Round Pricing PreferenceOpen Access

Round Pricing Preference

We prefer and trust whole numbers over those ending in a 9

Whole prices have a powerful effect on perceptions of honesty and quality, particularly for more expensive, pleasurable or ethical products.

Wieseke, Kolberg & Schons (2016). Life could be so easy: The convenience effect of round price endings. Journal of the Academy of Marketing Science.

The study

Setup

Setup

306 people visited one of three coffee shops and were asked to buy a coffee at either: €0.99, €1, €1.01 or an orange juice that was €0.15 cheaper than the respective coffee price.

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Results

Results

Results showed that, contrary to conventional research on pricing (shown by the dashed line), the round-priced coffee saw the highest % of sales.

Study graph
np_read_2490885_000000

Wieseke, Kolberg & Schons (2016). Life could be so easy: The convenience effect of round price endings. Journal of the Academy of Marketing Science.

Key Takeaways

1
1

Use round prices to reduce fatigue.

There’s a growing trend for cognitive convenience in the face of Time Scarcity and Analysis Paralysis

A banana costing £1 is easier and faster to process mentally than one costing £0.95. UK retailer Tesco now adopts this specifically for promotions.  

If your brand places a value on saving time and energy, consider doing the same.

Takeaway image
2
2

Use for premium, green or pleasurable products.

Marks & Spencer (UK), Saks (US) and Levi’s now adopt round pricing, showing the zeros. Doing so signals brand quality, warmth and trust.

Takeaway image
3
3

 Use to nudge secondary behaviors.

For transactions, add a Foot In The Door to give the rounded difference to charity (supermarket), savings (banks) or tips (fast food), for example.

Takeaway image
4
4
Takeaway image
Takeaway image
Round Pricing Preference

Round Pricing Preference

We prefer and trust whole numbers over those ending in a 9

Whole prices have a powerful effect on perceptions of honesty and quality, particularly for more expensive, pleasurable or ethical products.

The study

Setup

306 people visited one of three coffee shops and were asked to buy a coffee at either: €0.99, €1, €1.01 or an orange juice that was €0.15 cheaper than the respective coffee price.

Results

Results showed that, contrary to conventional research on pricing (shown by the dashed line), the round-priced coffee saw the highest % of sales.

study graph
np_read_2490885_000000

In detail

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