Psycological Pricing

This article talk about the psycological pricingthat customers take into consideration. They are trying to think in the eyes of their customers. Trying to figure out what they think when they are buying something. The firstthing thatthey talk is pricing positioning. When a business putsout a new product, they need to think about what the price should be. Obviously they need to make a profit, but they want to price it lower than their competitors because people will gravitate toward the lower of the two products. If you price just a little above the market average, then this will tell the customers that their is a little more quality in the product. This relates to premium pricing from our text book (even though premium pricing is about a product line). The next thing that they talk about is "popular pricing points." This is a common price that most people will have on them. The example that they give in the article is something that is priced under $20 because a $20 bill is the most common bill that people carry about on them. Since its under $20, then people are more likely to buy it because they can afford it right now. Just like the dollor menu, people usually have at least a few dollars on them. This allows them to buy a meal. The last thing thatthey consider is fair pricing. This is mostly when a business puts out a product and they don't have any competitors. This makes it so that they aren't going to charge a ridiculous price because it is the only one out there. This still makes it "fair" for the customers because nobody is going to buy something when they know that is way over priced.
     I feel as though positioning pricing is the one that people putting out the product consider the most. They might be unsure of what they charge for their product so they might do some reasearch and find out what other businesses charge and go from their. This allows them to be "with" the competition, "lower" or "higher" than the competition. This will give them a leg up because if it is lower, then people are more likely to go for the cheaper one. If it is higher, then people might think that have more quality.

Which one do you think people consider the most?