Pricing illusion!
Any shopper who is buying a thing for $49.99 is fully conscious that he is in effect paying $50, right?
Wrong, according to a psychological pricing theory. Research has conclusively proved that people would grab something if the price tag shows “$9.99”, but not if it is $10! And that explains why so many goods and services have prices ending in .99!
Shoppers are particularly susceptible to the kind of offers cited above, which are known in the trade as “9-ending” or “just below” prices. They tend to perceive such “odd prices” as being significantly lower than they actually are, tending to round to the next lowest monetary unit. Thus, prices such as $1.99 is associated with spending $1 rather than $2. It is strange that even consumers who are very savvy and perfectly rational fall prey to such psychological gimmicks!
The Indian economist and academic, Kaushik Basu, who is presently the Chief Economist of the World Bank employed game theory and divined that even rational consumers start processing the price perception from left to right and tend to mentally ignore the numbers they see on the decimal places as insignificant. This phenomenon is exploited by vendors by charging the largest possible last 2 digits or the “cent component” (99¢) without significantly affecting the perceived price of the goods by the shoppers! Researchers have termed this as “Left Digit Effect”.
Such a perceived lower price, which is only an illusion actually drives greater demand than if priced with solid full numbers on the left denomination!
A real-life experiment was conducted by Rutgers University in US with a sample size of about 90,000 customers and women’s clothing catalogs.
For the experiment, the researchers divided the customers into three groups. One group got catalogs with the traditional prices, one got prices ending in .00 and one got prices ending in .99.
The 99-cent catalog significantly outperformed the .00 one, recording 8 percent higher sales even though the average price decrease was only three-hundredths of a percent.
Standard pricing formulas say that retailers will get a 20-percent increase in sales for a 10-percent drop in prices, yet the 99-cent approach generated almost half as large an increase in sales for a price cut that was minuscule.
It is actually an information-processing reduction phenomenon, providing a false indication that the sale is a deal, which is not to be!
The teasing .99 gambit is not confined to everyday things like apparels, toiletries, stationery etc., but are applied even to such high price items like computers!
Though such enticingly marked-up pricing is a norm in many shops, it is significantly employed during holiday cut-price sale season.
In India, such prices are termed as “Bata” prices, since price of footwear sold by Bata India Ltd normally end with the number “99”.
But some upscale retailers shun such pricing practices holding the view that it is cheap tactics to game the psychology of the consumers and is a wee bit unethical!
It is a strange fact that people have a tendency to make such irrational purchasing decisions, which is gainfully exploited by sellers. You can’t fault them for your susceptibilities, can you!?
**mindvault**
Mind Vault is a premium cognitive support formula created for adults 45+. It’s thoughtfully designed to help maintain clear thinking
**neurosharp**
neurosharp is a high-quality cognitive support formula made to elevate memory, attention, and overall mental performance.
**prostadine**
prostadine is a next-generation prostate support formula designed to help maintain, restore, and enhance optimal male prostate performance.
**sugarmute**
sugarmute is a science-guided nutritional supplement created to help maintain balanced blood sugar while supporting steady energy and mental clarity.
Hey! Just launched TurboJot — the AI-powered outreach tool that actually wrote and submitted this message. It auto-fills forms with human-like messaging and precision targeting, consistently driving more conversions than email or ads. Book a demo on our site: https://go.turbojot.com/discover
**glpro**
glpro is a natural dietary supplement designed to promote balanced blood sugar levels and curb sugar cravings.
**mitolyn**
mitolyn a nature-inspired supplement crafted to elevate metabolic activity and support sustainable weight management.
**vittaburn**
vittaburn is a liquid dietary supplement formulated to support healthy weight reduction by increasing metabolic rate, reducing hunger, and promoting fat loss.
**prodentim**
prodentim an advanced probiotic formulation designed to support exceptional oral hygiene while fortifying teeth and gums.
**zencortex**
zencortex contains only the natural ingredients that are effective in supporting incredible hearing naturally.
**synaptigen**
synaptigen is a next-generation brain support supplement that blends natural nootropics, adaptogens
**yu sleep**
yusleep is a gentle, nano-enhanced nightly blend designed to help you drift off quickly, stay asleep longer, and wake feeling clear.
**nitric boost**
nitric boost is a dietary formula crafted to enhance vitality and promote overall well-being.
**glucore**
glucore is a nutritional supplement that is given to patients daily to assist in maintaining healthy blood sugar and metabolic rates.
**wildgut**
wildgutis a precision-crafted nutritional blend designed to nurture your dog’s digestive tract.
**breathe**
breathe is a plant-powered tincture crafted to promote lung performance and enhance your breathing quality.
**energeia**
energeia is the first and only recipe that targets the root cause of stubborn belly fat and Deadly visceral fat.
**boostaro**
boostaro is a specially crafted dietary supplement for men who want to elevate their overall health and vitality.
**pinealxt**
pinealxt is a revolutionary supplement that promotes proper pineal gland function and energy levels to support healthy body function.
**prostabliss**
prostabliss is a carefully developed dietary formula aimed at nurturing prostate vitality and improving urinary comfort.
**potentstream**
potentstream is engineered to promote prostate well-being by counteracting the residue that can build up from hard-water minerals within the urinary tract.
**hepatoburn**
hepatoburn is a premium nutritional formula designed to enhance liver function, boost metabolism, and support natural fat breakdown.
**hepato burn**
hepato burn is a potent, plant-based formula created to promote optimal liver performance and naturally stimulate fat-burning mechanisms.
**cellufend**
cellufend is a natural supplement developed to support balanced blood sugar levels through a blend of botanical extracts and essential nutrients.
**flow force max**
flow force max delivers a forward-thinking, plant-focused way to support prostate health—while also helping maintain everyday energy, libido, and overall vitality.
**prodentim**
prodentim is a forward-thinking oral wellness blend crafted to nurture and maintain a balanced mouth microbiome.
**revitag**
revitag is a daily skin-support formula created to promote a healthy complexion and visibly diminish the appearance of skin tags.
**neurogenica**
neurogenica is a dietary supplement formulated to support nerve health and ease discomfort associated with neuropathy.
**sleeplean**
sleeplean is a US-trusted, naturally focused nighttime support formula that helps your body burn fat while you rest.
**memory lift**
memory lift is an innovative dietary formula designed to naturally nurture brain wellness and sharpen cognitive performance.
Thanks for sharing. I read many of your blog posts, cool, your blog is very good.