How you set the pricing of your products and services will heavily impact the perceived quality people have of what you offer.

Many businesses try to be the cheapest to try to generate more sales, however often this can actually have the reverse effect, it can create a perception of low quality and actually lead to less sales than you would have generated if you charged more.

We often work with businesses and assist them to increase their prices (we recommend adding more value to your customers if you‘re going to increase prices, so it‘s not just about making more money for you, but they win also), and as a result of the price increase, we very often see an increase in sales at the same time.


Christo: Today I want to share a little tip with you around positioning. Because oftentimes people think that lower cost is going to sell more and a pretty common mistake actually that we see, a lot of business owners make when they come to us, they are always trying to charge as little as possible to try and generate more sales. Now, there are a lot of triggered responses that humans tend to have, in terms of psychology involved behind marketing and how we operate, there are other perceptions we have around things which basically help us make a decision quickly in a certain situation. So for example, expensive often we automatically think it means valuable, rather than, which is often what people are looking for when they‘re looking to purchase something; they‘re actually looking for something really valuable, or high-end or quality, whereas lowcost often means cheap. But as a business owner, we often push things to be as low-cost as possible to sell as much as possible. There‘s this great example in a book called, “Influence: The Psychology of Persuasion” where it‘s a story of a jewelry shop owner and the jewelry shop owner just can‘t get rid of these certain products, these green jewelry, and it won‘t move. There are lots of customers, it‘s apparently the busiest season, it‘s like tourist peak season, and there are a lot of people coming through the store. But this certain product just won‘t sell. So the business owner, on one of the afternoons leaves a note for her team member who‘ll be in the morning, and says, “All items in this cabinet – Half Price” and what happened is, the team member came in and misread the note. They read the note, “All items in here are 2..” they just saw the 2, they didn‘t see the top of the half, so they doubled the price of all the items in this certain cabinet and then sold everything else. So when the business owner came back a couple of days later, all of those products had been sold out, and thought excellent, great job for marking it down, and selling it off cheaper. But in fact, what had happened is as the customers had come into the store, they‘d seen these items, they wanted a valuable item, I guess to maybe take home from their holiday, as a nice piece of jewelry, and with the price being higher, they actually sold out. So it moved the product off the shelf. Now, this is relating to triggered perceptions, this kind of triggered response, if things are high-priced items, they must be good quality, basically. So just keeping this in mind, because we see it often, over and over again, the people that are concerned purely about the price and trying to make it cheaper, cheaper, cheaper, but in fact, it could be potentially damaging your sales by going lower cost as well. There‘s a great example of an experiment in Australia that Best-and-Less store did as well. Best-and-Less is known as low-cost, quality kind of store, but low-end, like low-cost. What they did is they created a pop-up shop called, “LAB” – L and B, which was sort of Best and Less, they switched it around: L and B, and they created LAB with nice high-end looking bags and quality-looking displays and everything, and instead of the items being maybe $40, they put $140, and they put all the prices right up, and people were coming in buying the same products which they actually sell for $40, however, when they were about to purchase, they didn‘t actually sell them. They ripped the price tag, ripped the hundred part, the 1 off the front of the price tag and they‘d be left with $40 and is basically a demonstration to show that they sell quality products which people typically pay a lot more for. But the cool thing to see is, the interesting thing is, people actually flocked in to buy the same products at a higher price but they‘re actually the same thing. So just keeping in mind that your pricing could be impacting you in a positive or negative way. And it‘s a common question that we have, so just wanted to throw this tip at you today, something to think about. If you have any questions about this, any concerns, any thoughts, feel free to email through the Basic Bananas or comment on any of our social media platforms and we‘ll look after you there. Otherwise, hopefully, I will see you soon!