Retailers, restaurants, and businesses alike have utilized psychological pricing tactics in some regard. After Christmas Sale. Psychological Pricing Strategies Marketing Essentials Chapter 26, Section 26.2 . <>/Pattern<>/ExtGState<>/Font<>/ProcSet[/PDF/Text/ImageB/ImageC/ImageI] >>/MediaBox[ 0 0 720 540] /Contents 4 0 R/Group<>/Tabs/S>> I’ll walk you through what psychological pricing is, some pros and cons, strategies, and thoughts on whether your B2B business should consider psychological pricing. This is the fancy and more official name for all the prices you see in-store that end with “9.” Researchers at MIT and the University of Chicago found prices ending in “9” create increased customer demand for products. When they see a price that they feel is unfair, then they’ll go to a competitor’s product without a single thought. When negativity is what influences consumer reactions, it spreads like a contagious disease to their entire network. A slightly low price will catch customers’ attention and encourage them to purchase to save those few cents. Longer prices appear to be more expensive than shorter prices, even if they’re the same number. The people prefer to get a discount and free stuff, using all these strategies will encourage them to buy more while we do not get hit by a considerable discount. The perfect balance would be retailers selling their products at the price customers can afford and customers understanding how much the products are worth. One of the most common examples of charm pricing is ending a price in 9 or 5. Even if the initial price of the item has increased to cover the cost of giving another one for free. But basing your pricing structure on your competitors means they’re the focal point for your business. This gives you the opportunity to increase sales for specific products while consumers feel like they were able to get a pretty good deal. Copyright 2020 Leaf Group Ltd. / Leaf Group Media, All Rights Reserved. A flash sale offers very high discounts on items for a short period of time which leads consumers to impulse buy. Psychological Pricing is the concept of setting a price that sounds lower than it worth, and the customer will treat the product as lower than what they actually pay. This pricing work very well even it is the same as giving a 50% discount. ", 51 Best Spirit of Giving Slogans and Quotes, 20 Irish Construction Industry Statistics and Trends, 101 Positive Affirmations for Anxiety and Stress Relief, 100 Powerful Money Affirmations for Financial Abundance, Four Temperaments Explained: Sanguine vs Choleric vs Melancholic vs Phlegmatic Personality Types, 125 Powerful Morning Affirmations to Start Your Day, Explaining the 4 Color Personality Test: Blue vs Green vs Gold vs Orange, 200 Motivational Words of Encouragement for a Friend [Affirmations & Quotes], The 6 Female Personalities: Alpha vs Beta vs Gamma vs Omega vs Delta vs Sigma, 100 Inspiring Words of Encouragement for My Son [Affirmations & Quotes], The 6 Male Personalities: Alpha vs Beta vs Gamma vs Omega vs Delta vs Sigma.