Alaa Rajeh JEDDAH – There are many ways to price a product and in today's highly competitive retail market, vis-à-vis high inflation, the use of sale price strategies or plain “gimmicks” is growing in abundance albeit in a subtle manner. The stratagem is not new as indicated by a study published in Marketing Bulletin way back in 1997 which shows that approximately 60 percent of prices in advertising material ended in the digit 9, while 30 percent ended in the digit 5 and 7 percent ended in the digit 0 and the remaining 3 percent accounted for price evaluation. Normally, consumers, in general, ignore the least significant digits below one hundred cents, under the pretext that they are negligible, hence ended up buying a certain product and unmindful of being shortchanged. Keith Coulter, Associate Professor of Marketing at the Graduate School of Management, Clark University, suggested that this machination may be enhanced when the cents are printed smaller (for example, $19.99). In prices like this, the loose change is normally brushed off. However, scheme of this sort may be dodged and rendered less relevant with the increased use of checks, credit and debit cards and other forms of non-cash payments, which are broadly called plastic cards. But prudent consumers are aware of the fact that, done repeatedly, the accumulative loss would be big enough than when collected and totaled, and could buy yet other goods again. These consumers then resort to the use of plastic payment cards to shun heaping up losses due to overlooked cents, or at best stocking up chewing gums in lieu of “expendable loose cents” as practiced by many a cashier employed at malls or department stores. Besides, using plastic cards has the advantage of not only paying the exact amount, but rather keep the remaining cents safe in the holders' accounts. The psychological impact of pricing shenanigans show how consumers can be swayed to buy certain goods if the prices are a few cents below the higher whole number. Fore example, when seeing a tag price of $100, a consumer may hesitate to purchase, while if the price is $99.95, his subconscious would induce him to buy – in short, falling into a trap. In an exercise I have done few months back, I found out that those loose cents could eventually become a 3-digit number. After purchasing several items in a 6-month period using plastic cards, I ended up collecting SR200, good enough to fuel my car for one month. Accordingly, using plastic payment cards is the best mode to use for wary consumers. — The writer is a PR manager based in Saudi Arabia
