Why 99p? Why not £1?

Don't you ever wonder ? Some of the products prices end up with 99p ,so why not £1? Most of the consumers are price sensitive and they are tempted with the price tags. 99p strategy is very old trick but the retailers still feel hard to change.

According to the researcher , by lowering pizza price from 8 euros to 7.99 euros boosted the sales  by 15%.On the other hand , according to virgin Money ,in 2005 Britons discarded or stashed away £133m unwanted coppers. You  see there is a verdict that is it for sales or is it for to make it easier to track cash flow. It forces cashier to open the till and give the change .Once the till was open, it registered as a sale.

Furthermore , Dr Jane , lecturer in psychology at the University of Glamorgan, stated we "tend to put numbers in categories like 'under £5' or 'under £6' - rather than them representing a value. Shoppers are aware of what is going on, but don't respond to it because they don't think logically about how close numbers are - such as £99.99 and £100." Furthermore, consumers think they are getting better offers.

According to Robert Schindler, professor of marketing at Rutgers Business School in the US, says ,  "It is like when a 39-year-old turns 40, the birthday feels like a big deal. Or when 1999 ends and 2000 starts. It feels like an emotional difference." And he is absolutely right . Some of the consumers tend to buy the products which is £49.99 rather then £50.00 , which is 1p different.

Another strategy might be for collecting charity. Because a lot of people do not want take 1p change and they think it is hassle for them. All the 1p changes are piled up in the drawers or mug or piggy bank , so they ended up going to the charity. Plus, a lot of retailers or restaurants put the charity box in front of cashier , so when consumer take 1p change they just put in the charity box.

It is a psychological manipulation , one way or another .Marketers play with the consumer mind .