The Psychology of £99.99

In modern commercial history there has been an idea that £99.99 is, psychologically speaking, cheaper that £100. Ok, in reality is too, but not simply by a penny. It’s as if it’s a world apart from the number it actually is… And I think this phenomena is both overused and ultimately no longer effective. When I see £99.99 I honestly just replace it with £100 and then wonder why it has been given that “99”… Are they trying to give it a charm price? In many smaller stores here in the UK there was the phenomena of the ‘Keep the penny’ that many shop owners rather liked. Not sure if it happens in other countries… I guess it does but having never lived there… *shrug*

I need to make a point of transparency here… My parents used to own a shop and I personally saw this first hand. Many times people would say ‘keep the penny’ thinking it was a rare occurrence.. No. It happened quite a lot! Some people saw this and it led to the counter top charity box, or mite box, and the almost disposal of odd pennies people couldn’t be bothered to carry around. Not so much out of charity but out of laziness and not wanting a pocket full of pennies after visiting a number of shops. The modern supermarkets have all but done away with smaller shops so this is now a moot point.

Now, Wikipedia gives a few possibilities on why this practice started. All seem reasonable but thus far we have no real idea. But here is where we see modern psychology changing in front of our eyes. People have, with no better term to hand, woken up to it all.

But now we see a new use of random pricing for items. I saw a TV the other day for £123.23… WTF? Was it literally that someone had to come up with a price over a certain threshold and just tapped a line on the keyboard? O.o

There are other times where you will see almost random pricing… It’s probably a bit more honest that you may think. An item costs me £31.26 to buy it from the manufacturer because I buy it in bulk. I then put on my 25% mark up and I get £39.08 (Ok 39.075, But you never round down!). Now that is a legitimate number, it just looks weird… BUT IT SHOULDN’T!

BTW… Sometimes you get seemingly random pricing on items when an item is on sale at  “33% off!!!”(Note extra exclamation points). This isn’t what I am talking about.

TL;DR…
I’m not an idiot. Stop treating me like I am one. Can we have round numbers for pricing please. Or at least a return to honest pricing?

For a bit of fun… Did you know that the Monster Raving Looney Party in the UK wanted to bring in a 99p coin to save on change? Rather genius in my view. B-)

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