Customers Mentality Boggles Me...

[Patrice]

Hi everyone.

It's been a while since i did not post anything. As the old arabic saying goes: If what you have to say is not more beautiful than silence, then shut up. ;-)

I will be attending a horse rally event (150-250 peoples) this weekend as is it a holyday monday here in Quebec. I will be showing my leather products and do a demonstration on leatherworking.

As i was tagging the price on my hand made item, my girlfriend and my mom (both avid shoppers) tell me not to tag 60$ but instead, 59,95$. It's seem that it's due to extensive marketing research and that 59,95$ is not on the same braket price as 60$.

Is it just me, or i just underestimated the power of a nickle? Are people really more tempted choosing a 5 cents cheaper item? Is it the same in USA?

Just between you and me, i was upset. Upset because so many people are not willing to craft their own belt, wallet and other gears, BUT, they will not buy good quality items.

I would like to read what you have to say about it and if the same thing keep running in your mind.

And please excuse me for the ranting.

Have a great weekend.

Edited May 16, 2014 by Patrice

[Hi Im Joe]

Hi everyone.

It's been a while since i did not post anything. As the old arabic saying goes: If what you have to say is not more beautiful than silence, then shut up. ;-)

I will be attending a horse rally event (150-250 peoples) this weekend as is it a holyday monday here in Quebec. I will be showing my leather products and do a demonstration on leatherworking.

As i was tagging the price on my hand made item, my girlfriend and my mom (both avid shoppers) tell me not to tag 60$ but instead, 59,95$. It's seem that it's due to extensive marketing research and that 59,95$ is not on the same braket price as 60$.

Is it just me, or i just underestimated the power of a nickle? Are people really more tempted choosing a 5 cents cheaper item? Is it the same in USA?

Just between you and me, i was upset. Upset because so many people are not willing to craft their own belt, wallet and other gears, BUT, they will not buy good quality items.

I would like to read what you have to say about it and if the same thing keep running in your mind.

And please excuse me for the ranting.

Have a great weekend.

On an unrelated note....its hilarious how close that arabic saying is the golden rule. "If you don't have anything nice to say, don't say anything at all."

[oltoot]

I have dealt with multiple frustrations over the years but have refused to knucle under in this area. I HATE $19.99 instead of $20 mentality. I have always kept my prices at full $ increments and on larger items, strive for $5, $10, $25, $50 increments. It is only with collecting sales tax that a sale comes up with pennies.

[DavidL]

Its more psychological than anything. 97.50 feels cheaper than 100 even though its only 2 dollars and fifty cents. People categorize these things in their head, in this case 97.50 your item is under 100 dollars. Value of currency also takes a roll if an item is 19.99 or 20 then people will say I can buy this with a single 20 dollar note, although its not a deal breaker to price 23 dollars.

For trade shows a round number won't make that much of a difference and I would go with a whole number since it isn't a retail store environment. Pricing at a whole number gives off that the product is good quality and is not an item that is expendable. For instance any high end boutique store for men or women majority of the time don't advertise the price on the wall and prices always ends in a whole number. Same goes with cars.

Another study also shows that if an item is priced low enough (under 30) whole numbers like 10, 15, 20, 25, placed at the front of the store (where retailers placed most of there clearance/ on sale items) will give off the feeling they are on sale, even if regular price was 9.99 and you sell for 10.

You will mostly deal in cash so I would go with 20 dollars instead of 19.99.

[humperdingle]

It's an old Jedi money trick :D

$59.95 in the eye of some shopaholics makes them assume the item is closer to $50 than $60.

Therefore, if they buy, say, five items at that price, their brains will tell them they've spent $250 and not $300

A virtual saving of $50!

Smart shopping

[Denise]

Make it $59.98. That way, being as don't have pennies up here any more, you don't have to deal with change, but people still get the psychological boost from getting a "cheaper" product. I think it does work. When we go by gas stations and the price is $129.9 a litre, we say "it's $1.29" rather than "it's $1.30". So I think it works - a little anyway...

[Chief31794]

I've always priced at $XX.99, course I got an MBA and had to learn a lot about marketing. If this technique was not effective then every retailer in America and I assume Canada wouldn't use it. You will not find much merchandise in a retail store that is an even dollar amount. Cars are priced at $XX,X95.00 because $29,995.00 seems a lot better than $30,000.00 It is just human nature that 29 thousand XXX sounds better than 30 thousand dollars.

Just my 1.99 cents worth, I could be wrong that happens a lot lately.

Chief

[Hi Im Joe]

I see what you did there Chief! LOL.

Just my 1.99 cents worth, I could be wrong that happens a lot lately.

Chief

[Chief31794]

I see what you did there Chief! LOL.

I didn't think you guys would buy it if I said it was my 2 cents worth. LOL

Chief

[WyomingSlick]

LOL This topic is an example of one of the reasons that I find the range and scope of human behavior as the most interesting subject matter I know of. The ways that people's viewpoints/ideas/thoughts are shaped by their culture, their education, their religion, their family, friends, and the multitudes of other inputs that go into making them a distinct individual is sometimes incomprehensible to those who don't share the same data set of influences and/or the same tendancies to accept, or......... reject beliefs and facts.

The "pricing game" is just an example of how merchandisers picked up on a bit of human psychology to increase their sales, and it has been around for a very long time. Even though the value of a penny is so trivial these days, the psychology still works.....so is still being used. The range of strategies that sellers use is a very broad spectrum and there are many tried-and-true techniques that are effective.

And then there are the behaviors that we do ourselves. I have observed people who buy alcohol/beer/cigarettes.......who will buy only a pack, or sixpack. or small bottle.......and then buy another the next day, (or sometimes the same day) when the most cost effective way would be to be buying a case, a large bottle, or a carton. LOL I guess they are just in denial, or they have a faint hope that they are moderating their intake that way. On the other hand, I know a fellow who buys his Canadian whiskey by the box because he gets a dozen 750ml bottes for the price of 10. He's a realist alcoholic !

By the way, I am an addict myself. But, I am also a realist. So I buy my Mountain Dew in bulk, and on sale whenever possible. And my pickle relish. LOL

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