OT?: Pricing psychology

Ask Cecil "The World's Smartest Human"

And if you spend the rest of the afternoon browsing around the anecdotes at the Straight Dope, I apologize in advance...

Having lived in Chi-town for many years, I am aware of Uncle Cecil's musings. (I loved his explanation for why earthworms come out of the ground when it rains...)

I was hoping for something more along the lines of a college text, research paper, etc. While the "99" practice is common, I wonder if folks are just blindly "following it" without understanding it (i.e., if it is even VALID).

Eveidently there's no short answer:

-- Joe

It's probably too late, given the ubiquity of paying with plastic, but even so I'd bet that a store that priced items "tax included" with even-dollar prices would make a killing (figuratively).

I do miss Chicago. Lived out in the NW 'burbs several decades ago but it was a great city. Don't miss the weather...

I don't know. I've never understood the pricing. For me, $X.99 is $(X+1); X9... is (X+1)0... So, the "99's" are just an extra step figuring out what the *real* price is (which is how I suspect it "works" -- given how lazy most folks are as thinkers).

But, I suspect there is even more to it than that (i.e., issues beyond "99").

I miss the pizza. And, of course, the pizza!

Schaumburg, Mortgage Grove, Palatine, Hoffman Estates, etc. for me. Also decades ago.

"Exposed flesh warnings" :>

I chuckle thinking of the temperature ranges my body has experienced: -26 (WCF -83) to +117 (THI ???). I think I prefer the cold to the heat, though -- you can always put on another layer of clothing; OTOH, once you strip down to *skin*, there's not much else you can do to cool off (without mechanical assistance)!

Though there is *something* to be said for short sleeves at XMAS... :-/

One of my favorite websites is joelonsoftware.com.

Joel has an opinion on many things and there is a search box on the home page. I typed in "pricing" and got 27 articles.

He's a savvy and entertaining writer -- highly recommended.

Some posts on the Psychology of Video Games relate directly to pricing (eg. ). It's a well-written blog that provides references, and many of the posts concern the general concepts of making people want to have something.

-a

Very apt and was on BBC Money Box programme today, battle of the pound shops, now rebranding as 89p and 85p shops in a PRICE WAR !!

Another article about same incident (URL may wrap)

Can't remember where but I remember hearing recently an argument that the "99" pricing is actually a security thing rather than primarily psychological. If I buy something from you (the checkout operator) for 99p and I pay for it using £1 then you have to open the till to get me my change: you can't simply pocket the pound. I don't know exactly how much truth there is to that but it does make a certain amount of sense.

I was once told that retail outlets price to 99 rather than whole currency units to force the sales people to ring the sale through the till, to get the change, rather than just put the money in their pockets.=

I didn't say I believe it, its just a reason relayed to me.

Regards, Richard.

• formatting link
  Designed for Microcontrollers. More than 7000 downloads per month.

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  Certified by T=DCV as meeting the requirements for safety related systems= =2E

Thanks! I read a few of the "hits" and would agree with the above assessment -- though his focus seems to be geared towards *setting* a price. I am more interested in the "human nature" aspect of the issue -- i.e., understanding the irrationality of this behavior.

E.g., we all *know* we are "going to die". And, maybe a few

... only if you don't think about it very hard! :>

E.g., the practice started long before "smart" cash registers.

You'll also note that old "mechanical" cash registers had a "No Sale" button -- which opened the cash drawer without recording the transaction.

Likewise, anyone doing business in "cash" (far more common when the 99 practice got started, eh?) could just as easily keep a wad of "change" in their pocket without *any* record of the transaction.

The fact that it has persisted leaves me wondering if this is just "habit", "sinister" or otherwise.

The corollary of tenths of cents in gasoline prices (US) is similar. However, you will recall that as prices increased beyond the capacities of the old "mechanical" gas pump meters, there was a time when gasoline was NOT priced at $X.XX9/gallon (e.g., some pumps were re-geared to record "half gallons" so gallons were effectively $X.XX8). And, there is nothing in modern electronic meters *requiring* a $X.XX9 price point...

Ha! That was interesting.

Actually, I was chagrined to realize *my* idea of "Video Games" was so *completely* off the track! Time passes!

As a side note, I picked up a copy of _How We Decide_, today. Yet another in a series of similar titles that I've digested looking for "enlightenment" (so far, all I've garnered is: "People are irrational fools that are easily exploited")