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Why Rory Sutherland has a £3.99 headache | Nudge Newsletter

Published 26 days ago • 1 min read

Veblen Effect

​Read online​

Last week, I wrote about how Blue-Emu successfully sells pain relief cream (that doesn't actually cure pain).

It indicated that perception trumps reality and reminded me of this study 👇

Rory Sutherland described this eloquently in a recent talk, saying:

“I don’t have a $0.79 headache—I’ve got a $3.99 headache!”

It's not just painkillers that benefit from higher prices. Eco-products do too.

Research¹ cited in the brilliant Science Says measured sales of sustainable products.

Over six tests, the two researchers found that:

  • Eco-friendly backpacks were seen as 7.8% more eco-friendly when priced higher.
  • Lower-priced backpacks were seen as 8.3% less eco-friendly.

In addition, participants estimated that an eco-friendly detergent would cost 42% more than a non-eco equivalent.

There's a perceived link with price and effectiveness.

For painkillers, an expensive drug seems more potent.

For sustainable brands, an expensive bag seems more eco-friendly.

Sometimes it pays to charge more.

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Enjoyed today's newsletter? Reply and let me know. — Phill ​

P.S. You can read all previous newsletters here.

¹Kumbargeri, A., & Tripathi, S. (April, 2025). Price green inference: The role of green= higher production cost lay belief. Journal of Business Research

Science says: low priced products seem less sustainable

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As a behavioural science practitioner, I believe in the peak-end rule.

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Nudge Newsletter

Phill Agnew

I spend 18 hours each week turning marketing psychology into readable newsletters.

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