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Pricing in decimal units - does it affect conversions?
Is $29.99 better than $30.00?

 6:24 am on Jun 5, 2004 (gmt 0)

We are based in Hong Kong but almost all our business is from overseas, mainly N. America and Europe. In Hong Kong, items are usually priced to the nearest round no. wheareas in N. America they are priced in decimal points e.g. $29.99. This sort of practice would be considered as deceptive marketing in Hong Kong.

The prices on our sites are to the nearest round no. in terms of US$. We thought that it was a good idea from the start because it would give it a unique feel. However, I am concerned it may emphasize the "foreign nature" of our site and affect our conversions. So far our conversion rate do compare favourably with other busineses i.e. 1-3% depending on the type of traffic

I would be very interested in your opinions on this matter.



 7:33 am on Jun 5, 2004 (gmt 0)

Go withthe flow, display the price of your goods like everyone else.

A chainstore in te UK (Woolworths) carried out a similar exercise on price display and found customers prefered the X.99 - which resulted in more sales.

Strange but true.


 6:14 pm on Jun 5, 2004 (gmt 0)

Essex_boy: Not only that, there have been studies conducted in the US that show customers will perceive a price ending in .99 as a better (& lower) price, than an actual lower price ending in round numbers. Seems the US consumer is so used to seeing sales prices, in particular, ending in .99, their system is wired to respond to that pricing model. Sad, but by some studies true. Just as offering just about anything "free" along with the main item for sale (such as shipping) even when the cost is built into the cost of the product, generates more sales.


 6:23 pm on Jun 5, 2004 (gmt 0)

I had random prices for a product on my website for a few months.

I had

This was how sales ranked:
$5.99 - %35
$9.99 - %25
$7.99 - %15
$10.99 - %15
$8 - %10


 8:13 pm on Jun 5, 2004 (gmt 0)

Interesting figures, people are starnge arent they?

I used to work for a large chainstore, shortly before the sales were brought on several items would double in price.

During the sale you see adverts saying 40 % off of X item in the sale.

Lo and behold theyd sell tons of that item, but it was X% higher than the original price, people have no sense of value.

It used to make me laugh to hear people saying quite confidently that 'you can tell this a proper sale by the prices'. DOH!


 10:46 pm on Jun 5, 2004 (gmt 0)

x.99 pricing has always bugged me, so on my site the price are rounded to the nearest 10 pence.

This has got me thinking now! Maybe I should pay attention to what other people are doing and move to the x.99 style prices...


 2:47 am on Jun 6, 2004 (gmt 0)

Thanks for your opinions, I think we will have to try.

To go further, I wonder is $7.95 better than $7.99, and $7.49 better than $7.50?



 4:00 am on Jun 6, 2004 (gmt 0)

I converted all my even number prices a short while ago, and it appears to be having the psychological effect that is described above. I do not use cents though because my items are higher ticket, but I do now end all prices in five or nine. For example $250 became $249. I may do away with the five endings as well nd just use nines at least for an experiment.


 6:28 am on Jun 6, 2004 (gmt 0)

I don't remember the source, but here is some data:

Up to $10, it's best to keep everything .99 or .98.
There does not seem to be much difference between $4.99 and $4.95, so there is no reason to "waste" a few cents.

Prices over $10 work best with .95 or .75, ie, not .99.
So $14.95 seems to perform better than $14.99.

Over $100, should be flat prices, $149 is better than $149.95.


 4:32 am on Jun 7, 2004 (gmt 0)

Thanks bcc1234. I have updated the prices on our site according to your rules. It would be interesting to see what happens. Since we are entering a quiet phase now, I don't expect anything dramatic.

Personally as a consumer, I find this practice rather dishonest and irritating. For one you have to do more thinking when making a purchase. Also you would end up with a lot of changes in cents and pennies from bricks and morters stores.


 4:47 am on Jun 7, 2004 (gmt 0)

Something else to keep in mind, if you list your products on MySimon, BizRate, etc., using the $19.95 instead of $20.00 will rank you above the compettition that uses $20.00 for queries that rank by price - which is very common.


 2:25 pm on Jun 7, 2004 (gmt 0)

To add to the confusion I read in a marketing book that endings of 77 or infact the use of 7's in general is a boost. A price of $77.77 would then seem to be an optimal price.


 3:27 pm on Jun 7, 2004 (gmt 0)

I agree with DaveNorris.

No 7 is somwhat a magic number. We have a certain line of items priced at 7.00

They outperform many other items in the same price range.


 4:08 am on Jun 8, 2004 (gmt 0)

Yes Walmart, had the tencancy to list everything ending in .97, so they must have done some consumer research. Just copy the big boys.


 5:39 am on Jun 8, 2004 (gmt 0)

This is a long-studied topic in B-School academia. Here are some study results found at random in SERPS:

New Zealand Study:

USA Study:

Good Bibliography:

Just a little friendly bedtime reading (zzzzzz :-)


 6:00 pm on Jun 8, 2004 (gmt 0)

I was always under the impression that the main reason why articles are priced at $9.99c or $9.95c is so that the sales assistant is obliged to give change, and hence open the till and issue a receipt. That is, not be able to pocket a round $10 or whatever.


 6:20 pm on Jun 8, 2004 (gmt 0)

With Sales tax, at least in the US, nothing ever comes out even. Something priced at $10.00 would be from $10.50 to $10.83 or more depending on the state or city where the purchase was made. When I was doing a lot of show vending where people used cash, I would adjust the prices so that they would total to a nice even number after the tax was added. This allowed me to not have to deal in change. I usually made sure that the price ended in either 5 or 0 so I didn't have to deal with $1 bills either. Makes it easy to check a lot of people out quickly.


 6:28 pm on Jun 8, 2004 (gmt 0)

I have also heard that ending in '7' helps for some reason.

There are a few reasons for using obscure ending amounts:

1) Consumers (in general) view $9.99 as similar to $9.00, but view $10.00 as in the 'next price bracket up'

2) Some shops with sales reps use the cents (or pennies) column to tell the rep about the product. So a product ending in '99' would be a normal stock item, '98' could mean a commision bonus to the rep, '97' may mean discontinued product line (so they know no more will be coming in if out of stock) etc...

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