Best Numbers to use for Pricing
Have you ever wondered what the Best Numbers to use for Pricing were? We break down the best numbers and more. Jump around using our Table of Contents
• Original study
• Number 9
• Number 5
• How to apply to your business
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
Disclaimer
– 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
Conclusion:
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.
If you liked this, check out our official psychological pricing pdf or view more Psychological Pricing Strategies