Connect with us

Business Marketing

Why prices ending in 9 sell best: MIT study

Have you ever wondered why prices at retailers usually end in the number 9? It’s not because it’s a sexy number, there is science behind it.

Published

on

pricing with nines

pricing with nines

Why the number nine is so powerful

[ba-pullquote align=”right”]Finding the right price to attach to a product or service is an art.[/ba-pullquote]Pricing your product or services may be one of the most stressful parts of owning a business. You know your service is valuable. You know there is an audience out there that understands that value. But finding the right price to attach to a product or service is an art. If you price something too high, you won’t be as successful. If you price things too low, customers may not think your service is valuable and you won’t be making what you deserve. Finding the perfect balance is important, but it’s also about knowing how customers view prices, especially prices that end in the number nine.

We’ve all seen pricing that ends in the number nine. Take purchasing gasoline, for instance. It always has the same formatting, no matter which gas station you frequent. You’ve seen it in nearly every store you’ve walked into. So, how do you take all of this and apply it to your own pricing? First you must understand the effect that ending a price with a nine can have on your customers or clients.

Experiment: women’s clothing

[ba-pullquote align=”right”]The $39 item sold the best, even better than the cheaper price of $34.[/ba-pullquote]MIT and the University of Chicago conducted an experiment with prices on women’s clothing. They had three basic prices, $34, $39, and $44. Surprisingly, the $39 item sold the best, even better than the cheaper price of $34. However, they did find that sales prices that are listed by the original price can easily beat out a price ending in nine. One reason is the mind sees the first set of numbers and registers it as priced in the 30-dollar range, even when it’s closer to the 40-dollar range. Purchasing an item for $39.99 will seem more of a value than purchasing the same item for $40 even. It’s only different by a penny, but that one penny seemingly takes the price to an entirely lower level, thus increasing the value and the deal.

Customers also sometimes prefer to pay a middle price rather than either end because it can feel as though they’re getting a great deal and it’s better quality than the lowest price. Customers are looking for bargains and value, and that combination can be difficult to come by. And that’s where you and your business come into the picture.

Pricing your own services

[ba-pullquote align=”right”]Be open to change and improvement. Be open to progression.[/ba-pullquote]When pricing your services, consider offering a few price points and end them with a nine for good measure. You may find that your most popular service is the one priced right in the middle. Don’t feel as though you’re trapped once you choose your prices. You can always switch them if they’re not giving you the response you’re looking for. Be open to change and improvement. Be open to progression. That’s when you’ll find success and reach your professional goal.

The American Genius Staff Writer: Charlene Jimenez earned her Master's Degree in Arts and Culture with a Creative Writing concentration from the University of Denver after earning her Bachelor's Degree in English from Brigham Young University in Idaho. Jimenez's column is dedicated to business and technology tips, trends and best practices for entrepreneurs and small business professionals.

Continue Reading
Advertisement
12 Comments

12 Comments

  1. Lane Bailey

    July 6, 2012 at 10:53 am

    The problem with that is real estate search. I find that most consumers search with round numbers… like $100k to $125k. Pricing at $99,999 (or even the popular $99,900) means that the house is missed by a large percentage of consumers. The other thing to keep in mind is that were aren’t talking about a pair of pants, or even a fridge. We are talking about a house. The study specifically focused on a blouse around $40. That is a LOT different than a house that might be several hundred thousand dollars. What do you think?

  2. Mike Schmidt

    July 6, 2012 at 10:56 am

    9 has halways been my number. Born on the twenty-9th, married on 9-9-81 @ 9am. Number nine, Number 9, Number n9ne…

  3. Goodcleanliving

    July 6, 2012 at 11:03 am

    @AgentGenius It doesn’t work in real estate. Cheapens listings and dodges important Boolean search basis. Counter intuitive.

  4. DanielBates

    July 6, 2012 at 1:06 pm

     @Lane Bailey By the same logic that the listing misses the $100-125 range, doesn’t it fall into into the $75-100 range? Wouldn’t a good real estate agent search a larger range for their client anyway? 
     

  5. Lani Rosales

    July 8, 2012 at 8:17 pm

    i was born in 81. do i get a prize?

  6. Mike Schmidt

    July 8, 2012 at 9:38 pm

    You are a prize, but yes.

  7. Lani Rosales

    July 8, 2012 at 11:41 pm

    i sense sarcasm, Schmidty

  8. Mike Schmidt

    July 9, 2012 at 10:26 am

    Never.

  9. Mike Schmidt

    July 9, 2012 at 10:27 am

    And you really are. My days would be less interesting without your posts.

  10. Guyn22wun1

    July 9, 2012 at 1:21 pm

    @DawnaDavies https://t.co/xyjDyodw

  11. Nanette

    July 9, 2015 at 11:19 pm

    $39.99 vs $40.

    More like the businesses think that We, People are stupid and can't do math.

    • Lani Rosales

      July 10, 2015 at 12:04 pm

      Nanette, you're totally right, and since publication of this story, more research has been done that shows that our brains have been rewired to mistrust non-rounded numbers. The major exception is real estate, because of how syndication works (someone thinks they don't want anything $150k or over, so they limit search to under that, making Realtors price homes at $149,999 to be included in said search).

Leave a Reply

Your email address will not be published. Required fields are marked *

Business Marketing

A personalized daily digital marketing checklist

(MARKETING NEWS) For all businesses, it is not only essential to develop an digital marketing strategy, but also necessary to utilize it in order to gain customers, and ultimately make a larger profit. This app can help.

Published

on

clearpath digital marketing

There is no doubt that starting your own business can be overwhelming. Along with promoting your business at events, meetings and in person, digital marketing strategies play a key role in the success of a company. For all businesses, it is not only essential to develop an online presence, but also necessary to utilize it in order to gain customers, and ultimately make a larger profit.

Simply creating a website and Facebook page for your business is not enough. However, software tools can help simplify digital marketing. ClearPath is a tool that organizes and creates tasks to optimize your online marketing. By creating to-do lists for you based on your online marketing strategy, you can focus on the areas of marketing that improve your business, all the while receiving useful tips and advice.

Using ClearPath is pretty straightforward and only requires one prerequisite. Before beginning, you must have a website.

If you are already lost, don’t panic. ClearPath can help you develop an online presence. Once your website is linked up, you get to choose the marketing channels that you would like to focus on. These include Search Engine Optimization (SEO), email, social, content, analytics, local, pay-per-click (PPC) and Conversion Rate Optimization (CRO). Again, if you are lost, ClearPath is there to help you strategize.

After ClearPath analyzes your site, they start sending you customized tasks based they believe can improve your online marketing.

As you finish each task, you can simply check it off and it will disappear. New tasks will appear each day, and some may even repeat as they need to be updated.

Whether you are well-versed in digital marketing or not, staying updated with the newest ways to optimize your business online is a constant struggle. Tools like ClearPath give people a place to start. Although I don’t think it can supplement an active and experienced digital marketer, it is a tool that can help small businesses that cannot afford to add to their team yet. At the end of the day, it aims to save you time. And since time is money, your business will hopefully be more profitable.

Continue Reading

Business Marketing

Simple logo creation tools perfect for any freelancer

(MARKETING) You already know that even if you’re a solo writer, or lone developer, you need a brand in today’s online world. If you’re on a budget, check out these logo creation tools!

Published

on

logo creation

Freelancing is a major part of the landscape nowadays. In that capacity, you’re running your own one-person business. As such, you need to brand that business. You know that, but let’s discuss the actionables.

I don’t know about you, but when I hear the word “branding”, I immediately envision logos (which is super convenient because it brings me to my next point). You should absolutely have a logo as a freelancer, even if it’s simply just your name in a rad – but professional – font.

This will be useful on your website, social media, on invoices and beyond. You can even pop that bad boy into your email signature!

Ideally, you should hire a graphic designer that knows what they’re doing – you’ll get the best results. But if your budget is zero dollars, don’t you dare ask a professional for free work.

Instead, if you want to develop a logo for your personal freelancing brand on the cheap, check out five of our favorites below and see what works for you. The best part? These all have some free components.

  1. Picfont: Let me start with personal experience. My freelance logo (which is the cover photo of my Twitter), is literally just my name in a script-like font, and was made using Picfont. You can upload a blank background (or pick from fun royalty-free backgrounds) and choose from a variety of font options. Pick what you like, shape it out, download, and use. Easy
  2. Looka (formerly Logojoy) is also a great, easy-to-use online logo maker. You simply type in your company name/your name and go through a process of selecting colors and styles that you like. Looka then generates a selection of logos based on your choices. For an example, I created the logo for The Tidbit using Looka.
  3. Online Logo Maker: a wonderfully self-explanatory name. This logo maker is almost like a combination of Picfont and Logojoy. You can play around with different fonts, colors, and symbols to make a logo that fits you. This option also features high-quality Vector files.
  4. Canva is a great option because you can design a multitude of material (including flyers, presentations, graphs, etc.) If you’re planning to build a full-on portfolio with supplemental materials in addition to a logo, Canva may be your best bet as you can design everything to have a similar look – which is incredibly important for branding.
  5. DesignEvo: Their website describes it best, “DesignEvo is a free online logo maker with 8,000+ templates that anyone can use to bring to life a compelling, unique logo in minutes.” They have a drag and drop interface and hundreds of fonts.

Take some time to test drive these sites, play around with different logo types, and see which one gels best with you and your freelancing-self. Happy branding!

Continue Reading

Business Marketing

How to use offline marketing to your advantage in a digital world

(BUSINESS) We often become obsessed with new marketing strategies, favoring the internet over some traditional methods that continue to drive traffic timelessly.

Published

on

offline marketing open sign for small business

Everywhere you look, people want to talk about digital marketing. In fact, if you don’t have a digital marketing strategy in today’s business world, you’re not going to last long. But just because digital marketing is popular, don’t assume that offline marketing no longer yields value.

When used together, these strategies can produce significant returns.

“Some people will argue that traditional marketing is dead, but there are several benefits to including offline advertising in your overall marketing campaign,” sales expert Larry Myler admits. “Combining both offline and online campaigns can help boost your brand’s visibility, and help it stand out amongst competitors who may be busy flooding the digital space.”

How do you use offline marketing in a manner that’s both cost-effective and high in exposure? While your business will dictate how you should proceed, here are a few offline marketing methods that still return considerable value in today’s marketplace.

1. Yard signs

When most people think about yard signs, their minds immediately go to political signs that you see posted everywhere during campaign season. However, yard signs have a lot more utility and value beyond campaigning. They’re actually an extremely cost-effective form of offline advertising.

The great thing about yard signs is that you can print your own custom designs for just dollars and, when properly stored, they last for years. They’re also free to place, assuming you have access to property where it’s legal to advertise. This makes them a practical addition to a low-budget marketing campaign.

2. Billboards

The fact that you notice billboards when driving down an interstate or highway is a testament to the reality that other people are also being exposed to these valuable advertisements. If you’ve never considered implementing billboards into your marketing strategy, now’s a good time to think about it.

With billboard advertising, you have to be really careful with design, structure, and execution. “Considering we’re on the move when we read billboards, we don’t have a lot of time to take them in. Six seconds has been touted as the industry average for reading a billboard,” copywriter Paul Suggett explains. “So, around six words is all you should use to get the message across.”

3. Promotional giveaways

It’s the tangible nature of physical marketing that makes it so valuable. Yard signs and billboards are great, but make sure you’re also taking advantage of promotional giveaways as a way of getting something into the hands of your customers.

Promotional giveaways, no matter how simple, generally produce a healthy return on investment. They increase brand awareness and recall, while giving customers positive associations with your brand. (Who doesn’t love getting something for free?)

4. Local event sponsorships

One aspect of offline marketing businesses frequently forget about is local event sponsorships. These sponsorships are usually cost-effective and tend to offer great returns in terms of audience engagement.

Local event sponsorships can usually be found simply by checking the calendar of events in your city. Any time there’s a public event, farmer’s market, parade, sporting event, concert, or fundraiser, there’s an opportunity for you to get your name out there. Look for events where you feel like your target audience is most likely to attend.

Offline marketing is anything but dead.

If your goal is to stand out in a crowded marketplace where all your competitors are investing heavily in social media, SEO, PPC advertising, and blogging, then it’s certainly worth supplementing your existing digital strategy with traditional offline marketing methods that reach your audience at multiple touchpoints.

Continue Reading
Advertisement

Our Great Partners

The
American Genius
news neatly in your inbox

Subscribe to our mailing list for news sent straight to your email inbox.

Emerging Stories

Get The American Genius
neatly in your inbox

Subscribe to get business and tech updates, breaking stories, and more!