Recently, we have been testing a new pricing strategy in our software in some sites. It comes out of an article in the Journal of Consumer Psychology here.
New research shows that prices that take longer to say seems more to consumers, for example, 99 cents takes longer to say then 1. As such 99 cents seems bigger than one. The same effect is $4,999.99 then 5000. The dollar sign, commas and cents all add to the length. This is because as we read the price, we pronounce it in our brain.
So what we are doing is trying on some test sites, instead of pricing $4.99 our software makes it 5. $0.99 becomes 1. As to make it shorter even the dollar symbol is dropped even though it does not look so nice.
When I have some results, which are soon, I will let you know how this option works in practice.
Note according to the article the effect appears with the number 7 as it is the only number with two syllables as such it should not be used. 77 has four syllables; 80 has only two. As such 97 cents should never be used, make it 96 or 98 cents, better is a dollar and better still is one.
If you are interested let me know.
