Entrepreneurs often scoff when I tell them how they present their pricing is more important than the actual price.

You see, in 2024, KFC Australia faced the problem: How to make their already successful “$1 french fries” seasonal deal even better?

This campaign has been running for years now, and customers were growing sick of it. 

Yes, even a $1 deal.

So, if you think lowering your price will make a difference in the long run, think again.

You know what will, though?

The perception of your price.

Let me explain, by showing you what KFC did:

Act 1 - Message

“In order to bring the right ingredients into the mix, we looked at the literature and found 18 different principles from psychology most relevant to the perception of value within fast-moving consumer goods.” - Ogilvy Behavior Strategist, Sam Tatam

KFC hired Ogilvy, a marketing agency, to produce 90 different ways of saying “$1 french fries” and got them down to 5 core psychology frames.

1. Scarcity - People place a higher value on an object in a limited supply.
   • Headline - “$1.00 french fries won’t be around forever”
     
2. Reciprocity - People feel the need to pay back when they receive something.
   • Headline - “‘You wanted free french fries, but we’ll meet you halfway with our french fries for $1”
     
3. Anchoring - Users put a bigger weight on the first piece of information they see. This time it was all about the quantity anchor.
   • Headline: “A deal so good you can only buy four”
     
4. Value payoff -  If something feels too good to be true, people start to question it. So Ogilvy gave the limitations to the offer to justify the deal. 
   • Headline: “$1.00 french fries - pickup only”

      Keep in mind, KFC Australia doesn’t do delivery.

5. Social norming - People will follow the actions of other people.
   • Headline: "Everyone’s enjoying our french fries for $1, why not you?”

Act 2 - Testing

KFC tested each of the 5 headlines using Facebook ads for a week, to see which one has the best engagement.

Experts from Ogilvy found that "reciprocity" and "anchoring" outperformed the rest by far margin.

Why is that?

Because price stopped being the main topic of the product. Quantity became the new focal point. “Are you buying 3 or 4 fries?”

Act 3 - Promotion

KFC ran the winning campaigns both on radio and TV in Australia.

The results? A 56% increase in sales of fries! 

The "anchoring" headline worked so well, the 4-pack fries sales increased by 84%!

So, what are the lessons here?

It’s not about the price. It’s about your customer’s perception of it.

Test your offer before you go all-in on it.

Use the help of experts. There’s a reason they are experts in their respective fields.