Charge $0 Instead of Saying Free

In my retailer workshops about pricing, I’ll usually include a classic consumer psychology finding that if a product is offered for free in a promotion, the shopper becomes less likely to buy the product at full price afterwards. Researchers explained this by saying that when getting it at no charge, consumers conclude consciously or subconsciously the product must be of low quality.
     Frequently, one of the participants in the workshop will reply, “If that’s true, why do so many marketers keep using ‘Buy One, Get One Free’ promotions?” My flippant answer is, “Because they’ve not been smart enough to take my advice.”
     But I’ll than follow this with the more accurate answer that consumers have a complicated relationship with zero. The positive feelings about getting a free item can increase sales, but the way in which the offer is presented influences the degree of positivity.
     More recent research results, from Korea University and Pukyong National University, recommend using “Get it for $0” rather than “Get it for free.” Here, the researchers’ explanation is that the $0 phrasing does a better job of drawing attention to the cost savings.
     Supporting this explanation is that the difference between the two phrasings was greater for shoppers who are highly price-sensitive and when purchasing an item for oneself rather than as a gift for someone else. If you don’t pay much attention to price, the cost-savings means less, and to preserve the emotional value of a gift, we might actually resist high attention to saving money.
     As to why the $0 phrasing does a better job of drawing the focus, other research suggests to me it might be because that format is unusual. Consumers see the “free” phrasing much more often in promotional offers such as BOGO and gift cards.
     Statements using unexpected units increase the consumer’s interest in understanding reasons to make the purchase and distract the consumer from thinking of reasons not to buy. Researchers at University of Cincinnati, University of Indiana, and University of Twente told study participants that a candy bar would cost 100 cents, membership in a student interest group would cost 300 cents, and a tuition increase of 7500 cents was slated.
     The participants given this information, rather than the amounts in more conventional dollar figures, became increasingly anxious to make a purchase decision and increasingly certain of any positive judgments of the product, activity, or cost.

Successfully influence the most prosperous & most loyal consumer age group. For the specific strategies & tactics you need, click here.

Click for more…

Give Shoppers a Comparison Point 

Label Freebies as Samples 

Go for BOGO Free Over BOGO Discounted