You might wonder how you can avoid mentioning price? One way to avoid price is to name a price that is far outside any plausible range. For example, if you sell products on auction, you might start with a price so low that effectively it is not a price. Will this get you a better price in the end?

It might not just get you a better price. It might get you a sale where you got none before. As recounted in SmartMoney, January 2004, John Stack of 'A City Discount' sells restaurant equipment on eBay. He started out on by listing his items at prices he was willing to accept. Unfortunately, no one bid. So he changed tactics and listed items at one dollar. Clearly, that's like not giving a price at all. So what was the result?

An industrial ice cream maker first listed for $999 had failed to attract a single bid. Then Stack listed it for $1. This time the ice cream maker drew bids and sold for $2000. Ongoing experimentation confirmed this was not a fluke. Now he prices 95 percent of all used equipment at a price of one dollar. He started on eBay in 1999, closed his old store in 2001, and reached a sales level by 2003 that exceeded by ten times his sales of 1998. An excellent success and, even better, he has one less thing to worry about now that customers set the prices.

According to Stack, "When you start something at a dollar, it seems people bid on it and develop an attachment to it, even if they have to go above what they originally intended." No doubt this emotional aspect is part of the story. Also, the act of bidding itself becomes an investment; functioning purely as rational economic beings, we must add the value of our bidding time and effort to the value of the equipment.

But I also believe that the following is true and important: when we show the equipment with a price of $999 customers think about the price¡­when we show the equipment with a price of $1 customers think about the equipment. Price is a negative and, if at all possible, should come at the end of our story to the customer, not at the beginning.

Don't supermarkets have to put prices on everything? If you are a supermarket, competing against Walmart's Superstore you might price a few items as so-called loss leaders as in: "This week 12 eggs for 60 cents only. Limit etc." Put a really low price on one part of your offering, so you get a chance to sell the value of your total offering. Of course, our friend from Xi An offering to drive us to our hotel for free knew this already too.

Street vendors around the world know about this too. They like for you to first offer a price. If you refuse, they may give you a price, a totally exorbitant price. This makes the smart customer smile, who then might offer a price that is a third of the obviously ridiculous price. Much haggling ensues and finally a price of a bit more than a third of the originally quoted price is settled on. Everybody is happy. You even feel a bit guilty. But you'll get over that guilt feeling once you discover your new acquisition for sale in a nearby department store for less than half of what you paid.

But that just happens with street vendors, right? Don't be too sure. Robert Cialdini reports on an experiment where customers who were first shown a $3,000 pool table, regardless of what they wanted to see, ended up buying on average a table for more than $1,000. Customers who were first shown lower priced tables and then were encouraged to buy a more expensive table ended up buying on average a table for $550. In psychology this is called 'anchoring'. While the $3,000 price may be far outside what the customer wants to spend; it does adjust upward what he will in fact spend. Mr. Stack may do even better on his auctions when he mentions the price that a used machine would sell for if it were new. The one-dollar price is not a price; the comparable new equipment price both raises the value of the used equipment in the customer's mind and anchors an amount in the customer's mind that will make whatever the ultimate price turns out to be more palatable.