Learn from Apple: How important is a concise pricing strategy?

Source: Internet
Author: User

Introduction: in human-computer interaction, there is an important principle: "Don't let users think". This sentence is also applicable to the application's pricing strategy. John Gruber, a well-known Apple blog, has discussed in depth the importance of concise pricing strategies in the rule of thumb: pricing shocould be simple article using Apple and the New York Times as examples, it also inspires mobile entrepreneurs. The full text is as follows:

Many companies, no matter what industry they belong to, can learn from Apple, which is simple and clear pricing. If customers know exactly how much they want to pay and what they can buy, they may just pay for it. Or, in other words, they may also pay for it. If they do not know how much they want to pay, they probably won't dig it out. For any product or service provider, how to make customers decide to purchase and pay is an important two-step process and should be well designed.

Not all payments are simple. Some companies have complicated pricing strategies. Such a company is generally a monopoly (such as a company that provides line services and fixed telephone services), or this market is separated by several giants, and the pricing is complex without exception.

Such as new car dealers and mobile phone operators. Car dealers have always implemented loose and uncertain prices (strategies). Their "tag" Prices are basically the same as virtual ones, and customers always bargain. Almost no one will actually pay for the "tag" Price. Because all other car dealers do the same, and because (at least in the United States) cars are a necessity for most people (or at least they think it is a necessity ). Mobile operators have always provided dazzling bills, which are various and a few cents of billing details. Because there are only a few mobile operators, and most people think that mobile phones are necessities.

For non-necessities, simple and clear pricing is crucial. Apple is very successful in this regard. Apple's consumer electronics are simply divided into three levels for pricing: Good/better/best. The only difference between different levels is the storage capacity. Ipod, iPad, and iPhone all follow this pattern. Even if there is a deviation, the reason is well understood. For example, the cost of a standard iPad with Wi-Fi is USD 499/599/699, and the storage capacity is 16/32/64 GB. If you want an iPad with a built-in 3G function, you need to add $130 to the standard iPad price and provide two simple traffic packages: $15 per month, M data traffic is allowed; or 25 USD per month, 2 GB Data traffic is allowed. Easy to select, easy to cancel, no hidden fees, only a few prompts will appear before your data traffic limit is reached.

Another good example is Netflix. You can get the following services by paying $8 a month to buy Netflix streaming media data:

You only need to pay $7.99 a month to watch TV series and movies instantly, whether on the Internet or on TV. Use xbox360, PS3, Wii (Nintendo), or any other device to receive streaming media from Netflix. If you want to see how long it will take and when you want to see it.

There is really no follow-up charge, and there is no deadline?

Yes, indeed-there are no follow-up charges, no cutoff time, and no hidden fees.

As long as you register a netfilx account, you can view all Netflix content on any device that supports Netflix. It doesn't mean that you will be charged for watching on an iPad or iPhone. It won't be said that it will cost more money to watch on both the PS3 and Xbox. $8 a month (after a 30-day free trial), you can get all streaming media from Netflix. This is easy to understand and sounds quite worthwhile.

This reminds me of the new digital subscription service in the New York Times. They are neither easy to understand nor seem to be worth it. Unlimited access to the New York Times costs 4 times the access to Netflix services-$35 per 4 weeks. You can pay only $15 or $20 every four weeks, however, you can only choose whether to run a specific access program on your smartphone or on your iPad (the price is the same as that of the accessed device ). How many common people can figure it out-for example, if you choose a $15 solution, you can access the New York Times website through iPad?

Netflix: a single price, not limited to devices.

The New York Times: devices are randomly divided into three prices based on their screen sizes.

Both companies have ancillary services. Netflix's supporting business is the home delivery service for DVDs or Blu-ray discs. The price is based on 8 USD per month and then 2 USD. This makes us feel that every Netflix customer is a streaming media subscriber, and those who want a real product will have to pay an extra fee. This pricing policy will guide people to subscribe to only digital products in the future.

The supporting business of The New York Times is printed newspapers. The cost of subscribing to paper-printed newspapers is lower than that of subscribing to all-embracing digital newspapers. They ignore the fact that printed newspapers actually cover the content of digital newspapers. It sounds a bit ridiculous. If you pay less, you can get the obvious physical cost: After one year, the paper delivered to the door has reached several hundred lbs. This pricing policy can only guide everyone to subscribe to paper newspapers.

I very much hope that the New York Times will develop considerably. For many years, it has been a reliable source for me to obtain domestic and international messages. However, paper-printed newspapers are getting stuck in the dark, and the digital subscription policy published by The New York Times is not very attractive to me. I can say with certainty that it is too expensive-I think the newspaper can earn more money by significantly reducing the charges and implementing differentiated policies for those subscribers who are willing to pay for it. But worse, it is too complicated. In the long run, the New York Times should generously allow everyone to access the nytimes.com website for free, while the New York Times is tempting everyone to read less.

Only a few people think they need a digital subscription account of The New York Times. There may be a lot of people who want to subscribe to a digital account, but just think about it. Only a few people will think it is essential. This means that the pricing should be simple and clear. (I would like to say that even necessities should be priced in a simple way, although not doing so may also succeed .)

I almost totally agree with knoI vihh (csdn Note: former design director of The New York Times)'s comment on this matter. Vihh writes:

The impact of this digital subscription policy will not be immediate in the short term, but the damage to the brand may be huge and lasting. It is certain that their new business effort will only result in a lot of bad reputation. These terms are subtle, and complicated billing policies are likely to catch up with most news consumers. In short, many of its terms are too complex in terms of language description and cannot be well understood, the market language has always been easy and easy to use (for example, "only pay 15 yuan in four weeks"-simply tell me how much it will cost ). I bet the people who will understand their new business in the future must be those who have to pay to read the New York Times. After a period of time, due to lack of understanding of the business at the time, subscribers will begin to lose a lot, which I will not be surprised at this.

Jean-Louis gasses (former Apple executive and BEOs founder) once tried to interpret all the policies for accessing the digital content of The New York Times-which of the following are free and paid, how much does it cost. This interpretation takes 8 paragraphs and 350 words. He concluded that these policies are too complicated:

Customers do not make purchase decisions through their cerebral cortex. This is an intelligent organ. They come back to make their decisions through the deep cut of pleasure in the brain. When a culture needs a "outcome" that is logical and recognized by society, they will find a reason for it.

What kind of pricing strategy should the New York Times adopt? Is it as simple and clear as possible, so that readers can easily understand and use it, or simply cater to their internal processes regardless of the reader's feelings? If they don't want to ask Steve Jobs (or the latter may not want to answer), they can also ask Jeff Bezos about simple pricing.

The experience of iTunes tells us that customers are willing to pay for the content, but the premise is that the payment process is simple and easy for them. Of course, make his wallet feel relaxed. Someone may argue that the customer pays not for the content but for the door-to-door service, and we have another example, Netflix on demand. The specified content is instantly sent.

For the New York Times's digital subscription business, I don't know if a simple and low-cost pricing strategy can work, but I firmly believe that at least it will work better than what they have announced. I feel that the current strategy is poor.

Original article: a rule of thumb: pricing shoshould be simple

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