Why are things still priced at 1.99$?

[exigeracer]

I understand that pricing something 5.99$ is playing on the subconscience by enticing the consumer to believe the product is actually somewhere in the 5-dollar range, when in essence it's pretty much 6$. Don't you think the trick has gotten pretty old and people have started to realise that rounding up that one penny isn't so hard to do?

It's a trick, and I'm a relatively young consumer, and I've already caught on, so I'd imagine others have too. When will it get "old"?

 

[Sakiale]

Um... I don't know. It's never fooled me.

Also, the penny that I get back is annoying because usually I just drop it somewhere or lose it.

 

[Sage]

Actually, it’s a trick that works better than you think. For instance, at my school’s dining hall, there might be a main entree that costs $4.95, with two sides for $1.90 – despite of how aware I am about the .9 factor, I still get caught off-guard when I realize that I just spent nearly seven bucks, because I always forget to round up both numbers.

 

[wfooshee]

Same with gas prices, with that 9/10 of a penny on the end. 3.09.9 instead of 3.10!

 

[Diego440]

It also works when some products are fixed on having to be below a certain price, so they just put the previous number, .99.

 

[exigeracer]

But that's not why most products are priced just below the whole dollar.

Sage, it doesn't fool you if you've bought the second Chevy for 16,995$, now does it?

 

[niky]

It's the whole reason. That marketing trick works better than you think. Even if most of us have caught on to it, already, it still works on most of the mindless drones who buy stuff, so it stays.

 

[Philly]

I think it is because subconsiously we will still think the price is lower than it really is. Only when we think about it do we remember to round up.

 

[Turbo Lag]

Ok i got another question to do with this. So i go to Coles or some supermarket and when you pay, does the total you pay round up to the total you pay, or does it round to every product you pay (Making you spend more)???

eg. I buy 10 items @ $4.99 each. And does total come to $49.90 or $50?

 

[Wenders]

Ok i got another question to do with this. So i go to Coles or some supermarket and when you pay, does the total you pay round up to the total you pay, or does it round to every product you pay (Making you spend more)???

eg. I buy 10 items @ $4.99 each. And does total come to $49.90 or $50?

The total would be $49.90. At the supermarket they use whatever the real price is. They then round the total up or down depending on what it is. 1c and 2c goes down , 3c & 4c up to 5c, 6c & 7c down to 5c and 8c & 9c up to the next 10c and that is only if you are paying cash, if you use credit or EFTPOS then they charge the actual amount.

 

[TheCracker]

Also, if you see something priced at say £8 it could make you think 'now wait a minute, how did they get to that nice round figure? - they've probably just rounded the figure up' £7.95 at least looks like it might be the price it costs to manufacture, market and distribute the product.

But no it is the fact that £7.xx will always look much cheaper than £8, even if it is only 5 or 1 pence cheaper.

 

[Casio]

I love my local supermarket. With awesome prices and discounts like these...

$2.42 is way too expensive for me, but $2.37 on the other hand....The ironic thing is it probably cost them more then 5c per packet to print those out and the worker hours to put them up....

 

[Metar]

Good one, Brad 👍

Actually... In Israel we don't have a '1p' equivalent - the lowest is the equivalent of 5 pennies (though, our 5 "Agorot" are worth as much as one penny anyways), so stores round it up - for 1.96 you'll still pay 2. However, the supermarket stores got into big troubles a couple of months ago, under suspect of tax-fraud. Turns out the machines still register the income as "1.99" rather than the actual "2" that was paid - while that's only a penny, according to calculations, that turned out to be a couple of millions worth of taxable income.

 

[Turbo Lag]

The total would be $49.90. At the supermarket they use whatever the real price is. They then round the total up or down depending on what it is. 1c and 2c goes down , 3c & 4c up to 5c, 6c & 7c down to 5c and 8c & 9c up to the next 10c and that is only if you are paying cash, if you use credit or EFTPOS then they charge the actual amount.

So basiclly Credit Card or EFTPOS would be cheaper? But EFTPOS charges about 20C extra on (correct?) every use so on small buys the EFTPOS would be more expensive but on a large buy about $100 it makes up for the 20C extra it costs? (am i right?)

How come that on ad's they show like a product and say: UNDER $30!!!!!! And then you find out its $29.99 () Is that even legal?

 

[Duke]

eg. I buy 10 items @ $4.99 each. And does total come to $49.90 or $50?

The total would be $49.90. At the supermarket they use whatever the real price is. They then round the total up or down depending on what it is. 1c and 2c goes down , 3c & 4c up to 5c, 6c & 7c down to 5c and 8c & 9c up to the next 10c and that is only if you are paying cash, if you use credit or EFTPOS then they charge the actual amount.

Wow, in the US, it's just the sum total of whatever the actual marked price is, no matter if you're using cash or credit or debit.

 

[exigeracer]

Plus my 15% sales taxes FTW!

 

[Agent Smith]

Maybe it has something to do with the fact that the copper industry's revenue for the year 2006 was approximately $4,550,000,000 ?

 

[Wenders]

So basiclly Credit Card or EFTPOS would be cheaper? But EFTPOS charges about 20C extra on (correct?) every use so on small buys the EFTPOS would be more expensive but on a large buy about $100 it makes up for the 20C extra it costs? (am i right?)

How come that on ad's they show like a product and say: UNDER $30!!!!!! And then you find out its $29.99 () Is that even legal?

You shouldn't be paying any extra to use EFTPOS and if you do you are banking with the wrong bank, as an under 18 year old shouldn't be paying any fees at all on a bank account.

Wow, in the US, it's just the sum total of whatever the actual marked price is, no matter if you're using cash or credit or debit.

The smallest denomination coin we have is 5c. That's why we round up or down if paying cash.

 

[Turbo Lag]

You shouldn't be paying any extra to use EFTPOS and if you do you are banking with the wrong bank, as an under 18 year old shouldn't be paying any fees at all on a bank account.


The smallest denomination coin we have is 5c. That's why we round up or down if paying cash.

I dont use or have an account with the bank. I was just wondering whether it does have a small charge

 

[Wenders]

I dont use or have an account with the bank. I was just wondering whether it does have a small charge

OK, well some banks have limits on the number of transactions you can make so I guess if you use lots of EFTPOS then it may end up costing you more in bank fees but the store should never charge you extra for using it. The retailer pays a fee to the bank to use it which I am sure is passed on to shoppers in the prices we pay but it's a price everyone pays not just the user.
Some retailers will charge extra for credit card purchases usually from small businesses who don't do a lot of credit card transactions and would have to pay higher fees to their bank to have credit card facilities.

 

[Casio]

OK, well some banks have limits on the number of transactions you can make so I guess if you use lots of EFTPOS then it may end up costing you more in bank fees but the store should never charge you extra for using it.

I think you have to use a hell of a lot of EFTPOS to start paying. My last monthly statement I used it 33 times and it didn't cost me.

Some retailers will charge extra for credit card purchases usually from small businesses who don't do a lot of credit card transactions and would have to pay higher fees to their bank to have credit card facilities.

A few places now are charging you 10% extra just to use AMEX.

 

[Pupik]

Although I've long thought the x.95/x.99 trick would have disappeared by now, it does look weird when you go to a restaurant or store and they post prices of, say...$8 or $12. Even when you look at big-ticket item like a home for sale, it's $399,990 or $479,990.

I can only assume this old "trick" will be around for many decades to come...

 

[Omnis]

We have 6 cent tax here, so I thought $.95 prices were to make it easy to just pay a buck and a nickel. instead of worrying about pennies.

 

[Dougboy]

Im not complaining. Here in Canada, we have a provincial tax and a federal tax. The two taxes together is 14%. But for items under $4, i only have to pay one tax which is 7%

So a $3.99 meal only cost me $4.27 with tax because 3.99 is under $4

 

[Matt R]

It's funny watching infomercials and the host tells you, "You can get all the stuff you see here for under $50!!! All you pay for this amazing product, is $49.99!"

I wonder how many people actually think they're getting a steal of a deal.

 

[exigeracer]

Interesting BB - I didn't know that.

The Quebec government is shafting the federal gvernment and its taxpayers by forcing the sales tax on top of the sale price and the federal tax, instead of both on the sale price like in all other provinces. Lame.

 

[Tulok]

no packaged food tax in Cali "score!"
but yeeah, 54.11 for a 49.99 game...is an ok deal ish
I think that when its .99 or .95 it confuses you enough to make you think it will
A. actually end up costing less
or
B. make you get it anyways becuase it is hard to math it

 

[Gonz013]

In Australia, they have got rid of 1 and 2 cent coins years ago, so everything is meant to be rounded off to multiples of 5 cents, but prices like $7.32 etc. are still common.

I noticed that a lot of these 'illogical' prices were set up to round down, rather than up. I wondered why they would bother- until I saw my credit card receipt. 💡 Reason?: If you use a credit card, they charge you the exact price ($7.32, not the $7.30 if you paid cash).

By adding a couple of cents to a Recommended Retail Price (RRP), they can pick up that little extra per transaction, without going over the RRP (sort of) set by manufacturers/ producers, and still be able to claim equal pricing.

Psychologically, if the store added 3 cents and rounded up for cash transactions, they might set a perception/ reputation in customer's minds of being more expensive than their competitors, who might stick closely to the RRP.

So, particularly for big chains of stores, adding an extra 2 cents for every item can add some profit, seemingly from thin air!

 

[Turbo Lag]

In Australia, they have got rid of 1 and 2 cent coins years ago, so everything is meant to be rounded off to multiples of 5 cents, but prices like $7.32 etc. are still common.

I noticed that a lot of these 'illogical' prices were set up to round down, rather than up. I wondered why they would bother- until I saw my credit card receipt. 💡 Reason?: If you use a credit card, they charge you the exact price ($7.32, not the $7.30 if you paid cash).

By adding a couple of cents to a Recommended Retail Price (RRP), they can pick up that little extra per transaction, without going over the RRP (sort of) set by manufacturers/ producers, and still be able to claim equal pricing.

Psychologically, if the store added 3 cents and rounded up for cash transactions, they might set a perception/ reputation in customer's minds of being more expensive than their competitors, who might stick closely to the RRP.

So, particularly for big chains of stores, adding an extra 2 cents for every item can add some profit, seemingly from thin air!

Correct about the credit card thing but it can work in your way too