LexiconChannels
Reference price
السعر المرجعي
Definition
A reference price is the price a customer remembers and uses to judge any new price, usually the menu board at the branch. It builds on Daniel Kahneman and Amos Tversky's reference point from prospect theory (1979); a gap above it feels like a loss, so channel pricing keeps memorised “ruler” items close to branch prices.
In plain words
The price in the customer's head; anything above it feels like a loss.
Also searched as
- reference point
- internal reference price
- price anchor
- app vs branch price
- السعر المرجعي
Origin and credit
The concept comes from Daniel Kahneman and Amos Tversky. What the series adds is the application to Saudi multi-branch groups and the decision rule.
Original source
Where it is used
In the Doctrine and the Playbook
In the Channel Ledger
In Beneath Marketing
- Why isn't 29 riyals on HungerStation the same as 29 riyals at the branch?Beneath Marketing · Episode 1 · The ruler above the till
- Why isn't 29 riyals on HungerStation the same as 29 riyals at the branch?Beneath Marketing · Episode 1 · The idea beneath the price
- Why isn't 29 riyals on HungerStation the same as 29 riyals at the branch?Beneath Marketing · Episode 1 · Where the money leaks
Related terms
How to cite this definition
Alhajj, S. (2026). “Reference price”. In The Revenue Engineering Lexicon, version 1.0. Riyadh. https://seiflden.com/lexicon/reference-price/
For the concept itself, cite the original: Daniel Kahneman & Amos Tversky, “Prospect Theory: An Analysis of Decision under Risk”, Econometrica 47(2), 1979, pp. 263–291.