Ohio State study shows 99-cent pricing trick may backfire on retailers


File photo from Getty Images

COLUMBUS (WCMH) — A study conducted by researchers at Ohio State University takes on the retail pricing trick of setting a price just below a round number — for instance, $39.99 instead of $40.

Although the 99-cent price point may lead consumers into thinking the product is less expensive than it really is, researchers found that “just-below” pricing makes consumers less likely to upgrade to a more expensive version of the product or service.

“Going from $19.99 to $25 may seem like it will cost more than going from $20 to $26, even though it is actually less,” said Junha Kim, doctoral student and lead author of the study. “Crossing that round number threshold makes a big difference for consumers.”

The results were obtained from seven different experiments on a variety of products, including coffee, facemasks, streaming services, cars, and apartments, according to OSU.

The study, “The Threshold-Crossing Effect: Just-Below Pricing Discourages Consumers to Upgrade,” was published Thursday in the Journal of Consumer Research.

Copyright 2021 Nexstar Media Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.

More As Seen on 2 NEWS

Trending Stories

Don't Miss

More stories not to miss...


More BestReviews

Latest News Videos

20th annual Hispanic Heritage Festival held at RiverScape

Ohio nonprofit feeling affect of rising COVID-19 cases as biggest fundraiser approaches

Person killed in crash

STEM School shooter sentenced to life in prison without parole plus 1282.5 years

Watch: John Castillo, prosecutors, speak after STEM shooter's sentencing

Two of Gov. Newsom's children test positive for COVID-19

More News