What is Odd-Even Pricing?
Odd-even pricing is a pricing strategy used by retailers to encourage customers to purchase more items by pricing them at a seemingly lower cost. It is also known as charm pricing, psychological pricing, or fractional pricing. The concept behind odd-even pricing is to create a perception of a lower price than the actual cost. For example, if a product would normally cost $19.99, it could be priced at $19.95.
Advantages of Odd-Even Pricing
Odd-even pricing has several advantages for retailers. Firstly, it helps to create an impression of a lower price than the actual cost. This can encourage customers to purchase more items as they feel they are getting a better deal. In addition, customers often perceive odd-even pricing as being more expensive than a regular pricing strategy. As a result, retailers can charge a higher price than they would have been able to if they had used the traditional pricing strategy. Finally, odd-even pricing can help to create a sense of urgency for customers. By pricing items at a slightly lower cost, customers may feel like they need to purchase them quickly before the price increases.
Examples of Odd-Even Pricing
Odd-even pricing is a common pricing strategy used by retailers. The most common example is 99-cent pricing, where items are priced at $0.99 rather than a round number like $1.00. Other examples of odd-even pricing include $14.95 instead of $15.00 and $30.98 instead of $31.00.
Conclusion
Odd-even pricing is a popular pricing strategy used by retailers to encourage customers to purchase more items and create a perception of a lower price than the actual cost. It can also help retailers to charge a higher price than they would normally be able to and create a sense of urgency for customers. Some examples of odd-even pricing include 99-cent pricing, $14.95 instead of $15.00 and $30.98 instead of $31.00.
References
https://www.investopedia.com/terms/o/odd-even-pricing.asp https://www.marketing91.com/odd-even-pricing/ https://www.marketing-schools.org/types-of-marketing/odd-even-pricing.html