Psychological pricing principles

Psychological pricing uses cognitive biases to influence how customers perceive and respond to prices. These techniques tap into mental shortcuts that drive purchasing decisions beyond pure logic.

Common psychological pricing tactics include:

• Charm pricing: Prices ending in 9 ($9.99) signal bargains while round numbers ($100) suggest premium quality
• Price anchoring: Show expensive options first to make other prices seem reasonable by comparison, or showing the original (higher) price next to the discounted price, so the lower price feels like a strong deal.^[1]
• Rule of 3: Offer 3 options to trigger the compromise effect, driving most customers to the middle choice
• Decoy effect: Add a slightly worse option to make your target option look better
• Bundle pricing: Hide individual costs by grouping products together
• Reframing: Present $30/month as "$1 per day" to minimize perceived cost

Understanding these biases helps craft pricing that resonates both emotionally and logically with your target customers.