How sure are you about the negative impact of "early-bird". The purpose of it is to create a sense of urgency in the first group of people who visit the page, to make sure that the campaign takes off right away. Doesn't this outweigh the "you're being ripped off" thing?
"Anchoring or focalism is a cognitive bias that describes the common human tendency to rely too heavily on the first piece of information offered (the "anchor") when making decisions. During decision making, anchoring occurs when individuals use an initial piece of information to make subsequent judgments. Once an anchor is set, other judgments are made by adjusting away from that anchor, and there is a bias toward interpreting other information around the anchor. For example, the initial price offered for a used car sets the standard for the rest of the negotiations, so that prices lower than the initial price seem more reasonable even if they are still higher than what the car is really worth."
If you wanted to do an early bird special, one solution might be to add something extra at the early bird tier (but keep the same price). Or even charge $1 more for something that seemed to be worth >$1 more but was unavailable otherwise. E.g. the early bird copies are signed.
Hmm. Ok. I'm thinking there might be some strategies to mitigate the anchoring effects, which definitely exist. It seems to me that it's a tradeoff, however, and it's not obvious to me which circumstances lead to one or the other being the best approach.
Dan can probably give better answers, but as an early backer I know that I was quite eager to get in before those "early bird" copies sold out. I also recognized, though, that if I'd missed them I would have been significantly more hesitant to pledge at that point (both because the price felt higher and because it was comparatively a much worse deal). That makes me think that his (accidental?) strategy of including an early bird tier and then regularly increasing its limit might be the best of both worlds.
Comments
How sure are you about the negative impact of "early-bird". The purpose of it is to create a sense of urgency in the first group of people who visit the page, to make sure that the campaign takes off right away. Doesn't this outweigh the "you're being ripped off" thing?
I have no data, but this Wikipedia article explains the theory:
http://en.wikipedia.org/wiki/Anchoring
"Anchoring or focalism is a cognitive bias that describes the common human tendency to rely too heavily on the first piece of information offered (the "anchor") when making decisions. During decision making, anchoring occurs when individuals use an initial piece of information to make subsequent judgments. Once an anchor is set, other judgments are made by adjusting away from that anchor, and there is a bias toward interpreting other information around the anchor. For example, the initial price offered for a used car sets the standard for the rest of the negotiations, so that prices lower than the initial price seem more reasonable even if they are still higher than what the car is really worth."
If you wanted to do an early bird special, one solution might be to add something extra at the early bird tier (but keep the same price). Or even charge $1 more for something that seemed to be worth >$1 more but was unavailable otherwise. E.g. the early bird copies are signed.
Hmm. Ok. I'm thinking there might be some strategies to mitigate the anchoring effects, which definitely exist. It seems to me that it's a tradeoff, however, and it's not obvious to me which circumstances lead to one or the other being the best approach.
Dan can probably give better answers, but as an early backer I know that I was quite eager to get in before those "early bird" copies sold out. I also recognized, though, that if I'd missed them I would have been significantly more hesitant to pledge at that point (both because the price felt higher and because it was comparatively a much worse deal). That makes me think that his (accidental?) strategy of including an early bird tier and then regularly increasing its limit might be the best of both worlds.