Improving Web Marketing Results By Leveraging Irrational Human Behaviors

[mandy]

The Power of Price

    Ariely, Waber, Shiv, and Carmon made up a fake painkiller, Veladone-Rx. An attractive woman in a business suit (with a faint Russian accent) told subjects that 92% of patients receiving VR reported significant pain relief in 10 minutes, with relief lasting up to 8 hours.

    When told that the drug cost $2.50 per dose, nearly all of the subjects reported pain relief. When told that the drug cost $0.10 per dose, only half of the subjects reported pain relief. The more pain a person experienced, the more pronounced the effect. A similar study at U Iowa showed that students who paid list price for cold medications reported better medical outcomes than those who bought discount (but clinically identical) drugs.

Lessons to Apply to Web Marketing:

    * Higher pricing means higher expectations, but also more fulfillment, even if the product isn't actually more fulfilling! Raise your consulting prices, people.
    * The Placebo effect is strong - don't abuse it, but leverage this knowledge to be smart about your own purchases and investments and as a potentially valuable tool to use in comparisons with competitive products/services/companies...

full article: http://www.seomoz.org/blog/10-irrational...-marketing