Taking Care of the Pennies

When I started freelancing, I gave some thought to how much I should charge - what would be fair, and how much I'm worth.

I decided to offer a flat rate, whatever the project, because it infuriates me when I visit a freelancer or agency website and there's no indication of how much they're gonna quote you.

I'm not saying the rate will never change, but I've pretty much decided to keep it as simple as possible and make sure it's always visible in one place.

But what does this have to do with those of you who hire me to write copy for your e-commerce sites...?

Pricing Your Products

A couple of decades ago we went through a period where it seemed everything was priced at a penny less than the whole pound - 99p, £1.99 and so on.

These days it's a bit different. Pound shops fix your purchase at a whole number, and cut down on the pockets full of change. Supermarkets are as likely to charge 58p as they are to price a product at 59p - and that's even without multibuys and reduced-to-clear discounts.

So which approach do you take? You might think that online, where people are likely to be paying by card, rather than cash, the odd penny will make little difference to securing a sale. You'd be wrong.

Pennies and Perception

Researchers at the Rutgers School of Business-Camden have been looking into the impact of that odd penny - or in US terms, the odd cent.

Their conclusions compound one of the original copywriters' dilemmas - how to say 'cheap' without saying 'worthless'.

When people don't want to pay much for a product or service, they will add 'cheap' to their search query. But keyword this on your site, and you risk putting off would-be customers who are looking for a prestige product or simply want good value for money.

The Rutgers research, compiled by marketing professor Robert Schindler, shows that the price of a product has a similar effect.

"Something that costs $19.99 is considered much less expensive when compared to something priced $24.99 [than when the comparison is between $20 and $25].

"On the other side, it can give the image that an item is of low or questionable quality."
- Rutgers professor of marketing Robert Schindler

Dicing with Pricing

There's a maelstrom of conflicting advice out there, but the rule of thumb according to this research is as follows:

  • if price matters, charge a penny less than the pound

  • if quality matters, charge a whole number of pounds
However, it may be worth considering a best-of-both approach - keep your 'value' products separate from your 'quality' products and set both their prices, and your landing page keywording strategies, accordingly.

The genius aspect of search is that, as people land directly on a product page, they may never need to know your pricing strategy across your store as a whole.

It's all an educated guess, at the end of the day - but it's an often-overlooked aspect of truly optimising your e-commerce site from all angles.