Price Anchoring, Or Why a $499 iPad Seems Inexpensive
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Re: Price Anchoring, Or Why a $499 iPad Seems Inexpensive
#2That does not seem inexpensive when you take into account what you actually get.
Re: Price Anchoring, Or Why a $499 iPad Seems Inexpensive
#3Now, if you’ll excuse me, I need to go shopping. I’m out of cereal, and—what? Cap’n Crunch is $2 off? Better make it two boxes.
I seriously bought two boxes of Captain Crunch last week because they were on sale. Now I am stuck much more sugar than I can handle. Ugh.
Re: Price Anchoring, Or Why a $499 iPad Seems Inexpensive
#4I agree with the premise, that the iPad seems inexpensive because of anchoring, but I completely disagree with the analysis, that the keynote presentation where the $999 is "crushed" by $499 had anything to do with it.
Fundamentally, people expect the iPad to be expensive because the iPhone was very expensive. Because Macbook Pros are very expensive, and because Macbook Airs are very expensive. Because Apple DVI connectors are expensive, because iPhone headset replacements are expensive. Because basically, everything with an Apple logo costs an arm and a leg.
So when you hear that you can get an iPad for less than twice the cost of an iPod touch then of course, that seems like a really good deal. (And only $100 more than a high-capacity iPod touch.)
The foldable iPad case $40 + keyboard dock $70 + spare charging cable $30 = $140. That's 30% of the iPad right there. So relative to all other Apple products and relative to its accessories an iPad for $500 looks like a steal.
Re: Price Anchoring, Or Why a $499 iPad Seems Inexpensive
#5Now, if you’ll excuse me, I need to go shopping. I’m out of cereal, and—what? Cap’n Crunch is $2 off? Better make it two boxes. I seriously bought two boxes of Captain Crunch last week because they were on sale. Now I am stuck much more sugar than I can handle. Ugh.
Just throw them away, dude. You shouldn't be eating that stuff.
Watch this: http://www.uctv.tv/search-details.aspx?showID=16717
Re: Price Anchoring, Or Why a $499 iPad Seems Inexpensive
#6Dan Ariely gives a related TED talk: "Are we in control of our own decisions?"
http://www.ted.com/talks/dan_ariely_asks_are_we_in_control_o...
Look around 11:30 for a few examples of how comparing options affects us more than looking at each individually.
On a side note, it also seems inexpensive because it's $499 and not $500! Psychological pricing is one of my larger pet peeves...
Re: Price Anchoring, Or Why a $499 iPad Seems Inexpensive
#7This works the other direction, too -- adding features without changing the initially-quoted price.
That's often the tag on infomercials: after they set you up for the cheez-o-matic for such-and-such price, they "also throw in a free" mini-cheez-o-matic.
Or you get a year of free support, or the 3 megabit connect for the 1.5 megabit price, or some other "added features" that make you feel like you're getting a deal even if you're really not.
Re: Price Anchoring, Or Why a $499 iPad Seems Inexpensive
#8I believe the famous paper he is speaking of in relation to asking for more and getting more is:
http://www3.interscience.wiley.com/journal/21451/abstract
Re: Price Anchoring, Or Why a $499 iPad Seems Inexpensive
#9Dan Ariely gives a related TED talk: "Are we in control of our own decisions?" http://www.ted.com/talks/dan_ariely_asks_are_we_in_control_o... Look around 11:30 for a few examples of how comparing options affects us more than looking at each individually. On a side note, it also seems inexpensive because it's $499 and not $500! Psychological pricing is one of my larger pet peeves...
On a side note, it also seems inexpensive because it's $499 and not $500! Psychological pricing is one of my larger pet peeves...
Ditto. That's why I round up when somebody asks me how much something costs. The mathematical error resulting from using $500 instead of $499 is much less than the psychological error induced by the smaller first digit.
Re: Price Anchoring, Or Why a $499 iPad Seems Inexpensive
#10Now, if you’ll excuse me, I need to go shopping. I’m out of cereal, and—what? Cap’n Crunch is $2 off? Better make it two boxes. I seriously bought two boxes of Captain Crunch last week because they were on sale. Now I am stuck much more sugar than I can handle. Ugh.
Just throw them away, dude. You shouldn't be eating that stuff. Watch this: http://www.uctv.tv/search-details.aspx?showID=16717
Good news! During the 90 minute video you will burn 100 calories, which is right at one serving of Captain Crunch, if you eat it without milk.
The video is also on youtube at http://www.youtube.com/watch?v=dBnniua6-oM if you have a better youtube player than their little flash thinger.