the 99p effect...

[ally_1988]

Hi Everyone,

I'm trying to get some input on how important as a consumer you feel the 99p effect is.

Hypothetical situation... You had a really good product that if bought would save a customer at least £100 in a year. Obviously that in itself is a massive selling point, so do you need to make us of the 99p effect?

Would you sell your product at £5 or £4.99?

I've seen mixed opinions in articles...many saying that it is still a very effective tactic, but then I have also read quite a few articles which say the common use of the 99p tactic is frustrating to customers.

I'm interested to find out what you think.

 

[Cybamart]

Hi, I've always preferred £0.95, I don't know why I think it looks more enticing than £0.99 though. And it works for Asda - practically their whole shop's stock ends in £0.97 for a reason.

 

[Jeff FV]

There was a pound shop in Poole that went bust when a 99p shop opened over the road:

http://www.telegraph.co.uk/finance/...shop-forced-out-of-business-by-99p-store.html

 

[ally_1988]

haha, that is actually quite funny.

I accept that it does seem to have an influence, but would you always adopt it regardless of other factors (like the situation given above)?

If you are already providing value for money, then surely a customer will see that? Or is that 1p/5p going to make all the difference?

 

[jelly3]

Hi Everyone,

I'm trying to get some input on how important as a consumer you feel the 99p effect is.

Hypothetical situation... You had a really good product that if bought would save a customer at least £100 in a year. Obviously that in itself is a massive selling point, so do you need to make us of the 99p effect?

Would you sell your product at £5 or £4.99?

I've seen mixed opinions in articles...many saying that it is still a very effective tactic, but then I have also read quite a few articles which say the common use of the 99p tactic is frustrating to customers.

I'm interested to find out what you think.

You forgot the 95p effect also.
I would rather go with £4.95 or £4.99 rather than £5.
It is psychological, people always assume they are getting a bargain.

 

[vvaannmmaann]

haha, that is actually quite funny.

I accept that it does seem to have an influence, but would you always adopt it regardless of other factors (like the situation given above)?

If you are already providing value for money, then surely a customer will see that? Or is that 1p/5p going to make all the difference?

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Today, 17:32
[FONT=verdana, geneva, lucida, arial]ally_1988[/FONT]

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I think I might start more posts where I ask a question in a very unclear fashion and then go on to answer it myself.

​

Pot.Kettle.Black.

 

[kjmcculloch]

I don't think that the .99 or .95 is as important now as it once was. Personally I would stick to the round pound like Iceland do. I always think I'm getting a deal at Iceland when things are only a pound, or only £3. I could probably get the item cheaper elsewhere but I think the shorter £2 than £1.99 is more enticing to me.

Kris

 

[Beachcomber]

The 0.97 effect is a powerful one.

I believe the unusual number indicates a discounted price - offers where 10 / 20 / 35% is knocked off often results in an odd pence amount hence the 97p price is seen as indicative that a discount has been applied to the standard / original price.

 

[MASSEY]

I much prefer to see £1

I think they should get rid of pennies, they are just a waste of time.

 

[freeroam]

Well it worked for me. When I started 99p hosting plans rather than £1 or a touch over, my customers shot up...

I'd say the 99p effect still works, some of us just like to think we've outgrown it and it doesn't .

 

[ally_1988]

vvaannmmaann - always controversial - but fair enough, I deserved it.

Although I don't think I really answered my own question although it possibly could have been clearer in the first place.

I might attempt a full and complete answer later on. Although It's quite a difficult one to answer it seems.

the classic £1/99p/97p/95p .....there seems to be quite a few different opinions.

Personally I would go with Massey and say I prefer things to be nice round figures - change is just a pain.

I was reading an article earlier saying we throw away something like £133 million a year in coppers. Guess it's true what they say "Look after the pennies and the pounds will look after themselves"

 

I was reading an article earlier saying we throw away something like £133 million a year in coppers. Guess it's true what they say "Look after the pennies and the pounds will look after themselves"

Thats a very old saying.:|

And like a lot of old sayings is rubbish.

I prefer "look after the pounds and sod the pennies cause you can't buy nothing with one.

Earl

 

[estwig]

Thats a very old saying.:|

And like a lot of old sayings is rubbish.

I prefer "look after the pounds and sod the pennies cause you can't buy nothing with one.

Earl

Not sure about that, some old saying can be lucky, one of my favourites

Find a penny, pick it up and if your lucky, you'll get a .......

 

[Sobie]

We've been experimenting a bit in our shop with rounding a couple of our prices up by the penny and keeping some prices at the 99p/49p points.

Can't say we've noticed any difference in sales.

However about 1% of our customers say "keep the penny/ put the change in the charity box" the rest always take the 1p (or whatever pennies the change is). so if customers want the change, then they must want the 99p price point.

It really does depend on the product and I think it is best to do just one of the methods as customers can get confused when I charge £2 for one plant and £1.99 for a simular plant.

I would like to remove the 99ps as I hate having to get so much change from the bank! In our busy season I can get through about £20 in 2ps & 1ps a week. So I'll be reading this thread with great interest.

 

[deniser]

I think charities rely heavily on the 1 and 2p change. I always put any coppers into the nearest charity collection tin as I don't like them weighing down my purse!

We use the .99 on everything. There is a huge psychological difference in the customer's eyes between £29.99 ie. twenty something pounds and £30.

 

[Naughty Vend]

There was a study done many years ago on this subject and the results were linked to "physical size" of the price in the eye of the mind, for example in bingo two fat ladies is... eighty eight, 88.

That means 87 is a fat lady and a skiny lass in a dodgy hat then?

Nope, the answer is that your brain fills in the space inside the eight and it blocks out more area so appears larger not just in physical relation but in psychological relation and therefore a price ending in seven is much smaller than a price ending in eight or even nine, although just a penny or two different. We tried this on quotations for contract cleaning in the 90's as two or sometimes three different companies tendering, the quote with "skinny" figures nearly always won the business...

What's a bigger number £71.97 or £68.99 and in the numerically larger price which individual number stands out to you if you stare at it?

 

[ally_1988]

I was looking at some more articles on this last night. A couple of articles suggested that by adopting such a strategy sales of your products could increase by up to 15%. I find that pretty amazing!

Also with regards to my other part of the question. Would you always adopt this strategy, simply because of it's proven success? Or if like I mentioned earlier you had a product which had a very good selling point (e.g buying a product at £5 would guarantee to save you at least £60 over the year) would you stick to a round figure or still go with the 'skinny figures'?

 

[buyfromtheuk]

There was a study done many years ago on this subject and the results were linked to "physical size" of the price in the eye of the mind, for example in bingo two fat ladies is... eighty eight, 88.

That means 87 is a fat lady and a skiny lass in a dodgy hat then?

Nope, the answer is that your brain fills in the space inside the eight and it blocks out more area so appears larger not just in physical relation but in psychological relation and therefore a price ending in seven is much smaller than a price ending in eight or even nine, although just a penny or two different. We tried this on quotations for contract cleaning in the 90's as two or sometimes three different companies tendering, the quote with "skinny" figures nearly always won the business...

What's a bigger number £71.97 or £68.99 and in the numerically larger price which individual number stands out to you if you stare at it?

So is a skinny looking £100 better than charging £8.88

 

[Sobie]

I'm thinking about everything under £4 being a round number and everything above being an 97p.

Of course with VAT rising to 20% I might just add the extra VAT on so they will all be weird skinny prices anyway

 

[Sobie]

So is a skinny looking £100 better than charging £8.88

those zeros look very fat to me

 

[buyfromtheuk]

those zeros look very fat to me

True but the diet is going to cost ya; £11

How about £111 Vs £8.88

 

[KidsBeeHappy]

When ROI went over to the Euro, it simultaneously ditched all the penny pricing. Just a case of one hastle too many I think. So things that were £15.99 became 20Euro. And the vast majority of shops selling things like clothing etc simply stopped pricing with the pennies.

I don't think anyone complained.

 

[Naughty Vend]

So is a skinny looking £100 better than charging £8.88

Well if you are looking for a ridiculous answer to match a ridiculous statement then yes charging one hundred pounds is better than charging just under nine, on the provisio somebody buys and pays for the item... because you'd make more money. Obviously, pah...

On the other hand I think we are talking about figures in a similar region but within reason as per the example shown.​

 

[Naughty Vend]

True but the diet is going to cost ya; £11

How about £111 Vs £8.88

By the way, your link Shellmania under Adult Merchandise is "404" and has a spelling mistake in the listing regardless... as 'cheep toys and great deals' are a whole different type of adult product.

Should have paid your proof reader a fat figure hourly rate.

 

[jelly3]

Not sure about that, some old saying can be lucky, one of my favourites

Find a penny, pick it up and if your lucky, you'll get a .......

:|Book? Duck? A good deal at the local chip shop?

 

[matt.chatterley]

There was a pound shop in Poole that went bust when a 99p shop opened over the road:

http://www.telegraph.co.uk/finance/...shop-forced-out-of-business-by-99p-store.html

The same thing happened here in Jersey, more or less..