A new study has recently revealed that rounded price encourages consumers to rely on emotions while evaluating products.
Five studies reveal that rounded prices (100.00 dollars) make consumers more likely to buy a product when a purchase is primarily driven by feelings (buying a camera for a family vacation).
However, non-rounded prices (98.76 dollars) make consumers more likely to buy the same product when a purchase was rational or utilitarian (buying a camera for a class project).
Companies should be aware that small changes in pricing can have a big impact. Products that are purchased for recreational or personal reasons (vacation packages, clothing and handbags, or even houses) could benefit from rounded prices. Meanwhile, companies selling practical products (appliances, toothpaste) could benefit from using non-rounded prices.
The study is published in the Journal of Consumer Research.
