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Why charging $12/year converts higher than $9.99

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Re: Why charging $12/year converts higher than $9.99

#41

Post by Seth_Kriticos »

swores wrote: post #2

Is the reason that $12 converted better than $9.99 definitely because users are able to visualise it as one dollar a month? Maybe people see the .99 and are trained to think "99 cents is a marketing plan to make me think it's cheaper than it is", thus causing it to have the opposite effect? Maybe people see $9.99 as a generic price, implying it was picked fairly randomly, whereas $12 is a slightly odd number to chose…

My guess is, that it's exploiting the basic synaptic nature of the brain. The 12 numeral automatically kicks in the association with months, which in turn splits the sum to 12 x $1, or one dollar a month which seems low enough to feel at ease with.

Seems to be intuitive enough to happen subconsciously.

The other price points just appear as one fixed sum in the mind, which is much less likely to be spent on a whim.

Re: Why charging $12/year converts higher than $9.99

#43

Post by rythie »

swores wrote: post #2

Is the reason that $12 converted better than $9.99 definitely because users are able to visualise it as one dollar a month? Maybe people see the .99 and are trained to think "99 cents is a marketing plan to make me think it's cheaper than it is", thus causing it to have the opposite effect? Maybe people see $9.99 as a generic price, implying it was picked fairly randomly, whereas $12 is a slightly odd number to chose…

I don't like prices like $9.99 first I have to round up to $10 and then I haven't actually seen that price next to the item.

When someone quotes the price verbally $9.99 it's longer than $10, so sounds bigger.

Also, $9.99 sounds like they are embarrassed that it's that much and they have to trick you into paying more than you thought you were.

Re: Why charging $12/year converts higher than $9.99

#44

Post by jarek »

msuster wrote: post #11
swores wrote: post #2

Is the reason that $12 converted better than $9.99 definitely because users are able to visualise it as one dollar a month? Maybe people see the .99 and are trained to think "99 cents is a marketing plan to make me think it's cheaper than it is", thus causing it to have the opposite effect? Maybe people see $9.99 as a generic price, implying it was picked fairly randomly, whereas $12 is a slightly odd number to chose…

Watch the show. He talked about trying $13.99 and other price points. Nothing converted better than $12.

Sorry, haven't watched the show - has he tried $10, rounded off?

Re: Why charging $12/year converts higher than $9.99

#45

Post by jarek »

detst wrote: post #39
wazoox wrote: post #36

Earlier quoted context omitted.

AFAIL this is a very specific (and weird) US idiosyncrasy. In all other countries I can remember, you pay the price displayed.

Sure, it sounds nice to have a price and know that's exactly what you're paying but I prefer the US way. I want to be reminded how much of a cut the government is taking. I don't want taxes to be hidden in the price of my purchase. I want to know that an increase in price is due to some business factor or if the government is taking a larger cut.

Meanwhile, the rest of the world will be over here not having to do mental math every time we go to buy something with a $/£/€5 bill. And we'll still know how much tax the government is charging if we really care - it's printed on the receipt.

Wondering - how do you feel about gas prices? Do you support advertising airline tickets net of 30-50% surcharges so you can know exactly how much of your ticket goes to fuel, airport charges, taxes, and "fees"? And for the other side of the coin - what about not being reminded exactly how much value you got out of the government every time you drive down a road?

Re: Why charging $12/year converts higher than $9.99

#46

Post by frobozz »

detst wrote: post #39
wazoox wrote: post #36

Earlier quoted context omitted.

AFAIL this is a very specific (and weird) US idiosyncrasy. In all other countries I can remember, you pay the price displayed.

Sure, it sounds nice to have a price and know that's exactly what you're paying but I prefer the US way. I want to be reminded how much of a cut the government is taking. I don't want taxes to be hidden in the price of my purchase. I want to know that an increase in price is due to some business factor or if the government is taking a larger cut.

Various countries manage this without requiring the customer to keep themselves up-to-date with local tax laws.

The sticker price is the actual price paid (including tax), but the receipt shows the itemised pre-tax price, with tax added on at the bottom.

Re: Why charging $12/year converts higher than $9.99

#48

Post by jcl »

callmeed wrote: post #7
swores wrote: post #2

Is the reason that $12 converted better than $9.99 definitely because users are able to visualise it as one dollar a month? Maybe people see the .99 and are trained to think "99 cents is a marketing plan to make me think it's cheaper than it is", thus causing it to have the opposite effect? Maybe people see $9.99 as a generic price, implying it was picked fairly randomly, whereas $12 is a slightly odd number to chose…

Exactly–seems a little speculative. Maybe $9.99 would have converted more if they sold it as "That's less than a dollar a month!"

I wonder how it would have done priced at $12 but immediately discounted to $9.99? (Not only is it easy to see how cheap it is, but it's also on sale.)
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