How to Maximize the Effectiveness of Pricing, Payments, and Package Deals

Package-deal pricing — such as 10 fitness sessions for $120 vs. one class for $15 — can offer mutual benefits to you and your customers. As a small-business owner, you can boost your average order value to offset other costs of doing business and keep cash flowing, as well as promote customer loyalty and drive repeat purchases. Clients, of course, pay lower prices for your product or service.

But price alone isn’t necessarily what prompts people to act on your offer. A recent study by Virginia Tech marketing professors Rajesh Bagchi and Derick Davis shows that when it comes to offering package deals, the way you present your offer may play a greater role than cost in whether or not the customer “bites.”

Put Item Quantity Before Price

The study found that presenting the item quantity before price (e.g., 70 songs for $29) may make the package deal more appealing to customers than presenting the price first (e.g., $29 for 70 songs). The findings held especially true when calculating the item price was challenging and involved non-divisible figures, such as three shirts for $79.

So, consider the way you communicate pricing on your marketing materials and signage: If you’re currently using a “dollars first” approach, test the effect that leading with item quantity may have on your customers’ purchase behavior. If you’re already leading with item quantity, experiment with offering a larger quantity to see what happens.

More often than not, you should find that customers will judge the value of your package based on the quantity of items listed first, not the price. You may find an opportunity to increase both sales and your profit margins simply by shifting your approach.

Pitch by Form of Payment

Conventional wisdom says that customers also tend to spend more freely with credit, because they’re not parting with money at the point of sale. So, accepting credit cards as a form of payment can boost your business by offering increased customer convenience and reduced price sensitivity.

However, according to the study “Do Payment Mechanisms Change the Way Consumers Perceive Products?” published by the Journal of Consumer Research, understanding the different thought processes of cash vs. credit card customers can also help you to maximize the effectiveness of your sales pitches and marketing efforts.

The study found that customers who pay with credit cards tend to focus more on product benefits than on price when making purchase decisions. When a customer pays with credit, you can leverage your customer conversations by focusing on what they’re really debating: a product’s or service’s features vs. lifestyle benefits, such as quality, style, or prestige. Steer clear of selling based on value, price, or comparisons to other products or services. In contrast, cash customers tend to pay more attention to the financial aspects of the product or service, and thus marketing messages that tout price and value may resonate with them more than those based on features.

You can apply the science to specific situations to boost sales, too. For example, if you intend to sell at a venue where cash is the primary form of currency, such as a festival or a trunk show, focus on value when closing sales and developing marketing collateral that supports that.

About Stephanie Taylor Christensen

Stephanie Taylor Christensen holds a master’s degree in marketing and has 13 years of marketing management experience for Fortune 500 companies and small businesses. She is a regular contributor to sites like ForbesWoman, Real Simple, Mint, Minyanville, and SheKnows, and writes for several private business clients. Her work is frequently syndicated and sourced by Yahoo! Finance, SFGate,, and The New York Times. She is also a small business owner, having founded, and Om for Mom Prenatal Yoga in Columbus, Ohio. Connect with her on Twitter @WellnessOnLess.
This entry was posted in Marketing and tagged , . Bookmark the permalink.

@AliRomanAmway Thanks for the tweet! Has this info help you think of news ways to market your offerings? ^Ehsan


@leslie12002 Thanks for the tweet! Has this helped change any of your offerings? ^Ehsan


  1. [...] They seem less expensive than rounding up to the next full dollar. There are several ways to manipulate perception to make your high-priced product or service a little more accessible. For example, it’s helpful [...]

  2. [...] They seem less expensive than rounding up to the next full dollar. There are several ways to manipulate perception to make your high-priced product or service a little more accessible. For example, it’s helpful [...]