Online Product Pricing Research Considering Price Anchoring and Online Reviews

The adjustment effect of the anchoring effect and online reviews on consumer cognition has grown to be a significant element influencing business pricing. This study explores the effects of online reviews and price anchoring on company pricing and profits by building an online product pricing model based on expected utility theory from the perspective of consumer purchasing psychology. The findings show that firms must take consumer anchoring psychology into account when making decisions if they want to increase revenue. Different pricing strategies are used depending on the variables associated with the quality of online reviews. The higher the sensitivity coefficient of reviews, in particular when the quality of the reviews is higher than a specified value, the bigger the profit. In the anchor point, the optimal price is rising. When a company chooses a higher price policy, the optimal price steadily decreases with the degree of anchoring.