Pain Reduction with Placebo Pricing

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Pain Reduction with Placebo Pricing

In this post, Uwe Heiss explores the effect of placebo pricing on pain management.

Here is an interesting study about placebo pricing (Waber 2008). Dan Ariely, a behavioral economist at Duke University showed in a study with 82 healthy volunteers that the price of pills contributes to their placebo effect. All study participants got a painful stimulus – they were given an electric shock. They were then offered a placebo pill for pain relief and received the same stimulus again. The price of the placebo made a difference:

85% of volunteers who took placebos priced at $2.50 per pill experienced less pain after taking the placebo pill

61% experienced pain relief who took the same pill, but priced at 10 cents

That’s more than a 20% difference between groups. So this study nicely supports our hypothesis:

Higher price increases the placebo effect.

Does this sound familiar? The placebo effect seems to be a variation of a more general theme. Do you have examples in your field? And how much should I charge for one pill of Zeebo Relief? Right now it’s at 44 cents…

Read the full article, The Price of Feeling Better, on LinkedIn.