Why do prices end in .99?

Today’s guest post from the UK offers more insight on why prices with .99 work in the US and UK and why .88 works in Asia.

There are long-standing rules of thumb that advise how to set prices, but the wise business owner knows to test everything, including pricing.

The only results that count are the ones you see from your clientele.

2 thoughts on “Why do prices end in .99?”

  1. I guess we all get had by this too often. Thinking logically I would only buy something that was obviously a ploy if its after tax price ended up being a round number (so .99 does not work). I’ve also read some interesting things about how much to lower your prices when you are trying to sell something. For something selling for a few thousand dollars I think the 10’s place holder was the most effective to change.

  2. We set a pricing strategy when we opened our store stating that we knew consumers aren’t fooled that $9.99 is really THAT much less than $10. So we decided in our store that the benefit of the psychology of discounted pricing wasn’t worth undermining our customers intelligence. We now only have items rounded up! (unless on sale or actually on a discount).

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