Ever seen those price tags that end with the digit 9? Sure you have! Around 60% of all retail prices end with this number. Why? Who started it? No one knows for certain.
But what we know, and marketers and economists agree on, is that ending a price with this number tends to increase sale. Maybe it is something that is hardwired in people? Maybe it is the psychology, the comfort of staying within a two digital price tag.
Surely a price of $99 seems just that little bit better than $100.
Interestingly, a few MIT folks decided to go for some empirical evidence. This study is somewhat old now, from 2003, but is still relevant. They basically used a mail order company that sold women’s clothing to price the same item at three different price levels — that is $34, $39 and $44.
No prizes for guessing what price tag outsold the other!
The $39 price beat the other two, by margins between 15% and 30%. This is worth a paraphrase. The same product sold more units at $39 than it did when it was priced $34. So there definitely is some psychology involved here.
And that is one reason why many online marketers price their products at either $9, $19, $29 or $49. It is not a hard and fast rule, but if it works for you, then go for it.
Here is the link to the PDF file about the effects of prices that end with $9.