Surely you have noticed that most prices end at 99 euro cents, regardless of whether it is a physical store or online. It is a psychological pricing strategy that exerts strong pressure on the customer's purchase decision, since it leaves him thinking about the price he is spending and, in his mind, due to that missing cent, it will always be less. If you are thinking of applying it in your store, do not hesitate. You should. And we are going to continue explaining why, other types of additional pricing techniques and the best way to do it.
Neuromarketing: why prices end in 99
Most companies, brands, chains and shops know this strategy and apply it. And, even though we all know it, we keep falling for it. It is good and makes us assume that those 99 cents do not exist. Or rather, that there is no higher price. We always round down because we want to buy something we like and we want to fool ourselves. That penny of difference that would have to be rounded up is not visible.
If something is worth 29.99 we will always think that we are paying “twenty-something euros” instead of 30 reais. It is a mixture of the power of 99 that is already installed in our psyche and not seeing how that first number on the label is greater. The visual power of that number on the left is key. The numeral on the left will always have a greater monetary value than the cents we see on the right. That is why we always dismiss 9 and think that the first number on the left is the one that commands the price when making decisions.
Even though we can rationally round up and say out loud that we're paying that extra penny, our minds already have a very strong visual bias. When buying, decisions must be made constantly. They can be resolved more or less quickly, but tiredness or being busy with more things can prevent that logical part from having weight in the decision.
What is the difference between the strategy of 95 and 99?
Actually, there is hardly any difference on a psychological level. Both want to avoid setting the price with the next number so that in the minds of the customers the price seems lower as we have already explained. Since the 99 strategy is a much more widespread practice, there are stores that opt for the 95. Each one has its advantages, but the principle is the same: the number on the left is the most important and it has to be smaller.
Advantages of the 95 strategy:
- It is less used and can give customers more confidence.
Advantages of the 99 strategy:
- You earn 4 cents compared to the 95.
- It is ideal for online stores where the price can be seen in a larger size.
The psychology of numbers: odd numbers sell more
Neuromarketing mixes the psychology of advertising and applies it to prices to achieve greater profitability in a way that does not involve large advertising campaigns. These strategies work and are available to everyone, you just have to know how to apply them.
One of the most surprising studies has been the one that has determined that odd numbers sell more in retail. They are more attractive to customers and they always think that they are paying less than what they really pay. 3.99, 5.99 and 7.99 are numbers that are liked. And then there is the king: 9.99. It is the limit between considering that something is barely worth money and it begins to be an expense to be counted in the mind and then noted on the monthly accounting list.
Another filter that always works: From X.99
Creating a category and setting its price from the lowest, implying that some of them go up, still implies that there are things at that low price. And, again, since you want to spend little money and take advantage of sales or bargains, you look at the entire section.
In physical stores, it is placed in small print next to that large price on a section of the store. That price continues to justify why the prices end in 99, becoming a double neuromarketing strategy.
In online stores it is filtered by categories. It is especially useful in sales and in the end it allows people who were looking to spend less to find things they like more at a higher price, but since they have seen them as part of a lower category or a sale, they end up making the decision to buy them.
Price rounding management module
Knowing why prices end in 99 and its success encourages you to apply it. Performing this pricing on a website can be long, tedious and lead to errors if done by hand. For this reason, from idnovate we put at your disposal a module to round prices and be able to manage it in a very simple way. You can apply both the strategy of 99, 95, and odd numbers or price from an interval. And what is better, you can introduce more filters such as: round prices by currency, country, by adding a discount coupon, shipping costs, supplier, stock and more.
This way you will avoid that penny that will make you lose more than win. You don't want that extra penny.