First recorded .99 cent purchase: People originally started .99 cents was to ensure that their cashiers were morally incentivized to put the money in the register. As before this there was a high rate of theft…
Official study: You can see the full study if you like.
“Through the cooperation of a direct-mail women’s clothing retailer, we were able to conduct a well-controlled experiment testing the sales effect of using retail prices that end in the digits 99 rather than 00 (e.g., $29.99 rather than $30.00). The results indicated that the use of 99 endings led to increased consumer purchasing.”
The main reason the 9 wins was due do something called the left digit effect. Which will change what seems like $3.00 to $2.99. Even though its really only a penny difference, when compared side by side. The $2.99 feels smaller due to it starting with a 2 rather than a 3.
The examples above may not be extensive, we believe as a reader of our site you can understand or have seen this many times before.
– Best used during promotions when consumers see the compared prices on the same tag and are more likely to make side-by-side price comparisons
– While there are benefits, we caution managers against blindly applying it. For example, reducing product prices from $3.00 to $2.99 may encourage more purchases, but it also imposes a decrease in the net margin.
Comment below some ideas we may have forgotten
The best number is the most you can charge. With the next being a 0 or 9. And the only difference is if it’s being compared… If compared to another price .99 works best, if not .00 is just fine.