Pull on these 5 levers to increase revenue.

There are some really cool psychological levers you can play around with in business.

But when I started out, I had no clue what they were. 

Over the last decade, I’ve really leaned into learning about consumer behaviours and testing the ideas I discovered on my own business. 

Today, I want to share five tactics I've learnt that have completely transformed our revenue growth over the years both online and in-store. 

Here they are:

- Scarcity 

- Bundling 

- Decoy effect 

- Loss Aversion 

- Price anchoring 

Let's look at each of them in a little more detail and how you might be able to get value from them.

1) Scarcity

The harder something is to get, the more people want it and are willing to pay for it. 

So genuinely limit the number of sales. 

Make it a little more challenging to get your hands on to drive up the value. 

This can be as simple as telling people how many you have on hand. 

For example, if you can only handle 2 clients a week - say that! 

If you only have 12 portions of a special menu item - Tell customers and count it down.

Genuinely telling people about the limited supply you have will drive demand for it.

Here are some other examples of using scarcity:

• Seasonal products/services
• Limited edition products
• Special menus
• Flash sales

Next is...

2) Bundling

As a customer, buying things is hard work sometimes. 

It takes mental effort which sucks when you’re in a rush or indecisive. 

So do the pre-work for your customers to make their life easy.

Group common products and services together.

Or explain the next logical step they can take once they have used you for something. 

It's about removing friction points and helping them to make simpler purchases that benefit them.

Here are some examples you may have seen before:

• Membership + Coaching
• Beauty treatment package
• Bundled software
• Coffee and pastry
• Tea cup and tea

Most businesses then offer a discount when you bundle. 

But I prefer to add value instead of discounting.

Try putting something unique in the bundle that you can’t buy on its own that makes it good value.

3) Decoy Effect

You often see this with coffee pricing.

The small will be $5

Large will be $6

Extra large will be $6.5

Only $0.50 to get more.

In a 3-tiered structure, it's a larger step from the base price to the middle price, then a smaller step to the premium price.

It’s about setting the price of the common thing people buy closer to the high-end product.

In this example, most people but large coffees so make the step to extra large appear small.

It encourages people to want to upgrade to unlock better value.

To get the most value from this you need to display your pricing alongside each other.

4) Loss Aversion

Taking something away from a customer can be a powerful move. 

Costco do it with their memberships - ie if you don’t have the membership you won’t access the great pricing.

In fact, you can no longer even shop there - so you renew it.

But other people do it by telling you that the price is about to go up. 

So if you want to get it at today’s price, you better jump in by X date. 

It's perfect for people who have been lingering in the background waiting for a special to happen before buying.

Instead of discounting to get them, say the price is going up.

The last is...

5) Price Anchoring

I love this one. 

You basically set a ridiculously high price on something to make all other things look like they’re great value. 

But don't be dodgy here.

If someone takes you up on the ultra-premium, high-priced thing it still has to be excellent.

But its true power is to put the thing you actually want to sell into perspective and make it look cheaper.

For example:

One-to-one coaching might be $12,000 per quarter. Or the digital course from that person might be $497.00.

OR

The premium Waygu burger on the menu might be $35.00

But your just as awesome beef burger might be $24.00. 

(Unless you wanted everyone buying the Wagyu Burger. In which case refer to Decoy Effect and price the beef burger at $31.00)

—

After reading this, you're probably going to recognise these tactics in nearly every business you've dealt with in the past.

Good.

Tune in to how other people use them.

Think about how it makes you feel when they use the tactics on you.

And remember that all of these tactics in business can be used for good or bad. 

My hope is you use them genuinely. 

Not to deceive people, or offer low value. 

You’ve always got to put up your best work, lead with customer delight and offer loads more value than they expect. 

If you do that and employ these tactics, you'll be freaken unstoppable.

I hope it helps!