Latest / The Pricing Marketing Podcast with Fexingo: Price Anchoring, Bundling, and Conversion Pricing
How a $200 Tire Anchors You Into a $50 Oil Change
Lucas and Luna explore the bait-and-switch pricing model used by tire and auto service chains: how a heavily discounted oil change—often $29.95—serves as a loss leader that anchors customers into believing the shop is cheap, only to upsell them on premium tires, alignments, and fluid flushes. They break down the specific margin structure: the $29.95 oil change loses the shop roughly $5 per car, but the average tire sale generates $150 in gross profit, and over 40% of customers who come in for an oil change leave with at least one additional service. The episode also examines how written…
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