Why do prices end in 99?

You've probably noticed that most prices end in 99 euro cents, whether in a physical or an online store. It is a psychological pricing strategy that exerts strong pressure on the customer's purchase decision, since it leaves them thinking about how much they are spending and, in their mind, because of that missing cent, the price will always seem lower. If you're thinking of applying it in your store, don't hesitate. You should. Read on and we'll explain why, along with other pricing techniques and the best way to apply them.

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 works, and it 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 one-cent difference, which should make us round up, stays out of sight.

If something costs 29.99, we will always think that we are paying “twenty-something euros” instead of the actual 30. It is a mix of the power of 99, already ingrained in our psyche, and not noticing that the first number on the price tag is higher. 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 the 9s and think that the first number on the left is what determines the price when making decisions.

Even though we can rationally round up and say out loud that we're paying that extra cent, our minds already have a very strong visual bias. When shopping, we constantly have to make decisions. They may be made more or less quickly, but tiredness or having a lot on our minds can stop that logical part from carrying weight in the decision.

What is the difference between the 95 and 99 strategies?

Actually, there is hardly any difference on a psychological level. Both aim to avoid using the next whole number so that, as we have already explained, the price seems lower in customers' minds. Since the 99 strategy is a much more widespread practice, some stores opt for the 95 strategy. 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 lower.

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 found 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 popular numbers. And then there is the king: 9.99. It marks the line between something that barely costs anything and an expense that you start keeping track of in your head and then writing down in your monthly budget.

Another filter that always works: From X.99

Creating a category and advertising its prices “from” the lowest one, which implies that some cost more, still signals that there are items at that low price. And, again, since people want to spend little and take advantage of sales or bargains, they browse the entire section.

In physical stores, the “from” appears in small print next to the large price displayed over a section of the store. That price once again explains why prices end in 99, making it a double neuromarketing strategy.

In online stores, this is done through 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-priced category or a sale, they end up making the decision to buy them.

Price rounding management module