Want to know the simplest way to improve the perceived value of your product/service/latest offering? Well ok, the simplest is probably to lower prices, but the second simplest way…?
‘Red prices’ isn’t some business mumbo-jumbo term that means absolutely nothing, like most business mumbo-jumbo terms do. What we are talking about here, is simply using a red-coloured font to display your pricing in. Although there is one (large) caveat to this: seemingly it will only work on men.
A recent study conducted in the UK and US looked at the impact of colour on pricing and consumer perceptions of price. One of the more interesting findings was the impact that red fonts had on male customers – on average, men rated a perceived saving displayed in red twice as high as when they were displayed in black. Conversely, women were found to be mostly unaffected by the font colour of the price.
High-involvement shopping tasks, whereby a consumer spends far greater time and effort reaching a purchase decision (e.g. buying a car or new home), were found to reduce the impact of the ‘red price’ effect. This suggests that the optimal time to utilise the ‘red price’ effect is in relation to impulse-purchase items (e.g. food stuffs, entertainment media, and books).
Looking at the data on a micro level, the perceived savings difference between red and black prices is small in percentage terms. However, from a more macro-viewpoint, with price being a key factor in most purchase decisions, it may be that the red price effect brings a customer to your business over a competitor even though your prices may match.
Importantly, the research also found that although red fonts had no significant positive impact on women, there were also no negative behavioural responses either. This means marketing teams should feel confident in testing out these findings on males without decreasing sales to female shoppers.
It’s certainly something we’ll be looking at here at Pixel. Let us know if you have found any benefit to using red prices in your marketing content.