Picture this: You’re mindlessly scrolling through your Instagram feed, and there she is – Kylie Jenner, effortlessly flaunting the latest makeup trends. Now, Kylie is not just a reality TV superstar; she's a mega influencer with millions of followers. When you see her sharing her makeup tips and product recommendations, you can't help but feel a sense of wishful identification. You admire her glamorous lifestyle and think, "Maybe I can achieve a touch of that too!" It's like having a front-row seat to the world of luxury. These feelings of identification with Kylie spark a desire to emulate her, and suddenly, those makeup products she's endorsing become must-haves in your beauty routine.
Suppose you want to sell a cupboard; how do you determine the price? You will probably compare prices with similar ones and how much the purchase price was. Buyers, in turn, will judge it on external features: how many drawers are there, what material is it made of? Yet often there is a difference in what the seller thinks a product is worth and what the buyer is willing to pay. This is also called the endowment effect (Thaler, 1980).
However, society is becoming increasingly technological, and more (digital) services are offered. Think, for example, of a platform like Amazon, a company specializing in data privacy, or the experience of going to a concert. How are these services evaluated? And more importantly, how big is the seller-buyer gap? Let’s dive in!
It’s Saturday night and you’re watching your favorite show. As the show reaches a thrilling climax, it cuts to a commercial break, and that is when your eyes catch something extraordinary. You come across a mouthwatering food ad that stands out from the rest. The perfectly plated dish looks incredibly delicious. However as a health-conscious individual, you are curious about the nutritional information of this tempting meal.
Do You Think You’re Funny? Try Being Clever Instead and Watch Your Customers Fall in Love With Your Brand
What is the absolute dream of a brand struggling with a dwindling consumer base? Waking up to find out their demand has suddenly gone through the roof and the biggest problem is not being able to keep up with production!
That’s what happened to the confectionary brand MoonPie when they changed marketing tactics in 2017. Was it their product? Their distribution or sales promotion that they’ve changed?
Marketers love to end their prices with the magical numerical combination of 99. This practice, which is also known as charm pricing, psychological pricing or odd pricing, is seen in virtually every country across the globe. There’s no question about it: it works. But new research shows that the pricing trick will backfire under specific circumstances.