🚨 You’ve Been Framed

Every time you buy something you are being framed.

Whether it’s Starbucks pushing you to buy their most expensive drink…

Or Tesla trying to sell its new model…

87% of the time, you will buy the one they want you to choose.

Why?

Because these companies have mastered the art of price framing.

AKA painting a picture around their pricing that makes their preferred option seem like a steal.

Today, I’ll show you how 3 major companies use framing to make you buy what they want.

Here’s what we got for ya:

• 🏆 Premium Pricing

• 🚗 Dynamic Pricing

• 🍏 Convenience Pricing

Read Time: 4 min 58 sec

🏆 Premium Pricing

There’s a famous study where researchers blindfolded 140 people and asked them to rate 3 wines based on quality.

What they didn’t tell them was that the 3 wines were the same wine, just in different bottles.

Before giving each taster the wine, they gave them a fake price of either $10, $25, or $70.

96% of the testers said the $70 wine tasted the best… even though they were all the same wine.

This is the power of premium pricing.

Higher price = higher value = higher status

However, this tends to only work for luxury products that are naturally high value like watches, wine, shoes, etc.

This is because people expect to pay the highest market price anyway.

(Click here to read “The Secret To Building A Luxury Brand”)

So what about non-luxury products?

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🚗 Dynamic Pricing

Starbucks offers 3 main sizes:

Notice how the middle option is closer in price to the most expensive drink.

This is on purpose.

Without a middle option, most would choose the cheapest option. It’s hard to justify paying $3 extra for a large.

But if you have an ‘average’ option to bridge the gap, the large is suddenly a better deal.

We also see this framing method with Tesla.

Here’s a price comparison of the Model 3:

Notice that the middle option is cheaper than the top option, but offers the most miles.

Why?

Tesla wants buyers to choose the middle option.

The Model 3 is always priced at the average price of a new car in the US. AKA a lot cheaper than most electric cars.

Tesla uses the Model 3 to attract more buyers. Then they use this framing method to push them toward a more expensive option.

Takeaway: Move your medium closer to whichever option you want to sell the most of.

🍏 Convenience Pricing

60% of people who own an Apple device, also own 4 other Apple devices.

It usually goes something like this:

iPhone → Macbook → iPad → Apple pencil for notes → cont.

This is called the “Apple Ecosystem” - a web of connected electronics.

Now, Apple can convince buyers to pay 5x the price because once you’re in the ecosystem, it’s more convenient to stay within it.

Apple does this in 3 ways:

#1 - Software

With Apple products, you have access to Apple Music, Facetime, the iOS AppStore, etc.

So if you ever leave the ecosystem, you’ll lose access to their digital software as well.

#2 - Satellite products

EX - Apple Pen, Apple Watch, chargers, etc.

Why buy a Fitbit when you could pay $400 extra for an Apple watch that acts as an iPhone on your wrist?

Plus, as soon as you leave the ecosystem every satellite product you have loses its value.

#3 - AppleCare

Apple gives you the option to insure your devices. You can insure one, or save money and insure all of them.

So once you pay for AppleCare, it’s easier to buy another Apple device to add to your plan than it is to buy outside of the ecosystem and find another insurance.

Remember, people will always pay to save time, money, and effort.

Frame your price in a way that does all three, and you can charge whatever you want.