Joey is shopping for golf balls in your store. Let’s say he filters by price. The cheapest golf balls you have come in a six-pack and cost $19. Then there is a 20-pack box of golf balls that goes for $59. And finally, there’s a 36-pack box of golf balls that retails at $109. Which is the better deal for Joey?

The six-pack is the cheapest but that’s because it has the fewest golf balls. If Joey is an avid golfer, he would probably lose all six balls in a week. Once that’s factored in, the 36-pack starts looking very attractive. Joey is getting six times as many golf balls with the 36-pack even though he’s paying more.

But once you break out your calculator, you realize that the 20-pack is the best deal for Joey. At $19 for the six-pack, he’s paying $3.17 per golf ball. With the 59-dollar 20-pack, that cost comes down to $2.95 per golf ball. With the 36-pack, the cost is $3.02 per golf ball— better than the six-pack, but worse than the 20-pack.

Problem is, Joey is going to have a hard time figuring this out. He could do math if he really wanted to, but who wants to? If Joey buys the 36-pack and later discovers he could have spent less money per golf ball by buying the 20-pack, how do you think he will feel?

It’s your duty to make the shopping experience as easy as possible for your customers. It prevents problems like these. People are generally bad with math. Even when they’re good with it, they like to avoid doing it. It’s your job to do it for them. Calculating and displaying unit prices for your customers saves them a lot of trouble when it comes to price comparison.

And it’s not just bulk products that require unit pricing. Any products sold in varying quantities can use unit pricing. 20 ounces of cereal for $5 vs 30 ounces for $7? Which is the better deal? A 12 oz jar of peanut butter for $10 or a 16 oz jar for $12? Which is the better deal? Unit pricing answers all these questions for your customers.

In the case of bundled products like golf balls, show both the bundle price and the price for each individual golf ball. For others, you can display the price per unit of measurement (ounces, pounds, quarts, gallons, liters, etc).

Utility pricing

When dealing with competing products that may not be directly comparable physically, like say pills vs syrups in the case of medicines, apply utility pricing. For OTC medicines this would be the price per dose of the drug in question, like say the cost of one pill vs the cost of one cup of syrup.

Benefits of unit pricing

  1. It speeds up price comparisons
  2. It gives customers confidence that they’re getting the best deal on their purchase.
  3. It’s legally required for various products (especially groceries) in many jurisdictions.