What is the Framing Effect in Behavioural Science
One of the simplest and most powerful tools in behavioural pricing is the framing effect. It refers to how the way information is presented (the “frame”) influences the decisions people make.
Let’s say you’re selling a monthly subscription. Would you rather offer it as:
- £10/month
- £120/year
- £30/quarter
Each option communicates the same overall price, but how it’s framed affects how customers perceive the value. A yearly plan might seem more cost-effective, while a monthly option feels more manageable. The right frame depends on what motivates your audience.
Comparison: Subscription Pricing Frames
We also use framing in discount strategies:
- “Save £20!” feels more impactful than “10% off”
- “You’re missing out on savings” taps into loss aversion
Comparison: Discount Framing
We also use framing in discount strategies:
- “Save £20!” feels more impactful than “10% off” something that costs £200, however…
- ‘50% off’ feels more impactful than ‘£5 off’ for something that costs £10
- “You’re missing out on savings” taps into loss aversion
Framing your product image is also important
The relative size of your product image to the size of the price can also make a difference to the perception of price. Fast Food outlets have been busy testing this with digital displays to optimise their product to price ratio.
Behavioural Testing
It is dangerous to assume that the framing effect will work in every context. Testing for your specific context is vital to understand the effect and be able to optimise your pricing strategy.
At CX Lab, we test different frames using our behavioural testing platform to find the combination that drives the highest response – before you implement any change. Our ability to rapidly test, learn and optimise reduces risk and maximises ROI.
References
Tversky, A., & Kahneman, D. (1981).
The framing of decisions and the psychology of choice.
Science, 211(4481), 453–458.This is the foundational study introducing the concept of the framing effect. Useful to reference when explaining how different presentations of the same information can lead to different choices.
