There’s a science to pricing your product. No question about that. But most people join the race to the bottom, lowering their prices and competing on cost, when many should be considering raising their prices.
Now a new scientific study, “Marketing Actions Can Modulate Neural Representations of Experienced Pleasantness,” published in the prestigious (but poorly acronym’d) Proceedings of the National Academy of Science, says something marketers have longed to hear:
“If we believe the wine cost more, we truly believe it tastes better.”
Here’s what the researchers did. They gave 20 volunteers 5 sips of wine each. They told the volunteers the “price” of the wine and then measured the response of the pleasure centers in the brain.
The brain responded more favorably to the “higher priced” wine, even though each sip of the wine was the exact same Cabernet Sauvignon.
There are many anecdotal stories of increased prices correlating with increased perception of the value of the product. But this is the first study I’ve ever seen that shows the brain actually responding more favorable to the perceived luxury. As you can imagine, it’s getting lots of coverage.
This study is the latest (and perhaps most compelling) reason I’ve seen to re-evaluate how you sell, and what perception you trigger in someone’s brain when you’re willing to discount your services.
What do you think?