why odd numbers when buying merchandice?

[justoneguy]

~~~~~~~~~~
DID YOU EVER WONDER WHY PRODUCT SALE PRICES END IN AN ODD NUMBER?
Melville Stone was a self-made man, who worked his way up from newspaper
carrier to publisher of the Chicago Daily News. When Stone first started
his newspaper in 1875, the price was a penny. Circulation rose rapidly
at first, then leveled off. Then sales started lagging. When Stone
investigated why fewer people were buying his paper, he discovered the
problem had nothing to do with its quality. Pennies were in short
supply. Stone decided he had to do something. First he traveled to the
United States mint in Philadelphia and brought about the transfer of
barrels of pennies to Chicago. The problem then became how to get the
pennies into circulation. So Stone persuaded Chicago merchants to
sponsor "odd-price sales," during which they would sell their
merchandise for a penny under the regular price. The odd prices did the
trick. People had pennies again, and Stone's paper flourished. And that
is why store items today cost "$8.99," or $12.99," instead of even
dollar amounts.

[Cerulean]

This article set off my BS detector, and within thirty seconds of Google searching, I find out that the Melville Stone penny story is an old and common myth.

http://www.straightdope.com/columns/rea ... -end-in-99

"Very interesting, maybe even true (up to a point), but probably not the reason prices end in .99 today. The problem: Melville Stone ran the Daily News for only a few months before selling out in 1876. Judging from Daily News advertisements, prices ending in 9 (39 cents, 69 cents, etc.) were rare until well into the 1880s and weren't all that common then. The practice didn't really become widespread until the 1920s, and even then prices as often as not ended in .95, not .99.

So what's the real explanation? Having spent two hours poring over the microfilm--no guarantee that I'm not full of BS, but at least it's scientific BS--I'd say it was retail price competition in the 1880s. Advertising prices in the newspapers was rare before 1880 but common after 1890. At first prices were usually rounded off to the nickel, dime, or dollar, but it wasn't long before a few smaller operators looking for an edge began using what might be called "just under" pricing (49 cents, $1.95, and so on), no doubt in an effort to convince the gullible they were getting a bargain.

The idea caught on surprisingly slowly. Even in the 1920s some large merchants still rounded prices off to the nearest dollar or on larger items to the nearest $5 or sawbuck. Today's custom of having nearly every price end in 99, 95, or 49 cents or dollars (or just a 9 for items under $5) is of fairly recent vintage. The practice bespeaks a certain low cunning, but it's also pretty obvious and trying to find out who invented it is like trying to find out who invented the hat."

Thank you, Cecil Adams.

[PreservingThePast]

Cerulean.......I agree. I tried doing some internet searching but couldn't find anything.

I believe it also has to do with a psychological edge...sort of what you are saying. A large percentage of people will think "oh, it only costs $4.00" when the price is actually $4.99 and thus truly about 20% more than they are perceiving it to cost.


Sort of like.......a good many years ago when we had our tackle store there was to be a vote in our county to raise the sales tax one extra cent from 5 cents to 6 cents with the county keeping the added cent. Our business was a place where all of our customers sat around and shot the breeze with us and the other regulars and tried to solve world problems. We were completely shocked and dismayed at the number of our customers who were in favor of this tax increase and their logic/reasoning (I KID YOU NOT!!!) was that it was only a 1% increase. We would tell them NO, it isn't a one percent increase it is a twenty percent increase. One cent is 20% of five cents so it will be increasing twenty percent. No, they would argue it is only increasing one percent because it is only going up one cent.

I fear this could be some of the reasons that prices are set the way they are and again another sad commentary on our country.

[totalcount]

Sort of like.......a good many years ago when we had our tackle store there was to be a vote in our county to raise the sales tax one extra cent from 5 cents to 6 cents with the county keeping the added cent.

We had a similar debate in my state. All the newspaper articles talked about raising the tax one cent, when really, it was one percent. It only was once cent if you bought something for exactly $1. Lots of thought goes into making people thing something costs less than it really does.

[kiwiman]

cool story though

[bman]

the same reason gas prices have the 9/10 of a cent on the end...it looks cheaper then it really is.

[misteroman]

Lg pizza is 10.99 + tax.
Not $11 lol