See Things Differently
Could a simple change in pricing strategy increase album sales?
I read an interesting experiment in ‘Predictably Irrational’, a new book by Dan Ariely. It runs like this:
A real advert in The Economist magazine promoting annual subscriptions offered three pricing levels, and in an experiment 100 students were asked which one they would choose (answers in brackets).
Obviously no-one chose option 2 since the addition of the Internet version in option 3 was perceived as ‘Free’. However, crucially, option 2 provided an important psychological ‘decoy’, as evidenced when the experiment was repeated without it.
Now, people chose the cheapest option while the print version was simply considered as more expensive without a significant enough perceived benefit.
It strikes me album pricing could benefit from following a similar path. How often have you seen this offer for an album?
Why not price albums as follows?
Since the additional cost of allowing people to download the album is minimal (the cost of the bandwidth) then by using the physical album as a decoy, retailers may push more people towards buying the physical album since they perceive the download as ‘Free’. despite the fact they can naturally rip the album as soon as they receive it.