Power of 9

According to a study conducted by MIT, women are more like to buy a dress prices $39 instead of $34. The study also found that sales were 24% higher for prices ending with the magical number 9.

Known as left digit effect or charm prices. The last number that we see in the price tag is stuck on our brain. Additionally, our brain associate the number with deals and discounts. As humans, we consider a huge difference between $1.99 and $2. Moreover, we associate $1.99 with $1 instead of $2. On the same lines an iphone priced at $999 seem just of $900 instead of $1,000. That’s how companies leverage psychological pricing. Apple never do pricing on round figures. All its product end with the digit 9. Check out the prices of iWatch on official site.

Left digit effect: Reducing the left digit by one works like a charm for the sellers. Next time when you purchase anything online/offline be aware of the bias of the brain.

If you are manufacturer or distributor, this pricing strategy will bring more revenue for you. Though in some situation this may not work. When it come to discounts and cashback. They are generally offered in round figure ending with zeros or five. As we consider huge difference between 99 and 100. The cashback offered are of 100 rupees instead of 99.

Knowing the functioning of brain can help us earn and save thousand of bucks

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