Ryan Dohrn explains why customers pick the middle pricing tier and how to fix it. A steep jump from $1,000 to $2,500 kills upsells, but incremental steps like $1,000 to $1,500 make the leap feel logical. Three-option pricing works because humans naturally think in groups of three.
What is going on, friends and fans? Ryan Dohrn here, your friendly neighborhood sales coach. Hope you're having a great week out there in sales land. We're answering your listener questions sent in to ryan@ryandohrn.com. D-O-H-R-N. First question comes from Michael in West Virginia. Hey Ryan, I found your 3 pricing options to be very helpful. Unfortunately, everybody's buying the middle option. What do I do to get them to spend more? So Michael, first and foremost, thanks for sharing with me those 3 options are working. It's called the Goldilocks principle, kind of my porridge is too hot, my porridge is too cold, my porridge is just right. So when you design your pricing packages or your plans based on a good, better, best model, most of the time people are going to gravitate towards that middle model. Now, One of the things to consider is, Michael, is the pricing between your packages a logical leap? Let's— as an example, if the lowest option is $500, then $1,000, then $2,500, there's not a logical leap to go from the middle option to the top option. But there is a logical leap to go from the bottom option to the middle option. So it's called a logical leap, and you want to make sure that it makes logical sense if you're gonna jump between pricing packages. So in that example, you might go $500, $1,000, $1,500, as opposed to $500, $1,000, $2,500. Some people call that asking a client to stretch a little bit. Well, it's not that they won't stretch, it's just that it's probably stretching them just a little bit too far. Now, for some of you that don't know what Michael is talking about, I'm a big advocate of 3 pricing options: either a good, better, best, present competitive Prominent, something like that. I'm not a big fan of gold, silver, bronze, things like that. That's kind of been overused. But I do see out there in sales land that when you give 3 pricing options, you almost always close more deals. Why is that? Because A, people like recommendations, and B, everything prices out in groups of 3. Everything in nature that's worth a darn, whether it's H2O, Father, Son, Holy Ghost, Good, better, best. 3 Musketeers, 3 Little Pigs, 3 Blind Mice, 3 outs or 3 strikes to make an out. Everything worth a darn prices or sets up in groups of 3. And typically, Michael and everybody, that's why it works so well. So Michael, I hope you give those ideas just a little bit of thought and be sure to reach back out and let me know if that helps. Hey, you got a listener question? Got a question for me about anything in sales, love, or life? Send me an email, ryan@ryandohrn.com. We get a lot of them, but we'll do our best to feature them right here. Friends, never forget, if sales was easy, everybody'd be doing it, and they're not. We're not crazy. This is a great career that'll feed your family for a lifetime. Hey, love to speak at your national sales meeting or something like that. Reach out to me over at ryandohrn.com. And if you're watching us on YouTube, be sure to subscribe down below. Click the little bell button to make sure you're always alerted when the next listener question is uploaded to the good old internet. All right, we'll see you next time.
