Three has an almost mystical symbolism and power whether you're pondering math, music, or spirituality.

Our brains just love patterns, and three is the smallest number needed to create one.

It's satisfying, complete, and somehow feels "just right" to our minds.

That's why it's so powerful when considering pricing strategies, as well.

Here are three ways to leverage the power of 3 for your pricing:

Sandwich Pricing

When businesses offer three price points, something fascinating happens. The middle option often becomes the most popular choice.

Why?

Because it feels like the "Goldilocks" option - not too expensive, not too cheap...just right.

By sandwiching your target offer between a budget option and a premium one, you create a comfortable middle ground that many customers will gravitate toward.

But, you also want to nudge them in the right direction by highlighting the middle option in some way. Some businesses note their middle option is the "most popular" or "best value," while others make it visually pop and standout.

(See Is the Price Right? for more about this and other pricing models)

The Decoy Effect

Sometimes adding a third option that nobody wants or considers a good value boosts sales of the option you're driving your prospects to purchase.

Let's say you have two coffee sizes: small ($2) and large ($3.50). People might split evenly between them.

Add a medium size at $3.25, and suddenly the large seems like a much better deal.

More people choose the large, even though nothing about it has changed!

What has changed is that your medium-priced option has shifted your customers' perceived value of your more expensive option.

(See The Decoy Ploy for more about this pricing strategy).

Good-Better-Best

This approach focuses on creating distinct value tiers that drive specific customer behaviors by offering three clearly defined options that appeal to different customer segments:

1. Good: An entry-level option with basic features at an accessible price point captures price-sensitive customers and those new to your business.
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2. Better: A mid-tier option with enhanced features and benefits represents the best value for most customers and is often engineered to be your most profitable and popular option.
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3. Best: A premium option with all available features and exclusive benefits serves high-end customers looking for everything you've got and willing to pay for it.

Each tier is designed to be genuinely attractive to a specific customer segment, which is what distinguishes it from sandwich pricing.

Need some help with your pricing strategy? Let's talk.

Until next time,

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P.S. If you missed it, last week I explained how to Frame Your Price through customer research.
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