Why prices always seem to end with the number 9

Think you’re too savvy to be influenced by prices ending in nines? Think again

One UC Berkeley study carried out a study to find out why this pricing strategy finds itself everywhere, and why it seems to be working so well. 

The study found that the average person perceived prices ending with ‘99’ to be worth 15 to 20p less than the left most number.

This perceived pricing tendency is called left-digit bias, where the left most number on a price tag disproportionally influences purchasing decisions.

For example, a £3.99 price tag somehow appears 15 to 20p cheaper that the full £4, resulting in sales increasing 3 to 5 folds than if it were 1p more expensive. 

The circumstance is referred to as Charm Pricing in pricing psychology, where reducing the left-most digit is the name of the game.

At surface level, the 1p difference might seem like a negligible difference, but it’s all tied to how our brains are wired. 

In western society, we tend to always read from left to right, causing our eyes to land on the left-most digit, which is why £3.99 seems like a steal compared to a £4 price tag.

Where else the magic number affects our price assumptions 

However, the magic of the number 9 extends itself outside monetary values. 

Toronto University carried out a study with care mileage and what prices we’d stick to them.

The study found that a car with 79,999 would sell for $200 more than a car with 80,000 miles, but would sell for the same as a car with a 79,899 mileage. 

The same can be said about a car with 99,990 miles compared to one with 100,000, even though it has 10 miles less than its counterpart. 

However, like everything in life, there are drawbacks. 

A price tag of £19.99 won’t look like a bargain compared to a £19.25 price tag. 

The same can be said about property listings, where a property valued at a monthly £2,200 can come as blatantly manipulative if listed at £2,199. A £2,175 price would come off as a fairer listing. 

Now that you understand the pricing landscape a little more, make sure to keep an eye out on prices while on your weekly grocery haul.