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A
We suck at this.
B
Holy. So bad.
A
Holy crap. We suck at it.
B
It's fine. I recognized it three years later. We're going to solve the problem now, guys.
A
Well, guys, welcome back. I'm annoyed. Let me explain what just happened. Before we started recording this episode of Brain Driven Brands, Sarah told me the topic we're doing, which she usually doesn't do, but she said, hey, this episode is about this topic. Topic. Because it's our. Like, this topic was our best performing episode ever, reached the most people. We got the most positive feedback on questions about it.
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One of the best.
A
And we haven't revisited this topic in a year and a half. Sometimes I think I should be more involved in the scripting and planning of this show.
B
I mean, if you want to be sure you can take on this, that's fine. I usually prep like 30 minutes before.
A
No, I was gonna say. I love that. I don't. Thank you for that.
B
I will say that's better than we used to. I used to prep five minutes before we got on.
A
Yeah, we're getting better. We're a professional organization.
B
We're getting better. Today we are going to be talking about pricing psychology, which I think everybody will love, because again, this is our second highest performing episode. I think episode type. Our. Our first highest was interesting because it talked about ADA and how it is the reason why your ads tank, which I still agree with. I'm still going to die on that hill.
A
Okay, well, let me get. Let me get my price, my pricing spiel out here before you can tell me what we're talking about. None of you have tested a price since you launched your brand, and like, that bothers me.
B
Oh, okay.
A
I talked to so many brands that are like, well, we set our prices in 2018 and haven't really revisited it. And it's like, what are we doing? It's like one of the most impactful levers you can do is test prices and offers and test how you message into that price and offer. And like, it's just so crazy how many of us have said it and forget it. Meanwhile, like, grocery bills have gone up 3x in five years. And it's like, hey, we can. We can bump our prices up a little bit and no care. Like, yeah, I've got a lot on this, but I'll let you, the one who prepped, take it from here. What do we. What are we trying to figure out?
B
Pricing, guys. And here's the reason why. I've got lots of stuff studies to bring to you today. So if we have time. These episodes are going to be longer ones. So I'm kind of glad, honestly, because I love the deep dives on this. Okay, we're going to go through seven pricing psychology tricks that work even on smart people. And the reason why I framed it that way. Not that people are dumb and smart. I hate to put them into buckets. But when I say smart, I'm talking about people who know that you're trying to, like, manipulate or alter or influence them into buying something because they understand things like charm pricing. They understand that, like, 97 and 99 get me to buy things more. Like, they have base psychology knowledge. And interestingly enough, there's quite a lot of consumers out there that I would say understand that if something ends in 99 cents, I'm probably gonna buy it, because psychology. So this is going towards the consumers that honestly need a little bit more finessing with their pricing testing. So let's do it. Okay, so I want to open this,
A
by the way, on two came to mind immediately for me that I'm writing down. If you don't get get to these, I have two more.
B
Okay. Oh, I'm so excited. All right, I'll leave room for yours, because, again, I picked, like, a random couple's ones that I thought were really interesting. So I'll leave stuff for you. Okay. So I want to open with a study that kind of messed me up the first time that I read it, because it was very intense. Researchers gave people an energy drink, gave it to two cohorts. Each cohort was then supposed to solve a bunch of puzzles. One group paid full price for their drink. The other group got, like, the exact same drink just at a discount. So we got one that paid full price, one that was at a discount. Now, here was the interesting part about this. Everything was the same, but when they looked at how well these people actually went through the actual puzzles and completed them, the group that had the discount on the product solved fewer puzzles than the group that paid high price. Like the product.
A
Yeah.
B
This was Shave Carmen and Arielli in 2005. And it's so fascinating because it's all about the fact that, like, the discount actually affects how people perceive the product, not just what they think about the price.
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Your discount. And I'm telling this to my supplements and health and wellness clients right now. Your price is going to directly reflect your perceived effectiveness.
B
Effectiveness.
A
Yeah, that's exactly what this is saying here. Like, if an energy drink is four bucks, you're gonna be like, cool. This is fully loaded with caffeine if you're getting it for a deal, it doesn't feel like maybe it works that well. But like I've seen this now in different LTVs of supplements brands, like ones that are acquiring customers on 40 and 50% discounts have terrible LTV.
B
Yeah. Gosh. So this first one here is price placebo effect, which they've studied this in a couple different places. So it's not just energy drinks. They actually did this with painkillers as well. People thought that a painkiller that was full price did better than one that was marked down. Like it literally helps their headache faster. They felt it went away, like better, like whatever. Right. So the pill actually worked better.
A
This happens. This happens with whiskey too. And any high quality product in like the wine world and food. Like if you tell someone like, hey, I paid sixteen hundred dollars for this bottle of whiskey, they're like, whoa, that's so good. But put that same thing in front of them as part of like a blind test. They're probably not going to pick that one.
B
It's expectancy bias. People expect it to be high quality. It needs to taste good. It needs to be high price. If that's the case. So for DTC in here, any founders or anybody that is honestly leading the like the price testing, I don't know, task every single week. You cannot always be on sale. Please don't always be on sale. Do not run sales year round. Like it's illegal. Yes. And a discount can actually degrade the experience and cause people to churn because they got it on discount. So price. Okay, number two here. This is the, the nine ending paradox, which I find really interesting. So it's a field experiment.
A
I kind of hate this. For the record, I already don't believe this really works, but go ahead.
B
Okay. All right. All right. So this is just a fascinating study to me because that nine number has been around forever. People are like super obsessed with it attached to it. This study was done by Anderson in Semester, I think his last name is. In 2003, they sold the same item out of a catalog. One at $34 and $1 at $39. Same exact product, $39 1 the more expensive price sold about 24% more units at 39, 34. It doesn't really make any math sense, but 9 is interesting because it's just below any sort of just below. And I've seen this in a couple different studies. It's interesting. These just below numbers.
A
You know, it's interesting. We had a price test win where we were selling a bundle of our Jack Daniels watches. The control price was 6.99.
B
Okay.
A
We tested 777 because Jack is old number. And I was like, let's just try it. And triple seven one out.
B
That doesn't shock me, though, because it has connotation. It's got meaning. It meant something to the consumer because it was a part of Jack Daniels.
A
Yeah, we call it the old number seven bundle. It was $777.
B
See, that makes sense to me. And if you have that kind of lore in your business, you should 100% be testing it because it works. And that was a drastic increase in price. It wasn't like, bump it by 10.
A
Yeah, that's 78 bucks. I mean, that's a 12% bump on what it cost. And we sold more of them. We converted at a higher rate.
B
So caveat to this, and this is really interesting, nuance matters here. Like, we just showed this effect, though, that 9 is actually strongest on new items they found. And when a customer doesn't have a lot of info to go on. And it actually gets weaker if you match it with a sale, which I found really interesting. So don't end everything in nine forever. You got to be strategic about when you're using it and why.
A
Yeah, I like it.
B
Okay, this is going to be a weird one, and I'm so excited for this number three, the phonetic length effect. Have you heard of this one? This is super obscure.
A
I don't know what phonetic means. So.
B
Okay, so this is a really interesting study because it's super, super sneaky. Coulter, Choi, and Monroe in 2012, the number of syllables in a price changes how big it feels. Syllables. So take, for example, you got, let's say 15 and 99. If you write it as, like, 1599, comma, 0.0, right. Your brain is going to say 1,599.
A
Yeah.
B
And just having that in the brain, Having the brain having to say it makes it a bigger number. Like, it's just. It's automatically gonna think it's too big.
A
So I have. I have something coming out, by the way, that's gonna. Okay, a thousand dollars. And I'm gonna price it at a thousand dollars because. Because to me, like, 999. Yeah, it's like. It's too long.
B
Yes, yes, yes, yes.
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People know about.
B
It's. It's the weirdest effect I've ever seen because it has to do with how you're saying it linguistically, not what the number is.
A
A thousand bucks. It's a grand.
B
Yeah.
A
It's 1K.
B
Yeah. If you want the price to feel lighter in larger numbers, anything over a thousand, obviously you have to lose that comma and just let, let the, the phonetics, like, take over, basically. Interesting. Like a B test though, just to see. Humans are really weird numbers, like mess with our heads.
A
Yeah. 100.
B
Okay. Do you want to go do some of yours or I keep going with ours over here.
A
I've got one, I've got one that's come up in the last five years because I think we're like suffering from hyper inflation in the U.S. okay.
B
You think we are or are we.
A
Sorry. My bank account and credit card history confirms that we are.
B
I was like, I'm pretty sure we are.
A
The interest rate on my mortgage. No, I pain out here, people. Every brand I've been at, we've been able to raise prices successfully. And that's half because we get better at communicating the value of it. But I've been obsessed with this concept of like personal price anchors where, you know, the, the typical price anchor example is like, hey, at the movie theater, the large popcorn is 13 bucks, the medium's 12. So no one ever gets the medium because it's only a dollar more for the large.
B
Decoy effect. Yep.
A
But people don't just anchor your prices to other stuff they see on your website. They're anchoring it to like the last thing they bought on Amazon. They're anchoring it to their weekly grocery bill. And with some of my clients right now, we're seeing some interesting data where like, they do not sell the cheapest version of this thing. If they wanted to, they'd go on Amazon and get it for cheaper. So I, I, I think you have to be really aware of like, what other people, what customers are going to comp price to off of your website and make sure you're addressing that somewhere in your messaging or content or offer.
B
That's a really good one, actually. Like, what are they anchored to or what could you anchor to to make it easy for them? Ikea does this a lot. They ran a test, I can't remember exactly where they ran this. They put icons for the price where it was like, this table is worth four cups of Starbucks coffee. Or like this couch is worth like five pizzas.
A
Yeah. They'll do like, oh, for the cost of a cup of coffee a day. It's, and it's like, well, easy, like,
B
oh my God, Yes. I could say yes, that all day.
A
Yeah.
B
Because I love expensive coffee. Okay. This is an interesting one that actually applies right now. There's so many different ways we go with this one. So it's called the credit card premium. So how do you say this? Pre leck and semester in 2001. So this is an older study, but they've done a couple other ones that are newer. They specifically went and ran an auction for Celtics tickets. I guess.
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Celtics.
B
Celtics.
A
Celtics.
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How do you say it? I don't know. I don't follow anybody anywhere. Okay. The ra. Celtics tickets, half the bidders were told that they would pay with cash. Ah. Nate's totally rolling his eyes on me. I don't know, guys. I'm not a sports person. All right. Celtics, Celtics, Celtics, Celtics. Sure. Huh? Half the told that they would pay with cash. Half the bidders are told they were paying card. The card bidders bid almost twice as much for the same tickets. Now this is obvious. Like, a credit card doesn't feel like real money, right?
A
Yeah. This does not surprise me at all. This is why I think they're like, the people in charge of the world are trying to get us to a cashless place because they don't want us to understand how much money we're for.
B
They don't want it to feel like money.
A
Yeah.
B
This is happening everywhere, though, with like, save your credit card. Right, Right. So that next time you pay, it's easier on. On Amazon, they have like one click payments. Right. Where you don't have to do anything. Yeah.
A
Buying things on Amazon does not feel like giving away money.
B
Yeah, yeah.
A
It. It never has. Oh, it's just like, no, I want that to come here.
B
They noticed it very quickly early on in their journey, and all of us are kind of already on this. But now something that's interesting is happening in retail is you have tap to pay. Right. Tap to pay is even more so.
A
Yeah. You don't even have to take out your wallet.
B
You don't even have to move the money receptor. I'm like, this is insanity. So for D2C, this isn't, as, I think, critical for now because we have our credit cards typically loaded in some particular capacity. But if you're a brand new customer and you have to get your credit card out and type that credit card in, it's a barrier because you understand money is about to leave my pocket.
A
Yeah. Like when I check out on a store that has shop pay and I just, like one test, tap it. I'm good. That doesn't feel like buying things.
B
It does that. Which is scary if you think about it, because like, how many other things are we doing? Because it doesn't feel like effort.
A
A lot.
B
Okay, next one on here. I think we have two more, actually. So this one's interesting. Partitioned pricing. If you split the total, it will shrink. You split the total, it will shrink. So this is. Oh, my God, I'm going to butcher his last name. Hossein. I think his last name is Hussain. And Morgan ran this on eBay in 2006. They saw the same CD two different ways. One listing was for $4 with free shipping. The other was $0.01 plus 3.99 in shipping, which is $4.
A
That's pretty good. I like that.
B
Exact same total.
A
I like that a lot.
B
But the penny plus shipping version pulled more bidders and made around 25% more money.
A
Yeah, yeah, we had Easy. I ran a free plus shipping offer a while ago a couple brands ago on a, like, novelty shot glass. And I think we said 9.99 was like, the shipping cost, but, like, we made money on it. They were doing some hacky stuff.
B
I don't love it. I don't love that. Hacky.
A
Yeah.
B
But I appreciate the psychological effort, I find.
A
Yeah, but like. And like, we did test it the other way. We said, what if we just sold it for 10 bucks instead of shipping was free. It didn't work. So this 100% works. I've seen it happen.
B
That's so crazy. One, this is. And this has to do with mental accounting, right? So, like, your brain is going to open two separate folders and say, okay, that one's a cent, but that one's for. That one's cheaper. It's not going to sit there and go, wait a minute, isn't this just $4? I have, like, rage quit over shipping fees. I hate them. I find them to be very ridiculous.
A
I think this is like a gene mutation, by the way, because every consumer I've ever talked to is either, like, I hate paying for. For shipping. It causes me to abandon cart all the time.
B
Yes.
A
And then me, like, I've never once looked at what shipping costs. Oh. Because I'm just like, where I want the thing. So I don't.
B
I was gonna say, technically speaking, I should not be upset about it because paying for shipping should tell the brain that I'm actually paying for it to be carefully handled and brought to my door.
A
Well, that's not true.
B
What it should. But then Amazon broke that, so thanks, Amazon. That's not what it is.
A
I think Amazon takes better care of stuff than FedEx or UPS. Or USPS.
B
I mean. Yeah, the pulse system.
A
No, but I think this is like a. Like, I don't know. Yeah, this is like a thing like. And I would test it at your brand because, like. Yeah, because, like, I. I've seen brands where their customers are very motivated by it and, like, they'll spend an extra, you know, 20 bucks just to unlock the free shipping threshold, which was less than 20 bucks, by the way. And then I've seen brands where, like, the shipping cost had no effect on anything and we were actually able to increase the price of shipping.
B
Yeah.
A
So, yeah, test it. Because I think, like, different people feel very strongly in opposite directions of this.
B
Yep. Yeah.
A
For me, I've never once checked the shipping price. I think that's insane.
B
Especially if you can make your product seem like it's pretty cheap and then just be like, hey, but I. This doesn't work for everything. I don't. I don't know that it would work for products that are higher price. Like, I don't think you can say a 50 product has been dropped to a dollar, but we're going to charge you 49.
A
No, definitely not.
B
People are going to be like, what? That's make it make sense.
A
But, like, cheap stuff. You could.
B
Cheap stuff. Yeah.
A
I should test that with hats because shipping cost me like, six bucks. I should test either selling them for 40 bucks and say shipping's free, or selling them for 34 and saying shipping. I sure should do that. I'm going. Right.
B
Will you run that test for me this week and see what happens? Because that'd be so interesting. All of these stupid tests that we keep saying we're going to run and then we never do got to run.
A
Well, we're back in inventory over@sho.com. so we're back. Sales are up again. Life's good. So I can, like, do stuff again. I've been sold out for 65 days, so I've been.
B
I cannot win.
A
Like, purgatory.
B
Okay, well, that's what I should do, though. Yes. Go test and then tell us. Come back next week. I'll try and remember. I'm sorry, I apologize to our fans. Like, I forget to ask you constantly if you ran that test. I will put a note.
A
And also I'm going to tell you I'm not going to do it next week because next week slammed. But what we have then some week.
B
Look, John, okay, last one on here,
A
by the way, going back to our last episode about biases and everything. Shouldn't double ripping right now. I'm not going to touch a thing until it stops.
B
That's what I'm saying is don't touch it. Like, don't touch it. Just stop messing with.
A
Yeah. We're going to have. I can already tell July is going to be our biggest and most profitable month ever. And it's going to be great. Yeah.
B
Oh, I can't wait to see where this brand is. Not even like three to six months. It's going to be like, have I
A
told you what I'm doing, by the way? I have a little sneaky, sneaky secret thing.
B
Okay, I'm ready. Oh, okay. I'm ready. The endowed progress effect is the last one on here. If you give people a head start, they will much more likely to finish. So this, obviously, this is gold grading effect. We talked about this on a couple different episodes. Nuns. And how do you say your last name? I'm so sorry. Dre. Dre. In 2006, then a car wash hand out loyalty cards. Group A got a card that needed 10 stamps, but two were already stamped for them. And group B got a card that needed eight stamps, but they were all blank. Both groups would have to buy eight washes. Right? It's identical effort, identical reward. Completion rate was 34% for the Head Start group and 19 for the Blank group. Yeah, nearly double because some stamps were already stamped.
A
I got sold on something this week that I was not planning on buying, but I got a message from the brand that said, like, hey, if you buy, the basic model will upgrade you to the premium version of it. And I bought it immediately. And then as soon as I did it, I was like, I just got got. Like, I just completely got got. But it made me feel like I was getting so much more. And I felt like I was like, oh, like, I'm already halfway to this, like, special thing. This a good one.
B
I think this is the reason why hotels upgrade random people at random times. And I used to work in a hotel ages ago. I worked for the Renaissance brand. I was at the front desk.
A
Those are so right.
B
Yeah, it's a decent brand. I mean, it's, you know, or I'm poor.
A
I don't know. Okay, whatever.
B
It's a hotel. Anyways. Renaissance brand used to be at the front desk. Interestingly enough. We would, like, randomly pick probably about 10 people to just upgrade for the day. That was a part of our task, is to randomly upgrade people. And we would always upgrade them to something that was, like, a little bit nicer, but not all the way nicer.
A
So it was they bought it the next time.
B
Yes. So next time they'd have a higher chance to buy up. So. And this is kind of what they're talking about is like upgrading people or getting them closer to like the next thing. That's technically not goal gradient, but it's a good example of like another good test. That is the seven that I have today. Price test for everybody. These are the weird ones, not just the normal, like trends. 99 cents. I think all of these could be interesting things to test this week.
A
So all of these could be relevant to you. I think the most important thing is, like, you should just think about your pricing strategy because I know it's something you haven't thought of in a year. So think about it for the weekend and come back on Monday and do something good.
B
Oh. Or don't test any of these and then Nate and I will go make a lot of money with them. That's all. Still.
A
Oh, we're going to make a lot of money either way and that's why you listen to Brandon Brands. Follow us at Nate Legos and at Sarah Levinger on Twitter. Hit us up if you want to work with us and we'll see you next time.
B
Thank you so much for joining us on the show today. Appreciate you guys listening. If you want to follow me, I'm Sarah Levenger. Anywhere you consume content, he is Nate Lagos. If you like this show and if you like this episode, go ahead and like, subscribe, share with a friend. Drop us a review when you have a minute. We would appreciate it. Otherwise, have a great week. We'll see you next time.
Host: Sarah Levinger
Date: July 16, 2026
In this engaging episode, Sarah Levinger dives into seven advanced pricing psychology strategies—used by some of the world’s biggest brands—that still work, even on informed, “smart” shoppers. Drawing on research studies and real-world examples, Sarah and her co-host (Nate Lagos) break down how neuromarketing can help e-commerce brands refine their pricing models to maximize perception of value, conversion rates, and long-term customer success. The conversation aims to demystify tactics that go far beyond charm pricing or “.99” endings, providing listeners with actionable ideas and the underlying science to support them.
The energetic, conversational nature of the show ensures practical experimentation is always front and center, with a recurring emphasis: the only way to know what really works for your brand is to test, analyze, and stay curious about the brain behind the buy button.