I'm talking about the pricing of products... any products. For some odd reason people manage to make much more sales if for example they charge "$9.99" instead of "$10". I even tried it myself and I managed to earn more sales by reducing my price from $10 to $9.99. And if you take a look at the market... any market... you will find out that a lot of products are sold @ X.99 instead of XX. So the technique really works.... but I really don't understand how that $.01 can make that much difference in sales... I know it's cheaper but .. What the heck.. it's just 0.01 cheaper and that's nothing lol. It seems that it does matter to some people though... What do you think about this?
Its not a matter of saving money to the customer, but the reason is yes it does look a lot cheaper than $10. There is also another method that I use for customers which is throwing attractive numbers For example: $19.87 This number is attractive because it looks like a reduced price as well as a price that was carefully balanced for the product. Of course it has to be the right numbers. Sometime like $19.25 does not look good. It looks unprofessional.
You're right and I've seen a lot of sellers that use 19.87. 19.25 does look a bit non professional... but that's the thing... Why is 19.87 professional while 19.25 isn't?
Its like saying this 15 years seems a lot less that the difference between ages 25 and 40, but they are 15 years apart. Same with 45 and 60. They are only 15 years apart but they seem so different.
It just looks more like a deal to the consumer, which is all that matters. A lot of retailers figured out that the .99 .87 .95 numbers attract more customers. The reason is consumers generally don't think of prices as in cents but they just look at the whole number amount.
It's about marketing. Some time ago some marketers have done a research and found that people would rather pay $9.99 not $10, it has something to do with human mentality. On the other hand you cannot sell product for $9,999 as if you use this technique people will think it's not good enough. As a rule of thumb u price small items at x.99 but posh and/or expensive items at xx.00
I'd rather just pay in xx instead of xx.99 it's easier to keep track of money and pay for things that way.
It's been studied over and over. And so has color. Market Researchers do the research then they use the results. No point in reinventing the wheel. And to force your own bias into the equation is not helpful. It doesn't matter if you think an even number is better or not, it only matters how people react as a whole. As soon as people respond to even numbers the market will shift to even numbers.
Thanks for your responses... Yes I believe it's the human mentality. Most people will see $9.99 as $9 instead of $10.... That's why it generates more sales