We all know that $10.99 is basically the same as $11, but we still like the second option more. It’s literally everywhere and not even a trick. How can it be one when everybody knows how it works? But still, businesses are doing things, and everyone is here for not paying a CENT more. Well, let’s figure this stuff out. Why does it work like that, and why we’re buying it? We’ll try to explain.
Why Is Everything Always $9.99?
Look, when you’re scrolling an online shop, you always see something like $49.99 on any stuff, right? Even things like toothpaste or coffee pods follow the same pattern (so predictable), but we keep begging them to take our cash. And it isn’t even necessary. For example, raizer.dk never used it, and people still pay, right? Well, even when we’ve seen it a hundred times — it still feels like a deal, and it actually is. Funny, but if we compare, $9.99 is better than $10. Not much, but still.
This pricing tactic has been in use for over 100 years and started showing up in newspapers in the late 1800s. Back then, it was mostly about making sure cashiers gave change instead of pocketing bills. Then it got deeper, as marketers tested it a billion times and quickly figured out that it’s a good plan for selling ’cause it’s not only working on cashiers.
And no, it’s not outdated. Not even close.
It’s still works ’cause our brains haven’t changed even a bit. We still read from left to right and make snap judgments too fast. Our brain sees $9 and doesn’t care that it also has a point and some other numbers after it.
A Bit of History
Cash registers were quite a new thing in the early 1900s. So, when a customer handed over a dollar bill for an item that cost, let’s say, 75 cents, the clerk had to take their cash and record the sale. Store owners started using prices like $0.99-1.99 to basically force clerks to open the register to stop theft. Well, it’s only a theory but a strong one. If something cost a clean $1, the temptation was there just to pocket the bill and never log the sale. But if it costs $0.99, the clerk had to open the till to give back a penny.
It made goodies look cheaper over time. Come on, look at Shein! It already has a super low price and still uses this strategy. And what do we do? We buy.
Where .99 Doesn’t Work and Can Actually Backfire
Well, it’s not a magic trick to work everywhere. For example, it doesn’t work with luxury stuff. If you see that the new iPhone costs $1,199.99 instead of $1,200, it definitely won’t make the price look better. Quite the opposite, actually. Yeah, we said earlier that our brains see the first number of a price and couldn’t care less about its other numbers, but it still grabs the whole picture. So, if we see that the price is too long (doesn’t matter if it’s only cents), it immediately becomes unattractive for our wallet.
Moreover, if we’re shopping for luxury, the cheap vibe kills the mood. We’re obviously here not for saving. Huge brands despise this trick, as it can make them look like they’re trying too hard to sell.
In Asia, ending prices in odd numbers can feel unlucky or just plain tacky. What works in a U.S. supermarket might look totally off in a Tokyo showroom.
Other Sneaky Pricing Tricks
The $0.99 has besties like $0.95 and $0.49, also known as “charm pricing”. Same idea as .99, just wearing a different disguise, as the goal isn’t the same. Look, $4.45 just looks nicer, but $4.97 is for signaling about special pricing, as it is associated with profitable deals.
It’s only a bunch of cents, but we also got price bracketing. A $99 one feels like the “smart” choice. What we don’t see is that the $149 product might just be there to make the $99 one look even more attractive.
That leads us right to the decoy effect, and this one is clever. A company offers three versions of a product: basic, premium, and smack in the middle. The expensive one might not even be meant to sell. The store needs it to steer us, and suddenly, the middle one looks like the best choice, and you’re lucky you found it. We’re sorry if you thought you were spending rationally, but don’t worry. No one was.
The Real Takeaway
Okay, now you know where this stuff came from and have more chances to avoid unnecessary stuff. Well, there is no guarantee, as our brain lives its own life, and if it thinks you won’t do something more profitable — you’re stuck. Talk to yourself and make you believe that there are tons of different products in your town just for you. If you don’t buy something today, you’ll get it tomorrow.