What I learned from this video was the concept of making precise offers. I always thought that the point of pricing something at $3.99 was simply to fool people who don't look closely at numbers (my mom would look at that item and say "oh its only 3 dollars!") What I learned from this video is that it also makes the offer more precise and subconsciously causes you to want to bargain on a much smaller scale. Lately I have been constantly going to job interviews to try and get a better paying job. I'll have to try this technique. Instead of asking for $13/hour I'll ask for $12.95. I can see how this would lead to a counteroffer like $12.50/hr when I may have otherwise been counter offered a flat $12/hr. Thank you for the informative video!
In regards to the shoes and the $150...I had a friend's father no matter if something was 50% off say $100 he would look at at it as he spent $50 instead of saving $50. You didn't save anything, you spent and that is the bottom line
I've heard of the the shoe pricing thing before refereed to as the "JcPenny's effect" how it got that name is at one point when they had just gotten a new ceo he wanted to do away with deceptive sales practices and be honest with what the prices are and why they are set where they are. So he had all the stores stop doing all the sales and discounts that weren't really for a limited time, or on any actual markdown. And only put out the best price on the item and that was it. His stores lost big to their competitors who everyone though where selling the same stuff for cheaper. but when they went to compare prices the other guys final price the one the customer actually pays, and their prices where the same, and in some cases they where actually cheaper but people still thought they where the more expensive option on everything. So they marked up all their stuff, so they could put on sales and other discounts to bring it back down to where it started from and they eventually got their sales back up once people got word of the new sales starting up again.
I've always, in my mind, ignored the weird prices. 3.99? FOUR bucks. 99cent? A DOLLAR. I have this so ingrained that I've had people "correct" me, if we're discussing the price on something. eg. "What do you mean four dollars?.. It costs 3.99..." I kinda thought the point of pricing things like that was to trick people into thinking they were spending less money than they actually are. Like, 29.99 vs 30$ ... 30 dollars sounds like quite a bit more money than some amount that resides somewhere within the twenties, right?
Exactly. I used to say stuff like this when I was 8 and people gave me confused looks as if I was talking nonsense. I see now that they were the ones who couldn't comprehend what I had noticed.
Same thing happened to me. People try to "correct" me, but really it's just rounding to the nearest whole number. I think prices are set like that because when something is priced at $30, it looks a lot more than $29.99 to a lot of people because $29.99 is in the 20's and $30 is in the 30's.
It's particularly amusing with gas prices, such as $2.859 per gallon. If you buy 10 gallons of gas, your total will be a whopping 1 cent less than $2.86 per gallon. Who do they think they are fooling?
danielsjohnson that's imho a mistake alot guys make. "i would never pay more then 100$" for shoes". And every year they have to buy a new pair, or even worse, they don't and run around with unhealthy shoes. Buy a pair for 450$ and they will last you years.....
I do this for a living and when selling secondhand merchandise it never hurts to ask the buyer to "make an offer". Being a seller you can always have a minimum in mind. Simply say no if they don't reach it and counter offer above your minimum. If they offer more than the minimum either haggle the price up or accept. This video is geared more towards buyers who have a general understanding of the object in question.
Most of the time yeah, but at some point in your life you are a business person - whether that's professionally as a job or you're just selling something at a carboot/garage sale. It's also good for noticing when these tricks are being used to help you avoid them.
Sadly you didn't explain the 29.95 properly. It's because it's a much bigger cognitive load to think about what round number this fractional number is close to, and people's "system 1" thinking takes a shortcut to what you hear ("TWENTY-NINE" in 29.95) and it FEELS like they are getting a WHOLE DOLLAR less than the completely different number "THIRTY" when in reality it's just FIVE CENTS less. Once I realised this marketing tactic, I always force myself to do "system 2" thinking and round the price up. There has been several instances where I talked to a sales person like this (to constantly remind myself AND others of this trick): "So it's thirty dollars huh", "sir, only twenty-nine ninety-five great offer today" (me louder) "hmm I'm not sure if it's worth THIRTY dollars" "sir it was thirty-four ninety-five just last week and you're getting an amazing deal today at twenty-nine ninety-five" "hmmm thirty dollars hmmmmm"...
First time I've ever heard of it being an advantage to be the first to throw out a number. All other books and articles will say let them say the number first. after all, what if the number is lower than you thought (as buyer), or even better, you can bracket the negotiations. bracket: if they say $75 and you can pay $50, say $25. you'll end up close to $50 and they'll feel like they did great making you "pay more"
I feel like the precise price is subconsciously linking the thought of value which is usually handled with little scales instead of just thinking the "smaller scale"
As someone who worked way to long in retail.......I've already adjusted my mind to prices being virtually meaningless. Especially "sale" prices. I never believe anything is truly "on sale". In the case of supermarket goods it's much better to simply track the products you like to buy and you will quickly learn the store's lowest price that they will ever sell them for. Hell...next time your in the store, go to the customer service desk and get them to look up the product. Ask them if they can tell you the lowest sale price from a historical perspective. "what's the cheapest this thing sells for". Then just wait for the times they sell it at that price and stock up. It will usually be every few months. Most of the service people will probably just tell you the price. They don't really care. As for clothing, tech items etc.....It's more important to think in terms of life cycle. The older a product gets the cheaper it gets. You're not getting the new styles for any kind of deal. Decide how new you want your stuff to be and then pay accordingly.
Seems a heck of a lot more useful for the person making a sale, rather than a person seeking to buy something. I mean, you can't approach a car salesman on a lot and make the first offer. They already have a price in mind. Neither can you realistically say "my max budget is $397/month." Still, got my subscription. Expecting good stuff from you.
This makes sense. When bargaining for a lower deal (like buying a new car), you should probably adjust the anchor to about half of what you think the car's worth.
This is pretty fair and definitely worth watching however in the sales and retail world of today many won't budge...or budge enough off their price because they know that they have enough customers who will pay full retail and they don't need to give you a discount.
this is so relatable to my grades, gaining and losing marks . I would rather I get lower mark and gaining more marks than getting a high mark then losing marks
None of these marketing ploys have ever worked on me, it's just so obvious what they're trying to do. What really pisses me off, though, is that when a company decided to be forthright with their prices, business plummeted and they never fully recovered after that. People seem to be addicted to sales, even on fictitious comparatives, like those 90% off sales that only just put the true price anywhere close to a reasonable amount.
i got something fot 20 euro that was like 50 at first since i was in france and dont speak the language and the seller didnt speak english so he said (after haggling) 30 and we acted like we thought he said 20 so after a few attempts of him saying 30 he just gave up and sold it for 20 :-P
That's a common practice. Like fenrirgg said, chances are you still overpaid by a considerable amount, you just didn't overpay by as much as they wanted. Haggling remains a common cultural practice in some parts of the world and you have to know how much something costs in order to effectively haggle. I remember from my time in China that the correct answer was usually about half what they were asking. So, I'd usually start at about a quarter of the asking price. Unfortunately, with haggling you don't really know what sort of a deal you've gotten until after you've paid your money. Seeing a sour look on their face is usually a good sign, seeing them be friendly and happy afterwards isn't. If you're buying more than one thing, it's usually best to just haggle for the first item and then make other vendors go for it. The real skill here is pretending that you don't want it and being willing to walk away completely empty handed if they won't meet your price. Which is why some parts of the world have a rule against walking away from a deal that's in progress.
Here's one for you, there are three golden words that you can use to help you get a bargain when you approach someone with something for sale. I don't profess to know exactly why they work but boy do they!. I have used them to knock off 50% off the price I paid for several things that were already a bargain. Decide what you want to pay (say $100.00) and then just ask 'Would you take $100.00?' For some reason people just feel compelled to say yes!. Good luck, hope you are as successful with it as I am!!!!.
I believe marketing works or they wouldn't do it. It does not work on the cynical. I'm naturally a cynic, which is sometimes a bad trait. However, I have never been exploited or taken advantage of financially. I believe all businesses are corrupt and dishonest. When a deal actually occurs, I'm shocked. Businesses never take a loss or they be around for long. The last deal I made on a new vehicle was 22,500 on a msrp of 33,000. The same dealer was selling used vehicle with 30k miles for more. Did the dealer take a loss, No, he still made money.
These have been the best videos I seen since God himself facetime me, didnt last long as I hung up, knowing he saw me do...EVERYTHING dirty in my life.
Well the first one is that prices is a big factor in how you perceive the value of a product. The higher price communicates a high quality product, wheras the lower price communicates the perceived negative value. Hence you perceive the value you get by the high price, but the value you lose (spending money) by the low price.
I've been dragged into this before. Buying a pair of $120 boat shoes marked down 40%, which knocks off "oh wow, these are only $72 now, gotta grab these, wow!" Just to look them up online a while later and see that most other stores regularly sold these at around $65, as a normal base price. I also read about how oftentimes a retailer will display two brands of essentially the same product, but price one wayyy higher than the other, knowing full well that the over-priced one won't well. But the over-priced one makes the reasonably priced one beside it look more palatable. Sleazy games that they like to play. I miss feudal Japan, where merchants were the bottom class . . .
They haven't seen Les Gold from American Jewellery and Loan (Hardcore Pawn). I think he's a great negotiator. He never offers a price first. He asks "what do you want for it?" The customer says e.g $200 He then says "what would you really take for it?" They say I gotta have $150. He then says "why/where did you come up with that price?" He then asks "what's the least you'll take for it?" They say I need $100. He hasn't mentioned a figure yet the customer often drops their price 2-3 times by themselves. He then offers whatever he likes, usually less then half the final figure offered by the customer. "I'll give you $40". They counter with $80. He settles on $45-50. Brilliant.
That is called propaganda or public relations also known as spin. Edward Bernays and his 1928 book called "Propaganda", Bernays wanted the USA government to use propaganda to make the USA people think and do what the USA government wanted them to do and think. Capitalism used this for the same reasons. No one is able to avoid being persuaded by propaganda.
Me too. I think that thing is unwanted garbage and I don't want that trash (Unless that was exactly what I was looking for, like a good pair of sneakers that are so rare nowadays).
In this case actually no. Let's do the math: The shop buys something for 100 $ and adds 150 %. That would be 150 $, 250 $ in total. Now, they reduce the price by 80 %. 80 % of 250 $ are 200 $. The end price would be only 50 $. They would get less than the 100 $ they paid for it.
my grandas friend owned a clothes shop and he coulnt sell trousers for £5 at the time, so someone told him to bump the price up to £20 and it sold within a day because people perceived it as being more desirable clothing
Target will put clearance stickers on things and Mark them down by $0.30. Currently they still put the original price on the tag, but I'm waiting for that to stop since knowing that they only marked something down by such a miniscule amount means that most people will put it back.
I've seen this in myself, the compulsion to use the first thing I see as a baseline value. However, it's more because I'm not sure of the values of the same thing, but elsewhere. When I am, this is much easier to avoid. However, when you are unsure of the value, it's hard to know it they're already giving a good deal, or if they're not giving a good deal at all. I've noticed that on black Friday, some of those deals aren't. Often, it feels like the "deal" price is what the normal price should be. I think they probably hike the price up shortly before Black Friday so that the savings on the item is nothing or perhaps a small percentage.
The thing about offering first is that you might accidentally offer a price higher than what the person might have offered had they offered first. What if im thinking of offering 5000 but the person would have started the offer at 4500. I immediately lose in this situation and we bargain to 5000.
if someone is selling you something and you offer to pay 5000, they won't try and get it down to 4500, they'll either take that or raise it. you don't lose anything since 5k was your original offer. if you started with a price that was higher than you're willing to pay, then that's just dumb.
Thought I'd learn something today but nah, I already knew all this, the really hard bargain is to make someone drive down the price past the point of offense, now that takes skill and courage
Micheals craft store Always does this and says items are on sale. If fact, they lost a lawsuit saying it was not a sale since they use it all the time... the opposite also works by raising the price and creating perceived value as with jewelry, vehicles and museum artifacts (art).
what I usually do is not buy right away. for example a 1952 American vintage reissue fender telecaster usually range 1500-2000$. I go to ebay, amazon, musiciansfriend, my local guitar stores and compare prices. I will search and search until I find the one that is the cheapest, then if I can haggle, I will. thats why I got one 52 avri tele for 750$. Hooray for me 😊👍
That technique closely ressemble a very common con artist trick of "Good/Bad ; Bad/Worse." It's ironically a trick that everybody now and have faced at least once in their life. Here's an example : imagine that your parents (either of them or both) wish you to meet a family member (like an uncle) that they like but you don't ; they want you to meet that person, you resolutely do not want to meet that person. Now to bypass your refusal they say something along the lines of "if you refuse to meet that uncle, we'll have no other choice than to go see both your aunts." The thing is *you hate your aunts even more than your uncle* - worst still or/and better yet, your parents too hate your aunts _and had absolutely no plan to see your aunts since the beginning_ . So why did they propose the alternative of seeing the aunts ? Because they knew that you would've never agreed for it and 100% would prefer to see your uncle over them. The essence of the trick is therefore simple : you have a situation where, in the mind of the person you wish to trick, you instigate the idea that a bad choice is better than a worse choice - when the bad choice was your aim all along. Because out of two detrimental choices, you'll always instinctively try to get the less detrimental one as nobody, in their right mind, would ever consider taking the worst choice.
imo the attraction of a discounted price isn't as worthless to the consumer as you suggest. it is only a "trick" if the markdown in price was a lie (e.g. if the price of the shoes was never $300). but if at all other times the shoes cost $300, and you have the chance to buy it for $150, you are not irrational for choosing to buy it.
Thought the video was going to be disappointing at first but then it went into pricing trickery which is very important. Most people in United States fail to notice the 9/10th on the side of the gas price. Ex: $1.85 & 9/10th which pretty much sums it up to $1.86. A trick all gas companies use
the example of shoes is not really about anchoring. the psychology is much clear there - you see a product priced 300 and then you get discount, thus you are buying a product for half price. Even if the initial price was 500, then you boight it for half - 250$, it is still would be more preferable than buying a pair of shoes for 150$ (without discount). you need to undestand what are comparing: in the video 150$ is not the same not because anchoring, but because overall purchasing value.
Something I find very useful is to downbid your first offer. Most people will offer something, hear the salesperson's offer, and then RAISE their offer to something close to it (compromising). Instead of doing that, LOWER your first offer! So, suppose that you want that $150 pair of shoes. Take this video's advice and offer first, and specifically. Say, $99. The salesperson will counter with something like $120. Now, here's the trick: instead of splitting the different ($110), make your next offer $89! What I've found is that nobody expects this at all; they'll immediately panic, and either accept your second offer immediately for fear it may go even lower, or give their own compromise which will be, surprise surprise, in between YOUR two offers, something like $95. They might quickly realize that they've made a mistake, but by then you'll already be shaking hands to seal the deal.
Depends on how invested the person is, but yeah I can see that being effective overall. My mother tried to use that on us as kids in Monopoly, and we were all pretty good at just walking away. Mostly I tend to be one that looks for hidden aspects that increase or decrease value. Buy stuff that is more valuable than most suspect, (in board games) sell stuff that has less value than others think. I don't do the latter in reality mostly because ethics.
I feel like this tactic is completely detectable, at least to me. There always seems to be some "sale" going on in every supermarket. What's especially suspicious is when they mark things down by 10 cents, that's how you know they're trying to get you onto a product. Of course, with bigger products like a game system, this trick is easier to fall for because you can "mark down" the game system by 100$ and it feels like you're getting an incredible deal.
He didn't mention you can use Google,Amazon, eBay where you can first check out prices globally and domestically. Even something is sale in a shop, it might not beat online. Some shops do make their money at the sale by setting their prices high normally, but yet again these shops are far from between when online price comparison are so easy, might work 10 yrs ago!
That first example sounds kinda like that thing infomercials always love to do when saying the price, where they say something like "So how much does this fantastic new thing you didn't know that you didn't need in your life cost? $1299? Nope! $999? Still a lot of money! No, this thing costs a fantastic 599 US dollars! That's right, just five hundred and ninety nine bucks! Just a fraction of the price of other similar products! Call 1-800-BUYCRAP and order your very own [product name] TODAY!".
Want to save on furniture? Go to store act interested in an item you want. Get to know the salesman, get the card. Find out when that salesperson works and say you'll be back. Go back at a later date when that salesperson is there, but this time take someone with you and tell that person that you just wanted to show your family member or whoever is with you. Leave. Wait a couple of days. Call the salesman, ask if you can go in for an estimate and perhaps a brochure. Go in again. Get the brochure and estimate and leave. Remember during all this act really interested in the item, like you're just inches away from diving in and buying it. Finally after a couple of days and even maybe a week, text or call the salesman and act defeated like you're bummed that you can't buy the item you want. Say an unexpected expense came up (family, medical..etc get creative.) Say, you're going to have to maybe hold off on that purchase for now and perhaps you'll go back in a month or two. How do I know this could work? Salesman called us back giving us some story about the item we wanted being discontinued and they knocked a $4,000 item down to $2,800. Discontinued my ass, they didn't want to let us slip through their fingers. LOL! It's worth a shot. Good luck 🍀👍🏼!
Kathmandu does this to a comical extent I tell ya. Honestly in NZ, they always have their gear way overpriced and then their regular sales always try to catch you off guard by saying "up to 80% off" and some other bs.
there is a local music shop near me that uses that trick on EVERYTHING. They show a really high price that is crossed out, and then shows the "sale" price, but that sale price is still even higher than when you find that item online, to make it seem like a good deal. very annoying
1:00 that's not what anchoring is, or at least not what I know anchoring to be. derren brown's (and PUA/illusionist) definition is something along the lines of: associating a thought/emotion with a perception to be able to... cause/sway the subject towards the thought/emotion when exposed to the perception. perception = touch of a certain spot, sound, smell, those are the most used, but probably "etc...", extending to whatever can be used, probably even whole short similar models of situations...(?) I will check your sources, I'd have written the first part even if i checked them first and found out I'm wrong, just as "I thought...", just to get it out of my system :-D great video nonetheless, just like all the others, I just found you about 30 minutes ago, watched your stuff all that time, subscribing now :)
+MidnightSt the same word used in one subject or context doesn't neceserraly mean the same thing in another context. To me in the summer, anchoring means making sure the boat doesn't move around while we're sleeping
Every language does that and i'm not retarded, so i'm aware of it. The difference here is that both of the meanings i'm talking about come from psychology
Another very effective strategy to use at tag/garage/sales and swap meets: have cash in hand, literally, when making an offer. "I'll go $20" and have the twenty in your hand. Works most every time.
This channel is a hidden gem
Ikr.
Definitelt.
True.
thanks, because of your comment I actually looked at the channel name and subd right away hahah
Me too! I think we just got psyched into subscribing.
What I learned from this video was the concept of making precise offers. I always thought that the point of pricing something at $3.99 was simply to fool people who don't look closely at numbers (my mom would look at that item and say "oh its only 3 dollars!")
What I learned from this video is that it also makes the offer more precise and subconsciously causes you to want to bargain on a much smaller scale. Lately I have been constantly going to job interviews to try and get a better paying job. I'll have to try this technique. Instead of asking for $13/hour I'll ask for $12.95. I can see how this would lead to a counteroffer like $12.50/hr when I may have otherwise been counter offered a flat $12/hr.
Thank you for the informative video!
Did you try that?? Can you share your experience?
In regards to the shoes and the $150...I had a friend's father no matter if something was 50% off say $100 he would look at at it as he spent $50 instead of saving $50. You didn't save anything, you spent and that is the bottom line
Smart man. He must have had some knowledge in economics.
I've always had the idea that companies just raise the price by 50% just so they can "discount" it by 50%.
Yes, so many places do this. Or everything is on sale.
I've heard of the the shoe pricing thing before refereed to as the "JcPenny's effect" how it got that name is at one point when they had just gotten a new ceo he wanted to do away with deceptive sales practices and be honest with what the prices are and why they are set where they are. So he had all the stores stop doing all the sales and discounts that weren't really for a limited time, or on any actual markdown. And only put out the best price on the item and that was it. His stores lost big to their competitors who everyone though where selling the same stuff for cheaper. but when they went to compare prices the other guys final price the one the customer actually pays, and their prices where the same, and in some cases they where actually cheaper but people still thought they where the more expensive option on everything. So they marked up all their stuff, so they could put on sales and other discounts to bring it back down to where it started from and they eventually got their sales back up once people got word of the new sales starting up again.
The JC Penney Effect.
Why humanity can't have nice things.
I've always, in my mind, ignored the weird prices. 3.99? FOUR bucks. 99cent? A DOLLAR.
I have this so ingrained that I've had people "correct" me, if we're discussing the price on something. eg. "What do you mean four dollars?.. It costs 3.99..."
I kinda thought the point of pricing things like that was to trick people into thinking they were spending less money than they actually are. Like, 29.99 vs 30$ ... 30 dollars sounds like quite a bit more money than some amount that resides somewhere within the twenties, right?
Exactly. I used to say stuff like this when I was 8 and people gave me confused looks as if I was talking nonsense. I see now that they were the ones who couldn't comprehend what I had noticed.
you guys are falling for the trick while thinking you are being smart about it. fail
Chris Ross You clearly didn't read our comments.
Same thing happened to me. People try to "correct" me, but really it's just rounding to the nearest whole number. I think prices are set like that because when something is priced at $30, it looks a lot more than $29.99 to a lot of people because $29.99 is in the 20's and $30 is in the 30's.
It's particularly amusing with gas prices, such as $2.859 per gallon. If you buy 10 gallons of gas, your total will be a whopping 1 cent less than $2.86 per gallon. Who do they think they are fooling?
And then i bought 50 copies of Bad Rats
Thought this was going to be a shit clickbait video but was actually super concise and informative
Yeah you're right, but this guys videos are usually pretty good.
This was surprinsingly VERY informative. Thanks! You're the real MVP
bite size behavioural economics
still psychology
short and sweet. good funsize video is a funsize good video.
This is how it usually goes with me:
- Am I gonna pay $150 for shoes? Nope.
End of story.
that means you're probably a guy lol. Girls and their shoes *rolls eyes*
danielsjohnson that's imho a mistake alot guys make. "i would never pay more then 100$" for shoes". And every year they have to buy a new pair, or even worse, they don't and run around with unhealthy shoes. Buy a pair for 450$ and they will last you years.....
You're not friends with any sneakerheads are you lol
danielsjohnson Mist guys i know would spend a lot on shoes. especially basketball shoes or cleats
Marcos Beni I'm curious. Where does your avatar originate from? It's clearly a political quiz result of sorts.
I'm really glad to see that for once a youtuber makes claims and backs it up with sources. Thank you very much and your channel is very interesting.
It's amazing how some people need this kind of information.
I think that last stock photo has probably never been used in any other context
Loving this channel, well formatted and informative. Keep them coming man!
The limit of 12 cans per customer is an example of artificial scarcity more so than anchoring. A better example of anchoring is suggested donations.
Anchor, offer first, be precise - best tip of the century! Well done guys
This channel is gonna hit the millions one day no doubt
Keep it up guys!
I do this for a living and when selling secondhand merchandise it never hurts to ask the buyer to "make an offer". Being a seller you can always have a minimum in mind. Simply say no if they don't reach it and counter offer above your minimum. If they offer more than the minimum either haggle the price up or accept. This video is geared more towards buyers who have a general understanding of the object in question.
But wouldn't this trick benefit business people more than consumers most of the time?
Most of the time yeah, but at some point in your life you are a business person - whether that's professionally as a job or you're just selling something at a carboot/garage sale. It's also good for noticing when these tricks are being used to help you avoid them.
Sadly you didn't explain the 29.95 properly. It's because it's a much bigger cognitive load to think about what round number this fractional number is close to, and people's "system 1" thinking takes a shortcut to what you hear ("TWENTY-NINE" in 29.95) and it FEELS like they are getting a WHOLE DOLLAR less than the completely different number "THIRTY" when in reality it's just FIVE CENTS less. Once I realised this marketing tactic, I always force myself to do "system 2" thinking and round the price up. There has been several instances where I talked to a sales person like this (to constantly remind myself AND others of this trick): "So it's thirty dollars huh", "sir, only twenty-nine ninety-five great offer today" (me louder) "hmm I'm not sure if it's worth THIRTY dollars" "sir it was thirty-four ninety-five just last week and you're getting an amazing deal today at twenty-nine ninety-five" "hmmm thirty dollars hmmmmm"...
First time I've ever heard of it being an advantage to be the first to throw out a number. All other books and articles will say let them say the number first. after all, what if the number is lower than you thought (as buyer), or even better, you can bracket the negotiations. bracket: if they say $75 and you can pay $50, say $25. you'll end up close to $50 and they'll feel like they did great making you "pay more"
The keyboard solo toward the end of the background music is fucking killer! Props to the under-appreciated producer.
How come i just found your channel? the soup example blew my mind away! Awesome work, subbed!
Great job man! Short and full or information.
Great channel, love the short videos and practical, easy to understand information. Subbed
Wonderful video, as expected :)
Thanks so much for you're support :)
+hkcute You know it's your, why even bother writing it *Sigh* it's a simple mistake, no need to make it a big deal
+nima khatari might not be the first language
SuperAwesome10101 The guy deleted his comment, this was meant to some other guy
*_Thanks, a very insightful video! :)_*
Excellent video about something I absolutely suck at.
i feel like such a smartass for always having done this
I feel like the precise price is subconsciously linking the thought of value which is usually handled with little scales instead of just thinking the "smaller scale"
just discovered this channel, and simple fell in love with it x) why did i discover it just now
This channel just anchored me. I subbed.
Excellent video! Well presented .. thanks!
Where was this channel when i was doing my business degree damnit...business students got it easy now
This is even more significant in court. The party that suggests a certain sentence first has an advantage. In many countries that's the prosecuter
As someone who worked way to long in retail.......I've already adjusted my mind to prices being virtually meaningless. Especially "sale" prices. I never believe anything is truly "on sale".
In the case of supermarket goods it's much better to simply track the products you like to buy and you will quickly learn the store's lowest price that they will ever sell them for.
Hell...next time your in the store, go to the customer service desk and get them to look up the product. Ask them if they can tell you the lowest sale price from a historical perspective. "what's the cheapest this thing sells for". Then just wait for the times they sell it at that price and stock up. It will usually be every few months. Most of the service people will probably just tell you the price. They don't really care.
As for clothing, tech items etc.....It's more important to think in terms of life cycle. The older a product gets the cheaper it gets. You're not getting the new styles for any kind of deal.
Decide how new you want your stuff to be and then pay accordingly.
Seems a heck of a lot more useful for the person making a sale, rather than a person seeking to buy something. I mean, you can't approach a car salesman on a lot and make the first offer. They already have a price in mind. Neither can you realistically say "my max budget is $397/month." Still, got my subscription. Expecting good stuff from you.
This makes sense. When bargaining for a lower deal (like buying a new car), you should probably adjust the anchor to about half of what you think the car's worth.
I ll use that in my future price negotiations with my customers. Many thanks.
This is pretty fair and definitely worth watching however in the sales and retail world of today many won't budge...or budge enough off their price because they know that they have enough customers who will pay full retail and they don't need to give you a discount.
this is so relatable to my grades, gaining and losing marks . I would rather I get lower mark and gaining more marks than getting a high mark then losing marks
Another great video :)
Thanks for you ongoing support mate :)
None of these marketing ploys have ever worked on me, it's just so obvious what they're trying to do.
What really pisses me off, though, is that when a company decided to be forthright with their prices, business plummeted and they never fully recovered after that.
People seem to be addicted to sales, even on fictitious comparatives, like those 90% off sales that only just put the true price anywhere close to a reasonable amount.
i got something fot 20 euro that was like 50 at first since i was in france and dont speak the language and the seller didnt speak english so he said (after haggling) 30 and we acted like we thought he said 20 so after a few attempts of him saying 30 he just gave up and sold it for 20 :-P
Joke's on you. That gypsy was anchoring you when the market on the other side of the street had the same thing for 3.50
That's a common practice.
Like fenrirgg said, chances are you still overpaid by a considerable amount, you just didn't overpay by as much as they wanted.
Haggling remains a common cultural practice in some parts of the world and you have to know how much something costs in order to effectively haggle. I remember from my time in China that the correct answer was usually about half what they were asking. So, I'd usually start at about a quarter of the asking price.
Unfortunately, with haggling you don't really know what sort of a deal you've gotten until after you've paid your money. Seeing a sour look on their face is usually a good sign, seeing them be friendly and happy afterwards isn't.
If you're buying more than one thing, it's usually best to just haggle for the first item and then make other vendors go for it.
The real skill here is pretending that you don't want it and being willing to walk away completely empty handed if they won't meet your price. Which is why some parts of the world have a rule against walking away from a deal that's in progress.
What sort of countries have laws against that? Seems a little unfair
Invisiblejihadi
I would like to know as well
Ricky if it wasn't for people like you, everything on the planet could be cheaper
I will keep this in mind for my first raise negotiation
Having been raised for somewhat of my life in India. Bargaining is ingrained in my mind. Like if you've learned to bargain in a foreign country.
Here's one for you, there are three golden words that you can use to help you get a bargain when you approach someone with something for sale. I don't profess to know exactly why they work but boy do they!. I have used them to knock off 50% off the price I paid for several things that were already a bargain. Decide what you want to pay (say $100.00) and then just ask 'Would you take $100.00?' For some reason people just feel compelled to say yes!. Good luck, hope you are as successful with it as I am!!!!.
like a tv is 2000 dollars. but its marked down to 1200. If you buy it, you didnt save 800 dollars. You spent 1200.
Especially when it was never actually a $2000 TV in the first place
David Mark like seeing those 29 cent sun drops in the 50 cent drink machine...
I believe marketing works or they wouldn't do it. It does not work on the cynical. I'm naturally a cynic, which is sometimes a bad trait. However, I have never been exploited or taken advantage of financially. I believe all businesses are corrupt and dishonest. When a deal actually occurs, I'm shocked. Businesses never take a loss or they be around for long. The last deal I made on a new vehicle was 22,500 on a msrp of 33,000. The same dealer was selling used vehicle with 30k miles for more. Did the dealer take a loss, No, he still made money.
These have been the best videos I seen since God himself facetime me, didnt last long as I hung up, knowing he saw me do...EVERYTHING dirty in my life.
Well the first one is that prices is a big factor in how you perceive the value of a product. The higher price communicates a high quality product, wheras the lower price communicates the perceived negative value. Hence you perceive the value you get by the high price, but the value you lose (spending money) by the low price.
excellent video, can't wait for the next one :3
I've been dragged into this before. Buying a pair of $120 boat shoes marked down 40%, which knocks off "oh wow, these are only $72 now, gotta grab these, wow!"
Just to look them up online a while later and see that most other stores regularly sold these at around $65, as a normal base price.
I also read about how oftentimes a retailer will display two brands of essentially the same product, but price one wayyy higher than the other, knowing full well that the over-priced one won't well. But the over-priced one makes the reasonably priced one beside it look more palatable.
Sleazy games that they like to play. I miss feudal Japan, where merchants were the bottom class . . .
They haven't seen Les Gold from American Jewellery and Loan (Hardcore Pawn).
I think he's a great negotiator.
He never offers a price first.
He asks "what do you want for it?"
The customer says e.g $200
He then says "what would you really take for it?"
They say I gotta have $150.
He then says "why/where did you come up with that price?"
He then asks "what's the least you'll take for it?"
They say I need $100.
He hasn't mentioned a figure yet the customer often drops their price 2-3 times by themselves.
He then offers whatever he likes, usually less then half the final figure offered by the customer. "I'll give you $40". They counter with $80. He settles on $45-50.
Brilliant.
some people hate lawyers
i dont trust marketers, they make you want things you never wouldve wanted...
That is called propaganda or public relations also known as spin. Edward Bernays and his 1928 book called "Propaganda", Bernays wanted the USA government to use propaganda to make the USA people think and do what the USA government wanted them to do and think.
Capitalism used this for the same reasons. No one is able to avoid being persuaded by propaganda.
Really enjoying the videos.. worth subscribing
Thank you kind stranger
It always makes me suspicious when there is a big price jump like 300 down to 150.
Me too. I think that thing is unwanted garbage and I don't want that trash (Unless that was exactly what I was looking for, like a good pair of sneakers that are so rare nowadays).
Retail markup is 150% or more. Which is why they can do 70-80% off sales, and still stay in business. Because they're still making money.
150 % isn't enough for 80-90 %. It has to be at least 800-900 %.
tomlxyz
Ah, you do realize that 150 is more than 80-90, don't you?
In this case actually no.
Let's do the math: The shop buys something for 100 $ and adds 150 %. That would be 150 $, 250 $ in total.
Now, they reduce the price by 80 %. 80 % of 250 $ are 200 $. The end price would be only 50 $. They would get less than the 100 $ they paid for it.
my grandas friend owned a clothes shop and he coulnt sell trousers for £5 at the time, so someone told him to bump the price up to £20 and it sold within a day because people perceived it as being more desirable clothing
Target will put clearance stickers on things and Mark them down by $0.30. Currently they still put the original price on the tag, but I'm waiting for that to stop since knowing that they only marked something down by such a miniscule amount means that most people will put it back.
Video starts at 2:14
I've seen this in myself, the compulsion to use the first thing I see as a baseline value.
However, it's more because I'm not sure of the values of the same thing, but elsewhere.
When I am, this is much easier to avoid.
However, when you are unsure of the value, it's hard to know it they're already giving a good deal, or if they're not giving a good deal at all.
I've noticed that on black Friday, some of those deals aren't. Often, it feels like the "deal" price is what the normal price should be.
I think they probably hike the price up shortly before Black Friday so that the savings on the item is nothing or perhaps a small percentage.
The thing about offering first is that you might accidentally offer a price higher than what the person might have offered had they offered first. What if im thinking of offering 5000 but the person would have started the offer at 4500. I immediately lose in this situation and we bargain to 5000.
I don't think even you understand what you just said.
that's why u gotta start super super low just in case
that's why u gotta start super low just in case
if someone is selling you something and you offer to pay 5000, they won't try and get it down to 4500, they'll either take that or raise it. you don't lose anything since 5k was your original offer. if you started with a price that was higher than you're willing to pay, then that's just dumb.
What? If you offer 5000 and he accepts, then that is what you pay. Are you REALLY sure you understand the concept of haggling?
Very helpful, thanks.
Thought I'd learn something today but nah, I already knew all this, the really hard bargain is to make someone drive down the price past the point of offense, now that takes skill and courage
I understand courage but what do you mean by skill ??
On black Friday a lot of places say their products are on sale 50% off, but Jack the price up so that you're actually only saving +/-15%
Thanks. I'm going apply this Warframe. I need that fucking plat
Micheals craft store Always does this and says items are on sale. If fact, they lost a lawsuit saying it was not a sale since they use it all the time... the opposite also works by raising the price and creating perceived value as with jewelry, vehicles and museum artifacts (art).
what I usually do is not buy right away. for example a 1952 American vintage reissue fender telecaster usually range 1500-2000$. I go to ebay, amazon, musiciansfriend, my local guitar stores and compare prices. I will search and search until I find the one that is the cheapest, then if I can haggle, I will. thats why I got one 52 avri tele for 750$. Hooray for me 😊👍
And in a capitalistic society we aren't teaching all this crap to our youngins in school because?
Because then there would be more people who are competent enough to haggle prices down and amass more money for themselves instead of the economy.
they wouldnt give a shit anyways cause their plan at 13 is to live at home forever
^u think all 13 year Olds are a bunch of selfish assholes? what a cynical thought pattern ur going through
because capitalism needs a stupid slave class.
You're so ignorant sir, I'm 13 and I'm not a compulsive shopper...
That technique closely ressemble a very common con artist trick of "Good/Bad ; Bad/Worse." It's ironically a trick that everybody now and have faced at least once in their life.
Here's an example : imagine that your parents (either of them or both) wish you to meet a family member (like an uncle) that they like but you don't ; they want you to meet that person, you resolutely do not want to meet that person. Now to bypass your refusal they say something along the lines of "if you refuse to meet that uncle, we'll have no other choice than to go see both your aunts." The thing is *you hate your aunts even more than your uncle* - worst still or/and better yet, your parents too hate your aunts _and had absolutely no plan to see your aunts since the beginning_ .
So why did they propose the alternative of seeing the aunts ? Because they knew that you would've never agreed for it and 100% would prefer to see your uncle over them.
The essence of the trick is therefore simple : you have a situation where, in the mind of the person you wish to trick, you instigate the idea that a bad choice is better than a worse choice - when the bad choice was your aim all along. Because out of two detrimental choices, you'll always instinctively try to get the less detrimental one as nobody, in their right mind, would ever consider taking the worst choice.
imo the attraction of a discounted price isn't as worthless to the consumer as you suggest. it is only a "trick" if the markdown in price was a lie (e.g. if the price of the shoes was never $300). but if at all other times the shoes cost $300, and you have the chance to buy it for $150, you are not irrational for choosing to buy it.
Thought the video was going to be disappointing at first but then it went into pricing trickery which is very important. Most people in United States fail to notice the 9/10th on the side of the gas price. Ex: $1.85 & 9/10th which pretty much sums it up to $1.86. A trick all gas companies use
very helpfull, makes a lot of sense. Make the first offer, always!
the example of shoes is not really about anchoring. the psychology is much clear there - you see a product priced 300 and then you get discount, thus you are buying a product for half price. Even if the initial price was 500, then you boight it for half - 250$, it is still would be more preferable than buying a pair of shoes for 150$ (without discount). you need to undestand what are comparing: in the video 150$ is not the same not because anchoring, but because overall purchasing value.
thanks for this video. does the same tactic apply when trying to negotiate salaries?
Wow it wasn't based in psuedo science. You got my attention.
Thank you!
Something I find very useful is to downbid your first offer. Most people will offer something, hear the salesperson's offer, and then RAISE their offer to something close to it (compromising). Instead of doing that, LOWER your first offer!
So, suppose that you want that $150 pair of shoes. Take this video's advice and offer first, and specifically. Say, $99. The salesperson will counter with something like $120. Now, here's the trick: instead of splitting the different ($110), make your next offer $89! What I've found is that nobody expects this at all; they'll immediately panic, and either accept your second offer immediately for fear it may go even lower, or give their own compromise which will be, surprise surprise, in between YOUR two offers, something like $95. They might quickly realize that they've made a mistake, but by then you'll already be shaking hands to seal the deal.
Depends on how invested the person is, but yeah I can see that being effective overall. My mother tried to use that on us as kids in Monopoly, and we were all pretty good at just walking away.
Mostly I tend to be one that looks for hidden aspects that increase or decrease value. Buy stuff that is more valuable than most suspect, (in board games) sell stuff that has less value than others think. I don't do the latter in reality mostly because ethics.
I feel like this tactic is completely detectable, at least to me. There always seems to be some "sale" going on in every supermarket. What's especially suspicious is when they mark things down by 10 cents, that's how you know they're trying to get you onto a product. Of course, with bigger products like a game system, this trick is easier to fall for because you can "mark down" the game system by 100$ and it feels like you're getting an incredible deal.
Well known, still great.
great video.
subscribed!!!
I never look at what the promotion says. just at the final price.
Hi there, great info! Any suggestions of books that dive a little deeper into these topics? Many thanks.
+Marcus Loh influence by robert cialdini
Prices are also marked a few cents below because in keeps you saying a lower amount. Subliminal marketing.
He didn't mention you can use Google,Amazon, eBay where you can first check out prices globally and domestically. Even something is sale in a shop, it might not beat online. Some shops do make their money at the sale by setting their prices high normally, but yet again these shops are far from between when online price comparison are so easy, might work 10 yrs ago!
That first example sounds kinda like that thing infomercials always love to do when saying the price, where they say something like "So how much does this fantastic new thing you didn't know that you didn't need in your life cost? $1299? Nope! $999? Still a lot of money! No, this thing costs a fantastic 599 US dollars! That's right, just five hundred and ninety nine bucks! Just a fraction of the price of other similar products! Call 1-800-BUYCRAP and order your very own [product name] TODAY!".
what's the music in the background? I really like it
The thing about comparing to the first bit of info reminds me of delta compression
Fantastic video
Want to save on furniture? Go to store act interested in an item you want. Get to know the salesman, get the card. Find out when that salesperson works and say you'll be back. Go back at a later date when that salesperson is there, but this time take someone with you and tell that person that you just wanted to show your family member or whoever is with you. Leave. Wait a couple of days. Call the salesman, ask if you can go in for an estimate and perhaps a brochure. Go in again. Get the brochure and estimate and leave. Remember during all this act really interested in the item, like you're just inches away from diving in and buying it. Finally after a couple of days and even maybe a week, text or call the salesman and act defeated like you're bummed that you can't buy the item you want. Say an unexpected expense came up (family, medical..etc get creative.) Say, you're going to have to maybe hold off on that purchase for now and perhaps you'll go back in a month or two. How do I know this could work? Salesman called us back giving us some story about the item we wanted being discontinued and they knocked a $4,000 item down to $2,800. Discontinued my ass, they didn't want to let us slip through their fingers. LOL! It's worth a shot. Good luck 🍀👍🏼!
just read 'influence' by Robert Cialdini, it explains this and a lot more
I'd say research whatever you're buying is actually worth is a good place to start
I used this tactic to buy my first two wives. Very efficient! :)
Thanks, good info
Kathmandu does this to a comical extent I tell ya. Honestly in NZ, they always have their gear way overpriced and then their regular sales always try to catch you off guard by saying "up to 80% off" and some other bs.
there is a local music shop near me that uses that trick on EVERYTHING. They show a really high price that is crossed out, and then shows the "sale" price, but that sale price is still even higher than when you find that item online, to make it seem like a good deal. very annoying
great video.
1:00 that's not what anchoring is, or at least not what I know anchoring to be. derren brown's (and PUA/illusionist) definition is something along the lines of: associating a thought/emotion with a perception to be able to... cause/sway the subject towards the thought/emotion when exposed to the perception.
perception = touch of a certain spot, sound, smell, those are the most used, but probably "etc...", extending to whatever can be used, probably even whole short similar models of situations...(?)
I will check your sources, I'd have written the first part even if i checked them first and found out I'm wrong, just as "I thought...", just to get it out of my system :-D
great video nonetheless, just like all the others, I just found you about 30 minutes ago, watched your stuff all that time, subscribing now :)
+MidnightSt the same word used in one subject or context doesn't neceserraly mean the same thing in another context.
To me in the summer, anchoring means making sure the boat doesn't move around while we're sleeping
Every language does that and i'm not retarded, so i'm aware of it. The difference here is that both of the meanings i'm talking about come from psychology
...thanks for your (i assume) well-intended response, and have a nice day :)
Nice, I knew about the fake discount
Another very effective strategy to use at tag/garage/sales and swap meets: have cash in hand, literally, when making an offer. "I'll go $20" and have the twenty in your hand. Works most every time.