Why you can pay $499 for an iPad and feel good about it

by Carl Natale on August 20, 2010

Just in case you don’t know how an anchor affects your prices, you need to read this explanation:

“Any time you have to estimate a numerical value, it turns out you’re very susceptible to the power of suggestion,” says William Poundstone, author of the new book Priceless: The Myth of Fair Value (and How to Take Advantage of It). “Any related value that you hear just before you make your estimate really does have this big statistical impact on what number you’re going to estimate.”

via Price Anchoring, Or Why a $499 iPad Seems Inexpensive | MintLife Blog | Personal Finance News & Advice.

It’s a good introduction into the concept even though it’s written for the consumer. You still can use the principles for your business.

Poundstone’s book just made my list of books to check out.

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