Why do so many price tags end in $0.98 or $0.99?
That’s a question I have asked myself many times over the years. It always seemed strange to me — wouldn’t it make more sense to choose a round number?
Maybe. But it wouldn’t be a great strategy.
Because as it turns out, those odd prices aren’t chosen because the retailer is going for quirky.
It’s part of a very intentional pricing strategy known as charm pricing.
Here’s how it works.