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Unique Number Pricing

 

DisciplinesMarketing > Pricing > Unique Number Pricing

Description | Example | Discussion | See also

 

Description

Rather than using a rounded number or something close to it, use a price that is totally unique, for example using $17.34 rather than £20.

In this unique pricing, avoid five and ten boundaries (so not $17.35) as these are often seen as being artificial.

Example

A retailer prices a kitchen mixer at $343, rather than the recommended $360. This is seen not only as a discount but also a fixed one.

A sales person in a negotiation taps on his calculator and announces that the minimum price he can accept is $3843.45. Then, under pressure reduces it to $3800.

Discussion

Customers get used to round numbers (eg. $30), '99' numbers (eg. $29.99) and other pricing methods, which reduces the effectiveness of these methods. When you use a unique price, customers will pay more attention to it and assume that there is a good reason for this price, for example that you took cost price and added a simple fixed percentage for profit. This assessment of your profit can also make customers be suspicious of rounded pricing as they assume that you have added your profit and then rounded the number up again.

When we see numbers we tend to round them to something nearby. If the number given does not have a near alternative, the reader will leave it where it is. In this way, unique numbers act as an anchor, and so stop customers from mentally rounding them up (or even seeking to negotiate much below them).

When the height of Mount Everest was first calculated by Andrew Waugh, it was found to be exactly 29,000 feet. Waugh realized that people would think that he rounded the number to this, so he added two to the number, so announced it as being 29,002 feet.

See also

The Price Anchoring Effect

 

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