Business Magazine

The Psychology of Pricing

Posted on the 22 May 2015 by Worldwide @thedomains

For many domain investors negotiation and pricing is some of the trickiest and hardest things to learn. While there is no exact science, experience and a ton of previous transactions help the most, there are strategies you can employ to help with your negotiation and pricing.

Mike stumbled across a very extensive article from Nick Kolenda that deals with the psychological aspects of pricing. The article is very long and detailed, so I would suggest you bookmark it as it is a lot for one reading. Nick also made a video that highlights the main points of the article.

From the article:

Step 1: Determine Your Price

Large companies have an advantage. They can afford cream-of-the-crop marketing research (e.g., conjoint analysis) to find the optimal price for their product. Small businesses don’t have that luxury.

Fortunately, that’s where psychology can help.

Based on research in cognition and behavior, certain prices are more effective than others. Even if you don’t find the exact sweet spot, you can make small — yet powerful — adjustments to maximize the effectiveness of your price. All for free.

In this section, you’ll learn how people process numerical values (and how to choose the numbers in your price, accordingly).

Read the full article on NickKolenda.com


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