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As seen in Inc.

Research shows how we perceive numbers affects our behavior.

Pop quiz. Which set of numbers will affect your behavior more: $1.99 and $2.00, or $2.00 and $2.01? If you said the first group, you are a psychological mastermind.

If you want to change a person’s behavior, sometimes all you have to do is change a number. At my company, we change prices all the time to make our services more (or less) attractive to a buyer. But why do some number combinations work better than others?

Whether you want someone to buy a certain product or encourage someone to run a 5K, research has shown the way you list, package, or group your numbers can make a big difference in people’s actions.

Here are six different ways you can change someone’s mind by changing how you present numbers.

1. Online auctions: Set low bids to get higher returns.

 

If you happen to sell items on online auctions, research has shown that lower bidding prices can lead to higher returns for sellers (and higher prices for buyers).

Why is this? According to Robert Cialdini, author of The Small Big, a lower starting bid encourages more people to participate in an auction. On the other hand, a high price acts as a barrier for entry, resulting in fewer bidders.

According to Cialdini, once a person makes a bid, they feel more committed to winning the auction and will continue to make more bids. So the more bidders who enter into bidding, the better for your final sale price.

2. Package deals: Put the benefits before the price for more success.

 

When you have a package deal (e.g., x dollars for x items), the way you order benefit and price determines if people will take the deal. For easy to understand deals, such as 10 dollars for 10 songs, the order of price and benefit do not matter to the buyer. People can easily calculate the value.

However, if you have a more complex deal for your clients, the order of price and benefit matter. For example, what offer is more likely to persuade buyers: 70 songs for $29.99, or $29.99 for 70 songs?

According to Cialdini, people preferred 70 songs for $29.99. Why? When things get complicated, people like to see the benefits before they see the price.

3. Price lists: How you list numbers determines your product’s relative value.

 

When listing prices, the surrounding prices matter for determining the value of adjacent items. For example, if you want to sell more $35 bottles of wine for your restaurant, is it better to list the $35 bottle after the $15 wines, or after the $60 wines?

Cialdini explains that due to “perceptual contrast,” the order we present numbers is important to how we determine the value of an object. If you see a $60 wine first and then a $35 wine, that $35 wine seems much cheaper (and you will see it as a good deal). However, if you see a $15 wine first, then the $35 wine, the bottle seems more expensive (and you’re likely to ignore it).

So if you want to sell more $35 bottles of wine, list them after the $60 dollar bottles.

4. Always end your prices end with .99.

 

Have you ever wondered why so many prices end in .99? It makes people think prices are much cheaper than they are.

JC Penny’s learned this psychology of numbers the hard way when they changed prices for all their .99 items: changing, for example, all the $18.99 and $19.99 prices respectively to $19 and $20 dollars. A one penny increase shouldn’t have affected sales much. However, the perceived difference in price resulted in a 30 percent reduction in sales.

So what did people perceive differently?

According to the left-digit effect, Cialdini says we pay more attention to the first digit we see (since we read numbers from left to right). When you see the first digit is a 1, then the overall price of the item seems smaller than if the first digit were a 2, even if the price is only one penny apart as in $19.99 and $20, or in $1.99 and $2.

The overall effect of rounding up a penny to an even dollar makes the item seem a dollar more expensive.

5. Exercise: Unrounded numbers can get people off the couch.

 

If you want to get off the couch and exercise more, you should choose an unrounded number for your target goal. For example, would you rather run a 10k or 9.9k, attend a 29 or 30-minute meeting, go to a 1.55 minute training session or a 2-hour training?

While the difference is small, the effect can be quite large for participation. Cialdini says by using unrounded numbers, the task seems more achievable and you can have greater participation.

6. Goals: Set a number range for your team to better meet targets.

 

People are more likely to complete a goal when they are given a number range to aim for rather than a single number. For example, if your goal was to lose weight: Would you lose more weight if you were asked to lose 1-3 pounds a week, or 2 pounds a week?

In a study on weight loss, Cialdini stated the 1-3 pound group lost more weight–an average of 2.67 pounds in the first three weeks compared to just 2.2 pounds for the 2 pound a week group.

Why is a number range better? Cialdini says that people find a number range more attainable. When you have a single number, people might give up if they don’t achieve that number, but with a number range, they are more likely to meet the goal.

Setting number ranges has several implications for business and your life. For example, Cialdini suggests that sales groups leaders can give a number range to encourage better performance for sales goals. Or, in your personal life, you might find it easier to eat 4-6 servings of fruit and vegetables a day than 5 servings.

So, whether you are pricing items to sell, looking at a range of items to buy, or setting goals, remember you can change someone’s behavior by changing how you present numbers.

About the Author Ken Sterling