How do you know which retailer is the cheapest energy provider?
Some suppliers will give you several types of discount. Some discounts include “pay on time”, a discount on usage charges, a discount on the daily supply charge, a discount if you pay via direct debit, or a discount if you bundle your gas and electricity with the same retailer.
So why do retailers use discounts instead of raw numbers? They are not being dishonest on purpose. They are using a tried and true sales tactic called “price anchoring.”
Price anchoring and energy comparison
Let’s be straight: electricity is electricity. Electricity is going to be the same whether you go with retailer A or retailer B. What we’re all looking for is the cheapest possible price to pay each month or quarter.
Certain comparison sites express their retailer plans and contracts in terms of discounts, without disclosing the actual rates in dollars and cents. One of the many reasons they do this is to do with a psychological trick called “price anchoring.”
If you inform people that they can buy a product for $50, would it make more sense to express that as a price, or inform customers it “Was $100”? With the $100 price in your mind, you are likely to rationalize you are getting a bargain. The truth is that you are spending $50 regardless. You are not “getting” any extra value.
This tactic is used by some comparison websites, expressing higher discounts. A high discount does not necessarily mean a higher saving on your power bills. You must look at the numbers.
Know the real numbers – try Econnex
Unlike most energy comparison sites on the market, Econnex shows you the real savings in dollar terms and help you compare cheapest energy providers. You’ll know exactly how much you’ll save on your bill doing a measurable and transparent comparison instead of trying to do sums on the back of an envelope.
Please see below pages to learn more about electricity and gas suppliers as per state.