It’s the three strategies of pricing:
- Price the item as XX.99 to make it feel cheaper than it is
- Price the item as a whole/round number to make it feel premium
- Price the item as a seemingly random number like XX.57 to get ahead of the shopper who are weary of the first two tactics
But it IS how we see prices. If there weren’t science behind it, they wouldn’t be doing it.
A lot of marketing strategies are pseudoscience. Just like a lot police investigation practices or body language assumptions.
$20 and $10 shipping: 😡
$30 and free shipping: 😄
It is kind of a dick move when companies overcharge for shipping. I only charge calculated shipping on large or heavy items because those are the ones that vary a lot and I don’t want someone in zone 8 (like Southern California or even someone in HI buying it and shipping costing more than they paid. If it’s under 1 lb then I just give free shipping and bake it into the price.
This reminds me of my early shopping days using EBay, where it wasn’t uncommon for sellers to under-price their products so they show up near the top of the price (cheapest-most expensive) sort pile, and then charge an outrageous amount in shipping.
I’ve found that almost always (at the time), that the seller offering free or low cost shipping was usually cheaper.
That was because their fees were based on the sale price of the item minus the shipping. So they were only paying fees on 1 cent. They changed the fees so that the total sale including shipping is calculated.
Part of it is that there’s less hidden costs. I like it when it’s just “the total is $30” instead of “there’s $8 shipping and a $2 service fee and then $4 in taxes and…”
I’ve also seen some online stores lure in a customer with a really cheap initial price and then on the last page just slam them with insane shipping and handling fees hoping that the customer either doesn’t notice or feels too invested at this point to cancel their purchase.
But yes, part of it is also people are stupid when they see the word “free” as if the store wouldn’t move the cost somewhere else.
I don’t understand people who won’t pay £5 for shipping, but will instead spend another £15 on something they don’t need so they get free shipping.
All you’ve done is lost money.
It depends. If it’s something I know I’ll use, especially a consumable, I’ll do it.
From my experience working in retail I’ve seen people say out loud something like “oh, it’s only 4 dollars!” When the sticker says $4.99. This shit apparently works on a lot of people for some reason.
I do that with gas, but everybody knows the .9 cents are implied.
Most people are idiots most of the time.
Some people are idiots some of the time.
No one is never an idiot.
I generally round up to nearest bigger number or close to that. $19.99 is $20. $23.99 would probably be $25. $180 would just be $200.
No real rhyme or reason, just the bigger the number the more I fudge the “real” price upwards thanks to sales tax and a “can I really afford this?” factor.
The amount of times I’ve watched Youtubers say something like “35 dollars” while showing an image that shows the price as $35.96 happens too often for me to side with OP lol, sorry.
I’m not sure it works on me. Not because I’m some super human resistant to advertising (I’m not) but because I’m so bad at math that when they start asking me about anything involving small change I tune out and overestimate by 50% rounded into nice whole numbers.
“This is 19.99”
“Okay so it’s basically 30$.”
It gives me nice surprises sometimes when I get my receipt.
You have to be, like, better at math to do that though?
Using whole numbers can be easier when estimating
Decimals are the devil’s work.
You can remove the decimal then add it back at the end
15.50
Is
1500
Half would be 775
Or 7.75
Honestly I just want tax included on the price tag.
That’s an American problem too
It never works on me. I was taught at a very early age that pricing down by one cent of one dollar is a psychological trick and that I should round up to the nearest whole number.
Funny thing is, it still works.
On people who are actively trying to compensate for it, or did you just mean the overall population?
same way placebo still works (to a degree) even when you know it’s placebo
your subconcious is not logical, and no amount of conscious logic will fully defeat its influence
to think yourself immune is foolish and dangerous, that’s when you allow it to work even better as you “logically” explain away every manipulation you were influenced by, and convince yourself you made a decision fully by yourself. The danger gets even hotter when it comes to political propaganda that uses the exact same tricks as marketing
Yes, for the general population. Otherwise, companies will stop the psychological pricing. Same with corporate snooping to see our shopping and grocery habits and then send us with targeted ads.
that’s the important caveat:
it does NOT work on everyone, but that’s irrelevant.
if it works on even 1% of people, but has zero effect on everyone else, companies would still use it everywhere anyways.
a 1% difference over even just a couple thousand customers adds up over time.
so, no, it doesn’t work on everyone, and it doesn’t have to.
it just has to work on some people, and not deter any more people than it works on.
if anyone wonders when it does and does not work: like most of these psych-tricks the effect mostly disappears when you point it out to people or otherwise make them actively think about what they’re buying.
same for the change-the-layout-of-the-store-all-the-time thing: doesn’t work on all people, doesn’t have to.
On idiots. So on probably around 40% of population.
It actually works on smart people too.
Not really.
This is called: Left Digit Bias
I always round up the price when I see $X.99 but my grandmother always rounds it down and it pisses me off
They’re trying to fool you! Don’t be a sheep!!!
I always round way up because sales tax is so high here. 17.99 = $20. I’m usually within the $1 range when I check out.
Still boggles my mind that tax is not included in the price in the US.
It encourages more consumption
Hmm, this is the first time I get this argument, and I think you are on point.
Also “
200100” is very different from “100”.They may list it as $19.99 but I’m always going to call it twenty bucks and eleven cents.
Because it is how we see prices. It takes a bit of effort to see it as 20.
