Odd pricing

What is odd pricing and why is it commonly used in retail?

Odd pricing, often referred to as "charm pricing," is a psychological pricing strategy where products are priced just below a round number, typically ending in .99, .95, or .97. For instance, a sneaker priced at $99.99 instead of $100 is applying the odd pricing technique. The idea behind this approach is that consumers perceive prices ending in these odd numbers as being lower than the next whole number, even if the difference is just a few cents. It gives the impression of a bargain or a deal, making the product seem more attractive and affordable. In the sneaker reselling industry, odd pricing can be used to stimulate sales and create the perception of value. When customers see a sneaker priced at $199.99, they might mentally round down to $199, thinking they're getting a better deal than if the price was $200. This subtle psychological trick can have a significant impact on buying decisions, making customers more inclined to make a purchase. While odd pricing is widespread in many retail sectors, it's essential for sneaker resellers to use it judiciously. Overuse can dilute its effectiveness, and savvy customers might start ignoring such pricing tactics. The key is to understand the target audience and apply odd pricing where it can genuinely create a perception of value.