How Do Car Companies Use Pricing to Sell You More?

How Do Car Companies Use Pricing to Sell You More?

For the next couple of posts, I will be telling you about how large companies use pricing to drive your behavior in ways that benefit them.

Everyone is familiar with how most cars, SUVs and trucks come in different trim levels.  The higher the trim level, the more equipment and the higher the price.  Their objective is to get you to SPEND MORE.  They pick out equipment for each trim level and set a price for that model/trim level.  Typically the customer does not want to spend money on all of the additional things added to the equipment from the prior level.  They set a price that is a discount to what the sum of all of that equipment would sell for as individual options to convince you that this is a good deal.  Key to the grouping of options, is to leave out some really desirable options at each trim level so you have to get the top trim level to get what you want, even though, that level might have many options you don’t want.  This whole process is also applied to packages of options.  Have you noticed how any individual options are even offered on cars today?  It is almost none.  They are using pricing to drive your behavior!

This is also compounded by dealers who buy few of the lower priced trim levels because they want to sell you more expensive models.  If forces buyers in a hurry to buy more than they want.  For more information or to get help with your pricing strategy, click on this link

Bryan B Mason

Apollo Consulting Group, Newport, RI

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