Why removing prices raises enquiries and lowers trust
Withholding a number generates contact and also generates an inference. Buyers assume anything concealed is concealed because disclosure would not help.
Intuition test — answer before you read on
Why does hiding a price raise enquiries while reducing trust?
Contact us for pricing. The form fills up, the sales team is pleased, and a quieter population of visitors leaves having concluded the product is expensive and the process will be tiresome. Both effects are caused by the same missing figure, and only one of them appears in the pipeline report.
What everyone sees
Hiding price is defended as a way to have a conversation before the number frames everything, which is a real benefit for complex products. The framing treats non-disclosure as neutral, a deferral. Buyers do not treat it as neutral. They treat it as a decision that was made for a reason, and they reason about the reason.
What is actually happening
Grossman’s analysis of the informational role of warranties and voluntary disclosure produced the unravelling result: where a seller could reveal quality cheaply and does not, buyers rationally infer the unrevealed value is at the bottom of the plausible range, which pressures every seller above the bottom to disclose. Milgrom’s good news and bad news theorems generalise the logic, showing that in equilibrium silence is informative and is read pessimistically. Applied to a pricing page this predicts exactly the observed split: enquiries rise because the only way to obtain the figure is to make contact, and confidence falls because the absence of the figure is itself read as a message about it.
Why it stays hidden
The trade hides because one side of it is measured and the other is not. Form submissions are counted precisely; visitors who inferred a bad answer and closed the tab are indistinguishable from visitors who were never interested. The reporting system can see the cost of disclosure and cannot see the cost of concealment.
Silence is not the absence of a claim. Buyers read an omitted number as the worst plausible one, and that reading is rational.
Silence is not the absence of a claim. Buyers read an omitted number as the worst plausible one, and that reading is rational.
Collect this card
Silence is not the absence of a claim. Buyers read an omitted number as the worst plausible one, and that reading is rational.
0 / 10,000 collected
Sources & further reading 2
- Grossman — the informational role of warranties and private disclosure about product quality
- Milgrom — good news and bad news: representation theorems and applications
Cross-references
Related files
-
Hidden Mechanics Entry #0008The hole in your pen cap is a lung
That small hole in the top of a ballpoint cap is not for airflow to the ink, or for pressure, or for manufacturing. It is there because people chew pens and occasionally swallow the cap.
Adept -
No visual on filePlatform Mechanics Entry #0287
The reason a platform’s rules change after you build on them
The rules were generous when they needed builders. Once the builders are invested, the rules can be revised, because the cost of leaving exceeds the cost of complying.
AdeptThe hidden part #0287Generous terms attract investment. Investment creates dependency. Dependency permits revision. The sequence is not accidental.
Platforms Open file -
No visual on filePlatform Mechanics Entry #0284
Why network effects make second place worthless
The value of the first network rises with each user. The value of the second rises too, but the gap between them widens rather than closes.
AdeptThe hidden part #0284The first network large enough owns the people. The second can copy every feature except the one that matters.
Platforms Open file -
No visual on fileHabit Loops Entry #0302
The reason a habit survives the loss of its reward
The reward that started the habit can vanish entirely, and the habit continues. What was once a means to an end has become the end itself.
AdeptThe hidden part #0302Repetition outlives reinforcement. The habit that was built by a reward no longer needs it, and no longer checks.
Habit Open file
Annotations are reserved for archive members.
Sign in to annotate