Price Increases and Psychology of Numbers

Why 95 instead of 99?

You already broke rule #1 by not having the prices end in 9. Goggle that shit for interesting reading. And for an answer to your question.

1095 and 1195 feel the same to me, and 1195 feels a bit "rounder" and less jarring than 1095. Jumping right to 1195 seems reasonable.

Note: I have no facts or expertise justifying my opinion.

What does the competition charge?

What about Two payments of $585? or 1187.43 tax included. I'm always worried when things end too even my customers are thinking I just came up with that number. I'd much rather have a number be $103.59 Than $100. Round numbers without .99 signify brand superiority. High end women's purses are $750, $725 etc. Never $724.99. Because that purchase is to be a big purchase and add more prestige to it.

That being said, lets say you're playing up to a highly competitive group of parents. Simply saying Sally goes to a 2k a quarter tutor vs $1200 a quarter tutor doesn't sound as good. People might round that to 1k. I think you have to know your target market to choose the right numbering scheme. Ending in 6 through 8 can tell people it's the absolute lowest price. However lowest price may not be what you want to market. Being HIGHER priced that your competitors, makes them want to know why you're so expensive? Then you just have to give them a solid reason why you are.

I like $1195 much better than $1095. It feels less made up.

I like $1187.43 even more than $1195, it feels like things were line entered and on an actual invoice, compared to $1195 seems more "made up" when stacked against it.

I'm surprised Numbers has not posted in this thread. Oh, he's RRP'ed, right.

I just went to whole number pricing at my restaurants and I know my crew and customers appreciate it for the simplicity. If there has been an impact on sales because of I'm not trying to "trick" my customers with .99 pricing, it hasn't shown up in the sales. Only difficult part is when I do need to adjust pricing it takes a large price hike (percentage-wise) to keep the whole number pricing. For example, to raise the price of a $2 soda I could go to $2.09 or $2.19 to incrementally raise the price. Now I can either do $2 or jump to $3 which would be way too expensive for a soda, so I'm either locked into $2 or perhaps $2.25.

I found in my business. When my price needs to go up. If I was at a whole dollar say $2 for a fish. Any price besides that means the price went up. I literally started my business with only whole numbers. But now I do .99 because people are dumb. All day long a fish that is $9.99 is $9 not $10. I literally hear them say, oh $9 thats not too bad.

Also I had some prices change on me since the price of a live fish can change week to week. If a fish was $2, then went to $2.19. Every single customer noticed the price went up. Now that I use $2.29, $2.59 etc. The never notice if the price goes up or down. It comes down to, "I think I paid 2 something last time".

I've also noticed that percentage off on something is useless because people can't math. If I give you the choice of 20% off or buy 5 get 1 free. People will choose the getting 1 free every time. Even though they're same price per fish. They will choose to buy an extra and get 1 free, than just buy say 4 and save the 20%.

I too thought, I'm just gonna take the bullshit out of pricing for my customer. All I found out after about 6 months of doing it was that customers remembered my competitors price being a dollar cheaper than mine, even though I price shop them and know they are 1 penny cheaper than me.

I'd just change my price yearly with CPI and differentiate my products a different way than price. Competing on price is too hard.