How come stores and buisness charge for things for some amount of dollars and then .99 cents? Why don't they just round it up to the next dollar?
2007-03-21 11:58:39 · 20 answers · asked by Max M 1 in Business & Finance ➔ Other - Business & Finance
The reason is that consumers often focus on the $ instead of the cents. While they want to get $4, for instance, they will price it at the magic price of $3.99. Often they will use other amounts like 88 cents or 97 cents. Usually, sellers will try to gimick the price of big ticket items such as autos and homes, but then there will be a bigger gap; e.g., instead of charging $25K for an auto, they will price it at $24,500, instead of $300K for a new home, they will list it at $297K.
2007-03-21 12:05:02 · answer #1 · answered by Scott K 7 · 0⤊ 0⤋
People read left to right so by doing .99 it gives the illusion that it is a dollar cheaper than it really is.
2007-03-21 12:02:30 · answer #2 · answered by Dan J 4 · 0⤊ 0⤋
Because even though you dont notice it, your brain interprets it as a lot cheaper than $1.00, since it has two digits. Your brain also picks up on words too, but sometimes its vis-versa. For example, when you write it out nintey nine cents looks more costly than one dollar. Its just how our brain works.
2007-03-21 12:02:34 · answer #3 · answered by Anonymous · 0⤊ 0⤋
It's a selling tactic. Things that are priced at for example $2.99 look a lot cheaper than something that is $3.00 when you are just glancing at it, so people are more willing to buy things then.
2007-03-21 12:01:50 · answer #4 · answered by Anonymous · 0⤊ 0⤋
Because it sounds cheaper
Actually studies have shown that amounts ending in 7 are the most effective.
2007-03-21 12:01:53 · answer #5 · answered by Biz Guru 5 · 0⤊ 0⤋
This makes people believe they are getting more of a bargain. Saying it is under a buck makes people pay attention. It's all about pricing points.
2007-03-21 12:00:50 · answer #6 · answered by Anonymous · 0⤊ 0⤋
it is a stategy in selling. i studied this stategy in business and it makes customers think they are paying less. for example if a table costs 499.99 it looks for appealling than 500. something to do with the subconcious of the mind. it was a while ago i studied business.
2007-03-21 12:05:58 · answer #7 · answered by soozet01 2 · 0⤊ 0⤋
Because 99cents SOUNDS less than 1 dollar...its a marketing teqnique.
2007-03-21 12:01:07 · answer #8 · answered by Lal 4 · 0⤊ 0⤋
because it seems as though it is cheaper then a dollar. everyone connates cents as cheap and dollars as expensive.
2007-03-21 12:01:03 · answer #9 · answered by Pistol Pete 3 · 0⤊ 0⤋
because people are stupid and consumers see $2.99 and think it's a lot less than $3.00. Sad but true.
at least advertising execs are smart enough to exploit our gullibility ;)
2007-03-21 12:02:26 · answer #10 · answered by imnotachickenyoureaturkey 5 · 0⤊ 0⤋