Picture this:
I’m sitting in the back of a TukTuk racing through the busy streets of Bangkok at 50+ km/h. No seatbelt, no anything.
It’s my first full day here in this crazy city.
Yesterday, my friend David and I – who I flew to Thailand with – had checked into our Hotel on Khaosan Road.
Just a couple hours later, I find myself in this Tuktuk… questioning my life decisions.
We’ve been here for less than 40 hours and I’ve already spent HALF my travel budget!
“How did this happen?!” I wonder.
It was like a chain reaction. One purchase led to the next. Not because I couldn’t control myself, but because… it just seemed logical.
Let me explain:
As my friend David and I left our Hotel this morning, we were immediately approached by this local street food seller.
Now, because there are A LOT of people trying to sell you something in the streets of Bangkok, we immediately had our guards up.
“No thanks,” David and I said in chorus.
But the guy wouldn’t let loose.
“I’m not trying to sell you ma friend!” he said in his Thai accent.
We stopped, hoping that he would let us go soon. Well, he proved to be a very nice guy and gave us some tips, such as “Always use the white Tuktuks, they’re cheaper and funded by the government, ma friend!”
And next thing you know…
A white Tuktuk pulls up out of the blue and comes to a halt next to us. Talk about timing.
Our “friend” talks to the Tuktuk driver for a bit and proudly exclaims that he’s negotiated a ‘special price’ for us: “20 Baht ma friend! Only 20 Baht!”
Without being able to voice a single objection, we’re “pushed” into the Tuktuk and the chain reaction has officially started.
First stop:
A boat tour. Price? $30.
We think that’s a good deal, considering the normal boats south of the river cost twice as much – according to the Tuktuk driver. (We later find out that that was complete bollocks.)
Still, we enjoy ourselves a nice boat tour through the Chao Phraya River of Bangkok.
2 HOURS later, we step out of the boat, and guess who’s still there?
Our Tuktuk driver.
He negotiates yet another ‘special price’ for us ($1/hour) and we agree to hop on… again.
What we didn’t know?
The $30 we spent on the boat tour was only the beginning. It would only get more expensive from here.
We were informed that there was a national holiday today – eVErYthInG was aT LeAsT 20% cheaper. At least that’s what they told us. When we later googled this holiday… we couldn’t find a single article about it – not even on page 22 of Google. 🤦
But because of this supposed holiday, we were offered yet another ‘special deal’ …
Next thing we know, we’re walking into a tailor store, where they apparently sell “original Armani suits” but without the branding – yeah right…
The next 30 minutes go by as a blur.
All I remember is that they handed us 2 free beers immediately upon entering the store. At least 6 salesmen tried to sell us a suit – which tbf they did very well. But I said no. They down-sold me on one of their “original Armani shirts” and because by then the alcohol had kicked in… I ended up pulling out my credit card.
Another $60 gone.
And things continued like that for the rest of the afternoon. We bought: a boat transfer to the full moon party on Koh Phangan ($100), dinner & snacks ($10), and another ticket for… I don’t even remember what ($10).
“What on earth just happened?” David asked me on the way back to the Hotel.
“Bro, I don’t know. All I know is that we’re $200 poorer, 1 shirt, and a crazy story richer.” I replied, “Bangkok feels like a giant sales funnel.”
And here’s the deal:
I blame the effectiveness of that ‘sales funnel’ on multiple factors. But one of the reasons was their pristine:
No matter what we bought… it was always framed as a ‘special deal’ or a ‘heavy discount’.
Now, we aren’t stupid. We understood that they were most likely bullshitting us. But still… this psychological trick made us subconsciously think we were getting a better deal.
Price anchoring works like this:
You set expectations by mentioning a higher price. You then say… but YOU (ma friend) are getting it for less.
That’s why discounter stores always have the original prices crossed out.
“Usually $1,393,949, today only $2.49!”
The secret here is to make it believable.
I’ve found that price anchoring works best when you give a believable reason for your price drop that’s grounded in reality – preferably a factor that’s outside of your control (like a national holiday).
This way, you easily remove your customers’ skepticism.
I want you to be ethical though (not like the salesmen in Bangkok). Pick a REAL reason for why you’re “reducing” prices.
Maybe a Christmas deal.
Maybe compare it to a competitor’s price.
Maybe some new technology allows you to charge less.
Okay, this email was long. Still hope you learned something :)
Have a nice one ma friend!
Tim <3
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