Selling the Invisible: a field Guide to Modern Marketing \(Biz Books to Go\) pdfdrive com

Ugly Cats, Boat Shoes, and Overpriced Jewelry: The Sheer Illogic
of Pricing
A Denver woman needed to sell four reasonably cute cats. She placed this
classified ad in the Denver Post:
“Ugly Cats. $100 each. 555-5555.”
More than eighty people called. She said she could have sold the cats for far
more.
Timberland was struggling in the early 1980s. The company made a good
boat-type shoe and priced it below the leader, Topsiders. A great product for the
price—but not a good business. Then Timberland did something fairly simple: It
increased its price to be well above Topsiders.
Sales boomed—just as they boomed for American Express when it took over
the prestige niche in credit cards by pricing its card just one dollar more than a
Diners Club card.
In Influence, Robert Cialdini tells about the frustrated owner of a Native
American jewelry store in Arizona. The owner had not been able to sell some
turquoise jewelry, even though it was peak tourist season. She tried sales.
Nothing. She tried sales “training” (she encouraged her staff to push the
jewelry). Nothing.
Finally, the night before she was leaving for a trip, the owner left her head
saleswoman a note: “Everything in this display case, price × ½.”
The owner returned a few days later and learned that everything had sold—
but not for the reason she thought. The saleswoman had misread the owner’s
scribbled note to read “price × 2,” and doubled the price of everything!
Some people think pricing is one of the more logical acts of marketing. These
examples say something different.
Don’t assume that logical pricing is smart pricing. Maybe your price, which
makes you look like a good value, actually makes you look second-rate.
Pricing: The Resistance Principle
Just months into business, I have made my first great discovery about business,”
a young woman recently told me. “There’s one simple way to get all the

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business you can handle: Charge almost nothing.”
She’s right.
If no one complains about your price, it’s too low. If almost everyone
complains, it’s too high.
So if no price resistance is too low and 100 percent is too high, how much
resistance is just right? How much resistance tells you that your price is right?
Fifteen to 20 percent. And there is one simple reason why: Close to 10
percent of people will complain about any price. Some want a deal. Others are
mistrustful and assume every price is overstated. Still others want to get the price
they had in their mind when they approached you, because it’s the price they
hoped for and already have budgeted in their mind.
So throw out the group that will object no matter what your price Then ask:
In the remaining cases, how often do I encounter resistance?
Resistance in 10 percent of those remaining cases—for a total of almost 20
percent—is about right. When it starts exceeding 25 percent, scale back.