The three pricing strategies, according to Spenser Lum, include anchoring, good naming, and fair value. Anchoring entails setting the tone for what clients see first—according to Lum (2017), setting a high value first and letting people bid based on the price influence their expectations easily. An anchor price changes buying behavior and influences the way people accept products regardless of the pricing (Lum, 2017). Therefore, you should start high and work your way down when giving prices because low numbers make anything else above seem expensive. In addition, it entails having substantially high-priced packages, which creates a reference point for the rest of the packages.
The next strategy is to use good names. A good naming strategy, such as using descriptive words, has been established to increase sales value by up to 27% (Lum, 2017). Therefore, using descriptive names that can show quality and craft consistent with the brand value and depiction can improve sales by some margin. Finally, the third strategy is to focus on fair value. The pricing of an item should represent the value it gives to a client because everything seems overpriced (Lum, 2017). Therefore, you should take time to set people’s expectations. For example, listing a series of small little charges calls attention to what every little thing costs and justifies the pricing.
Overall, I find Spenser Lum’s pricing strategies effective because selling products entails setting the atmosphere. Anchoring, good naming, and focusing on value work properly to ensure all people’s expectations are managed and the right message is passed. Other companies that venture in new technology development, like Apple, Sonny, and Samsung, use price skimming strategies (Pokorny, 2020). The strategy recognizes the cost and inherent difficulties in bringing a new product to the market.
References
Lum, S. (2017). 3 Pricing Strategies Everyone Should Know. Web.
Pokorny, E. (2020). 4 global pricing strategies for selling internationally. Weglot Website.