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The Myth of Fair Value (and How to Take Advantage of It)

Hill and Wang, 2010
First Edition: 2010 mais...

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Editorial Rating

8

Recommendation

You might think you’re a tuned-in consumer and immune to the tricks and gimmicks marketers deploy to get you to buy their products for top prices. But beware, says prolific business author William Poundstone: Your brain is keeping you from making rational cost decisions. This tour of the latest information on pricing techniques is well worth its price tag. Heed his information on the behavioral science that explains the flaws in the heuristics (rules of thumb) that keep shoppers and negotiators from being completely rational, and therefore, completely sharp. getAbstract recommends Poundstone’s smart facts, research and insights to every consumer or business manager who wants the best deal at the right price and thus needs to know what the right price is.

Take-Aways

  • A person’s perception of the fairness of a price depends on environmental and experiential cues.
  • Buyers really don’t know what something should cost, so they take their cues from “relative differences, not absolute prices.”
  • Companies raise prices by shrinking their products, and most shoppers don’t notice.

About the Author

William Poundstone is the author of several business books including Fortune’s Formula and How Would You Move Mount Fuji?


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