
The Wedding Industry Uses the Same Techniques
Sadly we saw wedding professionals practicing the same tricks to convince their customers to purchase. Many wedding photographers post on social media 30% discounts after they have artificially increased their prices by 30%.
How to Ensure You Are Getting a Deal
If you are looking for a wedding photographer, videographer, officiant, planner or DJ and want to ensure you're getting a deal, you need to go back in time to check the vendors or original prices. Enter the way back machine a archive of webpages that can help you decide if the price you are getting is indeed a good one.
If you are buying for some wedding products, Google shopping if your best friend. Simply enter the name of the item you're looking for and Google will bring you the best prices on the web.
For services, of course use our own website to find the best deals in your city.
We know wedding planning is very time-consuming and often you do not have information or the energy to do a thorough search for the best deals. That is why our website is here to help you find the services and vendors that please not only your eyes and taste buds but also your bank account.
Be careful when you see limited time offers and do your homework properly so that you can rest assured you got a genuinely good deal.
Are You Really Getting a Discount, or Is It Just a Pricing Trick? by Rafi Mohammed, Harvard Business Review, March 23, 2016
It’s Discounted, but Is It a Deal? How List Prices Lost Their Meaning, by David Streitfeld, New York Times, March 6, 2016