I’d like to give a more formal hypothesis to this assumption with a theory that I have developed to make pricing more appealing to customers whether or not the price is too expensive for what you are selling. (No, it may not influence themto buy something way too overpriced, but may make it seem more reasonable.
My theory works like this:
For anything that is under $10, I prefer to go with odd numbers. For example, $1, $3, $5, $7, and $9 seems cheaper to me than say, an even number alternative. Now, to raise the price a dollar, I would go with adding $.99 to these numbers. So instead of $2, maybe $1.99 seems like a bit less money. Ironically, to me, it seems like I would rather buy something from say, the Apple store, if the cost was $1, but $.99 seems like it could be pricy. (I don’t like buying a single track for $1, so thank God there are much beter alternatives even in the apple store today.) So this is an observation I’ve made when trying to price things myself, for what you think it may be worth but still seem appealing when people may not think it is reasonable. Hopefully it works; it seems plausible to me.
Then I thought, now what about more expensive items then… does it still hold true?
Well interestingly enough, I figured out that when raising the price into the double digits, I noticed something intresting. After a little thought about what I would think would be more reasonable, I actually would prefer the last number to be even. $12, $14, $16. But another level up? $21, $23, $25. So I noticed this pattern: the even-odd pattern approach to pricing. Starting with odd numbers, making a price with an even-odd pattern in the digits seemed more appealing and slightly less expensive than other prices. I wonder if it is just my preference, or how the brain is calulating the numbers in terms of cost and expenses. Maybe the even-odd combination influences the mind to think the numbers are somehow not as even and thus maybe not as large since they do not fit as well together? Either way, I’ve noticed this when coming up with prices for my own products, and I like to use it as a guide to try to make “friendlier pricing”. Further study would be needed to confirm this observation…
Random thoughts… but hey, interesting how the mind works.
Simple observation, I know, but maybe it is just me that prefers these patterns?