7 ms·

Retailers don't do this because of published studies. They do it because they've tested it internally for the last 40 years.

throwaway13337 2y ago
That may be true but we don't know that it is true. When I started my selling software, I priced with something.99 too. I did this because everyone else did. I was unfamiliar with these sorts of things so I followed on. I am sure that in some business at some point, there was a big positive in switching to that sort of pricing. When I switched my software to whole numbers, I did not notice a drop in sales. Things continued to grow. Of course, my business is one data point and a small one. How much of why we tend to do this is because, historically or normally, that is how we've seen it done?
- elevatedastalt 2y ago
  what sort of software were you selling? Was it an app that is priced under 10 bucks? That would be very different from some enterprise software costing $500.
- ksec 2y ago
  Because you are selling software and your target audience are either business, enterprise or computer engineers. The trial of whole number pricing keeps coming up in Consumer and Retail every 10- 15 years and EVERY time the test shows .99 works. Despite how most of us and even my younger self hated it.
  - satvikpendem 2y ago
    Indeed, marketers aren't stupid (but it turns out people in general are stupid, enough to fall for this trick and many others).
    - Nevermark 2y ago
      When it is so well known, at some point it isn’t a “trick” anymore, right? It isn’t as if retailers can fight reality. Or that they can “come clean” by putting fine print under prices explaining why they are ending prices in 9. Which would create a major distraction messing with any sale. It is just real-world reliable wackiness that both sellers and purchasers should be aware of. There is no purely objective way to relate to selling and purchasing prices. Short of very simple scenarios where a spreadsheet actually captured all the real criteria. Many products make people happier if the price is higher. Is that happiness bump a fraud, or the point? Just remember to ask for $199,999.99 salary in your next interview!
      - satvikpendem 2y ago
        > Or that they can “come clean” by putting fine print under prices explaining why they are ending prices in 9. Which would create a major distraction messing with any sale. Why would they do that? That might lessen their sales if people knew of the effect, as a nocebo.
        Nevermark 2y ago
        I agree(d). > Which would create a major distraction messing with any sale.
      - pempem 2y ago
        As you consider the issue this phrase I think is the best synopsis of your thoughts: When it is so well known, at some point it isn’t a “trick” anymore, right And yet we fall for the same tricks again and again. The most politically pressing? The number of people - internationally - who believe in a strongman leader. MLMs also occur to me. We know MLMs so well that we've literally written laws against them. There are movies, articles, conversations. And yet, every single year, tons of people fall for them. What other very well-known tricks do people fall for HN?
        distalx 2y ago
  - theshrike79 2y ago
    The .99 thing is like the placebo effect. Both work despite people knowing they exist.
- indymike 2y ago
  > That may be true but we don't know that it is true I think a walk through a shopping mall might provide some clear evidence.
  - qup 2y ago
    It'll provide evidence that they've studied it internally? I don't think so.
    - indymike 2y ago
      > I don't think so. OK.
      - swores 2y ago
        They were being polite because you were flat out wrong: a walk through a shopping centre gives you absolutely zero information about whether prices chosen have been tested or were picked by throwing darts at a calculator. It just tells you what prices those shops have chosen to sell things for, nothing at all about the reasoning behind those prices.
        qup 2y ago
        In fact it seems really bad logic to assume that they would all arrive on the same price, had they actually done any real study. There would be some outliers or weird niche customer populations.
        jamiek88 2y ago
        Logic doesn’t explain human actions. And never will.
        qup 2y ago
        That's a non sequitor, as I'm not trying to explain human actions at all in this case.
- kevin_thibedeau 2y ago
  The final answer here gives clear indication of psychological bias toward left digits: https://skeptics.stackexchange.com/questions/2359/the-origin-of-99-cents https://skeptics.stackexchange.com/questions/2359/the-origin...
mcmoor 2y ago
I thought it's notorious that sometimes they also don't know what they're doing, being carried by trends and vibes. "Half the money I spend on advertising is wasted; the trouble is I don’t know which half"
- chrisjj 2y ago
  The advertiser who knows half his spend is wasted is the one who /does/ know what he's doing.
  - Hasu 2y ago
    Yes, that's the point of the quote, but the point of the poster you're replying to is that wasting half your budget would be considered gross incompetence in any other department. "Half the lines of code I write are useless, I just don't know which half." - an incompetent coder "Half the time I spend on the phone is wasted, I just don't know which half" - an incompetent salesperson "Half of my menu is inedible, I just don't know which half" - an incompetent restauranteur
    - tpmoney 2y ago
      I don't know, you see plenty of people stating they only do X hours of real work in a given day. That sounds an awful lot like the same basic idea. If I think about it too, half the lines of code being wasted is probably a relatively reasonable measure for writing code. Not because they're actually literally useless, but because you write a lot of scaffolding, a lot of first passes and a lot of code that will be a dead end or superseded before you're done. If you knew before you started exactly what lines of code you'd need to write, you'd be much more efficient, but we don't, so we write a lot of "waste" code too.
    - chrisjj 2y ago
      > the point of the poster you're replying to is that wasting half your budget would be considered gross incompetence in any other department. Not if there too a spend of X was required to get the value of X/2.
    - 2y ago
TaylorAlexander 2y ago
Sure but should we believe that internal studies at retail chains are quality scientific studies?
dfox 2y ago
Well, it is tested internally for at least 100 years: https://en.wikipedia.org/wiki/Tom%C3%A1%C5%A1_Ba%C5%A5a https://en.wikipedia.org/wiki/Tom%C3%A1%C5%A1_Ba%C5%A5a
subroutine 2y ago
And many physicians still recommend putting ice on sprained ankles 5x per day to reduce the “harmful” swelling. Even though the abundance of research now shows icing delays the infiltration of proteins, hormones, and cells that aid in healing processes (and can even cause further tissue damage). Practices like this stick around because of the desire to be seen making proactive recommendations with putative benefit. With the dresses there is clearly something odd happening. In all cases except one the cheapest dresses sold the fewest items even compared to ones that were $10 more expensive.
- Ctyra 2y ago
  > Even though the abundance of research now shows icing delays the infiltration of proteins, hormones, and cells that aid in healing processes (and can even cause further tissue damage). Do you mind sharing any references
  - compressedgas 2y ago
    https://drmirkin.com/fitness/why-ice-delays-recovery.html https://drmirkin.com/fitness/why-ice-delays-recovery.html
- mhb 2y ago
  When I was looking for evidence about the efficacy of ice to speed recovery, I found it very challenging. I would be grateful if you could share some of the abundance.
- amelius 2y ago
  The human body (through evolution) only cares about long term effects for the human species. The actual human might care about pain. Therefore, I don't think that the advice is necessarily bad. Evolution isn't always our friend. There are many examples where our bodies work against us, only to help us evolve better as a species.
- dennis_jeeves2 2y ago
  >Practices like this stick around because of the desire to be seen making proactive recommendations with putative benefit One manifestation of this phenomenon in it's extreme form is cancer diagnosis and treatments. Barring a few exceptions, most cancer treatments are useless.
ChrisMarshallNY 2y ago
Yup. It's been settled lore, for retailers, as long as I can remember. I don't think they care about metrics. That doesn't cheapen metrics, however. Some pretty meaningful (and, often, annoying) stuff has come from them.
phito 2y ago
Yep it's not science, but engineering
agumonkey 2y ago
Reminds me of people who tried selling sturdy repairable phones with longer battery life. Even when people complained about battery issues etc. They kept buying the thinnest flagship. Mass markets are mass market.
- chmod775 2y ago
  > Reminds me of people who tried selling sturdy repairable phones with longer battery life. My brother buys these. They survive up to a year in his "care", rather than the usual 3-4 months of flimsier phones. They all end up with cracked screens within months though. Almost no mainstream consumer electronics nowadays are meant for people who lead active lives (outside of planned and streamlined activities like going to the gym or running) - because the people as a whole generally don't live active lives. If you happen to be an outlier, making your phone survive becomes a serious logistical issue. Sadly carrying one is a necessity in this day and age. Another example: Many offroad vehicles/trucks nowadays won't survive days of the advertised use-cases without serious damage and are often utterly unsuited for it (the cybertruck isn't an outlier here). These things are being sold to people who like to play pretend. Manufacturers cross their fingers and hope you don't actually. Notable exceptions to the rule are things like satellite communicators and some dedicated GPS map devices. They seem to have no issue surviving many phones with their own screens and functionality intact. Their manufacturers know you wouldn't buy them if you didn't plan to use them in the advertised conditions.
  - dieselgate 2y ago
    Indeed, regarding watercraft have seen it as “you don’t sell the boat you sell the dream”
  - ThrowawayTestr 2y ago
    Get your brother a glass screen protector for his phone. I haven't cracked a phone screen in a decade yet I've gone through many cracked screen protectors.
    - chmod775 2y ago
hulitu 2y ago
For me 9.99 is 10. I don't know what they tested, but maybe they shall test again.
- feetsoup 2y ago
  That's easy to say, but when it comes to shopping at the store, picking up several items and not actively thinking about it, are you really sure you aren't unconsciously interpreting that 9.99 differently from 10? Personally, I like to think that doesn't work on me, but at the same time I've caught myself saying something was '9 dollars' when I've been distracted and it was in fact 9.99. And even if 9.99 really is 10 for you, it could mean that you're different than most people, rather than the methodology being faulty.
  - johnisgood 2y ago
    I found it odd that my girlfriend would say out the cents, because personally I have always been rounding up, and never considered the cents, for example.
    - HocusLocus 2y ago
      I try to keep two things in my head when filling a grocery cart, an accurate tally of dollars and a numberless sense of "where in the dollar the cents remainder is presently", like the position of a progress bar on a screen. I find a remembered visual progress bar does not distract me from the arithmetic, and when I spot one of those silly prices ending in .95 or .99 the bar resets to a tiny bit and I add a dollar. My mental progress bar generally jumps in approximate ~1/4 steps and when the total is accurate to within $2 with many items that is a win.

throwaway13337 2y ago

That may be true but we don't know that it is true. When I started my selling software, I priced with something.99 too. I did this because everyone else did. I was unfamiliar with these sorts of things so I followed on. I am sure that in some business at some point, there was a big positive in switching to that sort of pricing. When I switched my software to whole numbers, I did not notice a drop in sales. Things continued to grow. Of course, my business is one data point and a small one. How much of why we tend to do this is because, historically or normally, that is how we've seen it done?

elevatedastalt 2y ago
what sort of software were you selling? Was it an app that is priced under 10 bucks? That would be very different from some enterprise software costing $500.
ksec 2y ago
Because you are selling software and your target audience are either business, enterprise or computer engineers. The trial of whole number pricing keeps coming up in Consumer and Retail every 10- 15 years and EVERY time the test shows .99 works. Despite how most of us and even my younger self hated it.
- satvikpendem 2y ago
  Indeed, marketers aren't stupid (but it turns out people in general are stupid, enough to fall for this trick and many others).
  - Nevermark 2y ago
    When it is so well known, at some point it isn’t a “trick” anymore, right? It isn’t as if retailers can fight reality. Or that they can “come clean” by putting fine print under prices explaining why they are ending prices in 9. Which would create a major distraction messing with any sale. It is just real-world reliable wackiness that both sellers and purchasers should be aware of. There is no purely objective way to relate to selling and purchasing prices. Short of very simple scenarios where a spreadsheet actually captured all the real criteria. Many products make people happier if the price is higher. Is that happiness bump a fraud, or the point? Just remember to ask for $199,999.99 salary in your next interview!
    - satvikpendem 2y ago
      > Or that they can “come clean” by putting fine print under prices explaining why they are ending prices in 9. Which would create a major distraction messing with any sale. Why would they do that? That might lessen their sales if people knew of the effect, as a nocebo.
      - Nevermark 2y ago
        I agree(d). > Which would create a major distraction messing with any sale.
    - pempem 2y ago
      As you consider the issue this phrase I think is the best synopsis of your thoughts: When it is so well known, at some point it isn’t a “trick” anymore, right And yet we fall for the same tricks again and again. The most politically pressing? The number of people - internationally - who believe in a strongman leader. MLMs also occur to me. We know MLMs so well that we've literally written laws against them. There are movies, articles, conversations. And yet, every single year, tons of people fall for them. What other very well-known tricks do people fall for HN?
      - distalx 2y ago
- theshrike79 2y ago
  The .99 thing is like the placebo effect. Both work despite people knowing they exist.
indymike 2y ago
> That may be true but we don't know that it is true I think a walk through a shopping mall might provide some clear evidence.
- qup 2y ago
  It'll provide evidence that they've studied it internally? I don't think so.
  - indymike 2y ago
    > I don't think so. OK.
    - swores 2y ago
      They were being polite because you were flat out wrong: a walk through a shopping centre gives you absolutely zero information about whether prices chosen have been tested or were picked by throwing darts at a calculator. It just tells you what prices those shops have chosen to sell things for, nothing at all about the reasoning behind those prices.
      - qup 2y ago
        In fact it seems really bad logic to assume that they would all arrive on the same price, had they actually done any real study. There would be some outliers or weird niche customer populations.
        jamiek88 2y ago
        Logic doesn’t explain human actions. And never will.
        qup 2y ago
        That's a non sequitor, as I'm not trying to explain human actions at all in this case.
kevin_thibedeau 2y ago
The final answer here gives clear indication of psychological bias toward left digits: https://skeptics.stackexchange.com/questions/2359/the-origin-of-99-cents https://skeptics.stackexchange.com/questions/2359/the-origin...

mcmoor 2y ago

I thought it's notorious that sometimes they also don't know what they're doing, being carried by trends and vibes. "Half the money I spend on advertising is wasted; the trouble is I don’t know which half"

chrisjj 2y ago
The advertiser who knows half his spend is wasted is the one who /does/ know what he's doing.
- Hasu 2y ago
  Yes, that's the point of the quote, but the point of the poster you're replying to is that wasting half your budget would be considered gross incompetence in any other department. "Half the lines of code I write are useless, I just don't know which half." - an incompetent coder "Half the time I spend on the phone is wasted, I just don't know which half" - an incompetent salesperson "Half of my menu is inedible, I just don't know which half" - an incompetent restauranteur
  - tpmoney 2y ago
    I don't know, you see plenty of people stating they only do X hours of real work in a given day. That sounds an awful lot like the same basic idea. If I think about it too, half the lines of code being wasted is probably a relatively reasonable measure for writing code. Not because they're actually literally useless, but because you write a lot of scaffolding, a lot of first passes and a lot of code that will be a dead end or superseded before you're done. If you knew before you started exactly what lines of code you'd need to write, you'd be much more efficient, but we don't, so we write a lot of "waste" code too.
  - chrisjj 2y ago
    > the point of the poster you're replying to is that wasting half your budget would be considered gross incompetence in any other department. Not if there too a spend of X was required to get the value of X/2.
  - 2y ago

TaylorAlexander 2y ago

Sure but should we believe that internal studies at retail chains are quality scientific studies?

dfox 2y ago

Well, it is tested internally for at least 100 years: https://en.wikipedia.org/wiki/Tom%C3%A1%C5%A1_Ba%C5%A5a https://en.wikipedia.org/wiki/Tom%C3%A1%C5%A1_Ba%C5%A5a

subroutine 2y ago

And many physicians still recommend putting ice on sprained ankles 5x per day to reduce the “harmful” swelling. Even though the abundance of research now shows icing delays the infiltration of proteins, hormones, and cells that aid in healing processes (and can even cause further tissue damage). Practices like this stick around because of the desire to be seen making proactive recommendations with putative benefit. With the dresses there is clearly something odd happening. In all cases except one the cheapest dresses sold the fewest items even compared to ones that were $10 more expensive.

Ctyra 2y ago
> Even though the abundance of research now shows icing delays the infiltration of proteins, hormones, and cells that aid in healing processes (and can even cause further tissue damage). Do you mind sharing any references
- compressedgas 2y ago
  https://drmirkin.com/fitness/why-ice-delays-recovery.html https://drmirkin.com/fitness/why-ice-delays-recovery.html
mhb 2y ago
When I was looking for evidence about the efficacy of ice to speed recovery, I found it very challenging. I would be grateful if you could share some of the abundance.
amelius 2y ago
The human body (through evolution) only cares about long term effects for the human species. The actual human might care about pain. Therefore, I don't think that the advice is necessarily bad. Evolution isn't always our friend. There are many examples where our bodies work against us, only to help us evolve better as a species.
dennis_jeeves2 2y ago
>Practices like this stick around because of the desire to be seen making proactive recommendations with putative benefit One manifestation of this phenomenon in it's extreme form is cancer diagnosis and treatments. Barring a few exceptions, most cancer treatments are useless.

ChrisMarshallNY 2y ago

Yup. It's been settled lore, for retailers, as long as I can remember. I don't think they care about metrics. That doesn't cheapen metrics, however. Some pretty meaningful (and, often, annoying) stuff has come from them.

phito 2y ago

Yep it's not science, but engineering

agumonkey 2y ago

Reminds me of people who tried selling sturdy repairable phones with longer battery life. Even when people complained about battery issues etc. They kept buying the thinnest flagship. Mass markets are mass market.

chmod775 2y ago
> Reminds me of people who tried selling sturdy repairable phones with longer battery life. My brother buys these. They survive up to a year in his "care", rather than the usual 3-4 months of flimsier phones. They all end up with cracked screens within months though. Almost no mainstream consumer electronics nowadays are meant for people who lead active lives (outside of planned and streamlined activities like going to the gym or running) - because the people as a whole generally don't live active lives. If you happen to be an outlier, making your phone survive becomes a serious logistical issue. Sadly carrying one is a necessity in this day and age. Another example: Many offroad vehicles/trucks nowadays won't survive days of the advertised use-cases without serious damage and are often utterly unsuited for it (the cybertruck isn't an outlier here). These things are being sold to people who like to play pretend. Manufacturers cross their fingers and hope you don't actually. Notable exceptions to the rule are things like satellite communicators and some dedicated GPS map devices. They seem to have no issue surviving many phones with their own screens and functionality intact. Their manufacturers know you wouldn't buy them if you didn't plan to use them in the advertised conditions.
- dieselgate 2y ago
  Indeed, regarding watercraft have seen it as “you don’t sell the boat you sell the dream”
- ThrowawayTestr 2y ago
  Get your brother a glass screen protector for his phone. I haven't cracked a phone screen in a decade yet I've gone through many cracked screen protectors.
  - chmod775 2y ago

hulitu 2y ago

For me 9.99 is 10. I don't know what they tested, but maybe they shall test again.

feetsoup 2y ago
That's easy to say, but when it comes to shopping at the store, picking up several items and not actively thinking about it, are you really sure you aren't unconsciously interpreting that 9.99 differently from 10? Personally, I like to think that doesn't work on me, but at the same time I've caught myself saying something was '9 dollars' when I've been distracted and it was in fact 9.99. And even if 9.99 really is 10 for you, it could mean that you're different than most people, rather than the methodology being faulty.
- johnisgood 2y ago
  I found it odd that my girlfriend would say out the cents, because personally I have always been rounding up, and never considered the cents, for example.
  - HocusLocus 2y ago
    I try to keep two things in my head when filling a grocery cart, an accurate tally of dollars and a numberless sense of "where in the dollar the cents remainder is presently", like the position of a progress bar on a screen. I find a remembered visual progress bar does not distract me from the arithmetic, and when I spot one of those silly prices ending in .95 or .99 the bar resets to a tiny bit and I add a dollar. My mental progress bar generally jumps in approximate ~1/4 steps and when the total is accurate to within $2 with many items that is a win.