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

by William Poundstone

Book Overview

Prada stores carry a few obscenely expensive items in order to boost sales for everything else (which look like bargains in comparison). People used to download music for free, then Steve Jobs convinced them to pay. How? By charging 99 cents. That price has a hypnotic effect: the profit margin of the 99 Cents Only store is twice that of Wal-Mart. Why do text messages cost money, while e-mails are free? Why do jars of peanut butter keep getting smaller...

• Format: Hardcover
• Language: English
• ISBN: 080909469X
• ISBN13: 9780809094691
• Release Date: January 2010
• Publisher: Hill & Wang
• Length: 336 Pages
• Weight: 1.36 lbs.
• Dimensions: 1.3" x 6.3" x 9.3"

Customer Reviews

Well wrtitten, entertaining, and informative

I found the book to be well written, entertaining enough that i finished its 336pp in three evenings of enjoyable reading. I read some of the other less than stellar reviews and would wholeheartedly disagree with those critics on the value of this book. It simply proposes to tell one of how marketers use various gimmicks to control prices, and some of these are in subliminal manners. I was never under the guise that this book was meant to be considered a course in price theory, which would be a junior level course in a pursuit of a bachelors degree with a major in economics, but some readers might have thought that reading this one book would prepare them to challenge Greenspan or Summers on economic theory. We all have our biases and prejudices in all areas of life, and PRICELESS helps to explain how and why we may feel in a certain way about the price of Gucci bag, a pair of Jimmy Choos, and etc. The evidence provided is primarily anecdotal and not meant to be an all encompassing erudite study in economics. If you want to read a very entertaining book on how many large marketers decide to set what they consider to be their optimal prices for their various products then add this book to your reading list. If you want to become an economic expert, I would suggest enrolling in an institution of higher learning and expecting to take four years of concentrated study in that area before you even think of grad school. I liked this book enough that I bought additional copies for each of my kids, so that should say how much I liked it.

An essential read for business and life today

A fascinating, useful and well written book. This author is an expert in this area. If you have ever bought a car, negotiated with your child or been to an auction, the author is talking directly to you. The field is called psycophysics and Poundstone brings it to life. After you read this you will understand how anchoring your sell with a very high price is better for getting the highest price, why he who sets his price first has the advantage, how web pages are using background images to prime readers to make decisions and where union negotiators have a winning plan regardless of the outcome. Ever wonder how the Sierra Club negotiates and will always come out ahead of the resource companies? He tells you why you ignore what clients say they want and watch what they do. This is a must read for the CEO, CFO, CMO and every parent.

Fascinating Subject

I heard the author on NPR. Prices are all around us, and we never realize how we're being manipulated. This is "news you can use" for just about everyone: consumers, businesspeople, folks negotiating a salary. The author tackles some high-powered topics, but everything is in short, fast-reading chapters. I wish more books were like this one.

Priceless lessons in pricing

I ordered this book after a good review in the Wall Street Journal. From the title it sounds like a fairly dry book on pricing theories for a professional marketing audience. In reality it is a very entertaining, well researched book about how prices are set from all kinds of businesses, how consumers react to them - and why. Having worked in marketing and as an entrepreneur for 20 years, I have come across some of the stories quoted in the book already. However, I was not aware, that a German professor (Hermann Simon) runs the biggest pricing consulting firm in the world, that restaurant menus are better designed without leading dots before the price (otherwise they guide the eye to the lowest priced item) or that supermarkets yield a $2 higher average shopping cart revenue if the path through the market goes counterclockwise instead of clockwise. It will take some work to extract pricing lessons for your own business (you actually have to READ the book first!) but it is pleasant enough! Oliver Fritsch Cendesic Marketing