Impulsive, Irrational Pricing!

Do you see what I see??

No?? Got an eye problem?? 

Go back to the image again. Stare at it, PLEASE!!!

Do you see it now??

Well, this is what I see:

What I see is a brilliant, amazing implementation of irrational pricing

Look at the top of the menu where a 7" Margherita costs Rs. 75.

If you go for the 10" Margherita, it costs Rs. 170!!

Huh??

Technically, a 10 inch pizza in size is 43 % more than the 7 inch pizza.

But cost-wise, Rs. 170 is 126% more than Rs. 75 !!!!

In fact, if I buy 2 Domino's pizzas of 7 inches each, I get 14 inches of pizza and pay Rs. 150; but I need to pay Rs. 170 to get only 10 inches!!

Look further - If I buy 3 pizzas of 7 inches each, I get 21 inches to enjoy and pay Rs. 225; whereas 13 inches as a single pizza costs me Rs. 315!!!

WOW!!

This proves that:

- Consumers are completely irrational when it comes to making pricing decisions when they see choices.

- They choose the size they want, not the price.

- Then, they just 'accept' the price presented to them!

Lessons:

- Create a 'need based' pricing matrix - not a volume or input based pricing structure. Notice how the Inches (") printed, is the smallest font on the menu!

- By presenting lots of variations and choices, the human mind migrates to what it wants. It does not look at alternative options when one choice seems logical:

To elaborate - if the 2 of us are eating a pizza, we may call for a medium pizza and share it.

Instead, we should call for 2 separate pizzas and also give away a few extra inches to some friends!

We would've saved money and made someone happy too!

- Don't get too scientific about pricing. Get fuzzy, irrational and emotional. It works!!!

To mock or not to mock

Last to last week I went to meet my cousin studying in local engineering college, I had great time to be back into kind of college-hostel environment, I stayed there for weekend. Talked to many of his classmates, listen to what their thoughts and expectation and dreams about job / after job, life.  

These are my observations/ views :

1. Other than for 1 or 2 exceptions, all of them did BCA as their grad and joined for MCA - "just to do a PG"!  When ask why - they just don't know why, no one ever asked them!

2. Someone felt that going for MCA will help then learn C++ better, because they learn on C for BCA. Lucky we don't have a C+++, otherwise these colleges will start DCA also

3. Most of the girls think that they will have a better positioning in marriage market.

4. Most of the boys think that they will have a better positioning in marriage market.

5. Most of them seems to have read in a leading local daily that doing MCA will fetch them a better job.

6. All of them don't have any idea of the job they are going to do when they join a company - even after spending 4.5 years of their peak youth.

7. They don't know anything about the industry they are entering into - companies, jobs, market, future, education options, academics etc...

8. They just don't consider companies other than Wipro, TCS, Infosys etc as their prospective employers - the reason here is also primarily the marriage market, not their career growth or not even money!.

9. Majority of them don't know how to communicate. I'm not commenting on their English - they don't know how to communicate in any of the languages.

10. All of them have C/C++ in their CVs as their only language and just don't know who is K&R and don't know how to write a program, compile and make it unless then have Turbo C in front.  They don't know whats #include is all about. Most of them have never seen an executable made by their C/C++ programs.

11. They don't have any programming skills (and all relevant skills), basic knowledge about data structure, algorithms etc.

12. Most of their decision are influenced by ignorant teachers, parents, friends and media - event if they think otherwise. They don't have an opinion of their own - even after becoming adults!

My Advice was mostly around (though I didn't preach and was more like a listener there):

1. You wasted the most precious 4.5 years of your life

2. You have 3 more semesters to correct what all you are missing

3. Its your life, you are in charge - you make decisions - not your parents, uncle/aunts, teachers, friends, relatives etc...

4. Work on your skills. Skills are different from knowledge - you need to develop it - whereas you can acquire knowledge in various ways.

5. Read/Listen/Speak/Watch Movies etc., so that you gain exposure and attain the right mind-set/attitude

6. Support your peers - collectively you can work on your shortcoming in the coming 3 semesters.

I really felt pity seeing most of them (happens during taking interviews as well) - victims of 'excel to get a degree - not knowledge' mentality, most of them are going to become slaves with some IT companies. Some of them will endup in teaching - circle of life!

But found few originals among them with a sense of direction, entrepreneurship and purpose for life!