The Psychology of Pricing - What's the best price to charge?

I recently read an article written by Michael A. Jones. Here's an summary of what he's found to be true when it comes to pricing.

Much research has been done regarding pricing levels and the numbers that seem to be more appealing to consumers. Of all the numbers, the number 7 scores very highly in a customer's perception.

Here are the findings in an easy reference list:

Prices Under $10

End the price with 99 cents rather than 95 cents. It doesn't make any difference to customer perception whether the price ends in 99 or 95 cents in this low price range so make every cent you can. If you are able, set your price at $7.99, and take advantage of the power of the number 7.

Prices Between $10 and $100

Here a different set of psychological elements come into play. We are now dealing with a higher price range and to finish a price with 99 cents seems as if the marketer is trying to squeeze just that little too hard. 75 cents and 95 cents seem to be more acceptable. Again, if the first figure can have a 7 in it, e.g. 17.95, 27.95, etc. it seems to work better.

Prices Over $100

With higher priced items, forget about the fractions. A clean round figure works best. And remember to incorporate the number "7" into your pricing (e.g. $127, $147, etc.).

Special Note for Service Businesses

To offer a service for $59.95 an hour doesn't sound right. Round it off to $60, or whatever figure you set for your charges. Customers don't expect an 'on sale' kind of mentality when it comes to paying for professional services.

King of Glory Children's Ministry Needs Your Help

Several months ago, I shared a vision for helping children. Since then, I was able to take this vision and start a non-profit corporation in the State of North Carolina under the name of King of Glory Children's Ministry.

The vision is coming along, but we need your help in filing for Recognition of Exemption as a 501(c)3. Over the next 26 days, we're asking people to pledge $10 to help us achieve this next step in our formation. Your contribution today, will help us bring a message of hope and love to children tomorrow.

CLICK HERE TO PLEDGE $10

Everyone who makes a pledge will be listed on the Current Partners page of the ministry web site. You can even make a contribution in memory of a child or loved one who has passed from abuse, addiction or suicide.

Fusion Marketing - Your Target Audience

By: Pam Small, Owner of Refresh & Renew

The first step in establishing your Fusion Marketing Strategy is to decide what audience you will be targeting. If you've chosen your Fusion Partners wisely, you know they wish to target the same audience as you and they may already have determined the demographic they want to zero in on. You would be amazed at the number of small business owners who have not done the research to determine who is most likely to buy their products and services.

While some products and services span a wide range of potential customers, others require a very specific demographic. For instance, a gift basket company would have a wide range of potential customers while a lactation consultant would have a very specific demographic. Some broad demographic segments would include gender, age, income level, marital status, religious affiliation and location. The segments can be narrowed greatly by determining members of a specific group of people like club membership or which private school their children attend. You can research a population's makeup in terms of age, gender, occupation, family circumstances and income by checking out the most recent edition of the Country & City Data Book, published by the US Department of Commerce.

Where does your audience live? Do they make most purchases online or do are they loyal to local business? Do they spend most of their time outdoors? What have been their spending habits? Are you targeting professionals or people who own home-based businesses? Each partner in the Fusion Team should bring to their strategy meeting the demographic of their targeted audience and be prepared to determine the best way to reach this audience.

Next time, we'll explore some of the best methods of marketing to very specific market segments.

Pam Small is the owner of Refresh & Renew - A Resource for Women. Having a heart for women's issues, Pam is quickly becoming the go-to person for helping small business owners target their marketing efforts to this powerful buying group. For more info, visit www.refreshandrenew.com or email Pam at psmall@refreshandrenew.com.

5 Ways to Begin Purpose-Driven Planning

Many people are in a financial rut because their spending habits are made without a purpose or vision in mind. Whether it's going to the mall, grocery store, or sitting with a financial adviser, all decisions should be pushing us closer to fulfilling our overall financial vision.

We must take the time to evaluate whether our decisions are keeping us on track to accomplishing our goals, or pulling us further away. Financial success is not always about making right or wrong choices. Financial success is about taking responsibility to make choices that position us for success.

Despite the grim economic forecast of recession, foreclosures, and rising unemployment rates this is the perfect time to establish a new order in your life. Purpose-driven financial planning positions us to weather any economic storm and stay on course to achieving our goals.

Here are "5 Ways to Begin Purpose-Driven Planning"

1. Develop a vision statement for you and/or your family. Begin to see the end from the beginning.
2. Create a "goal-oriented" budget and begin to use it as your road map to fulfilling your vision instead of keeping your focus on just paying the bills.
3. Keep a financial diary and begin to track your expenses.
4. Focus your spending decisions around helping you achieve your goals.
5. Make a decision not to allow your emotions to justify irresponsible behavior.

Jaynee Sasso is an author, speaker, and creator of the "Commonsense Way to Wealth" coaching system. We are very luck to have her as a contributor to our bi-weekly e-newsletter and blog. For more information, please visit www.commonsensewaytowealth.com or email infodesk@faithfulassistants.com.