Sneaky Pricing

Next time you're in a store and getting a great deal, consider this: maybe that's just what you're meant to think. Consumers heavily rely on retailers for pricing cues, according a Harvard Business Review article by Eric Anderson and Duncan Simester, professors at Northwestern University and M.I.T., respectively. For example, you're more likely to buy if a price ends in a 9. And beware of sale signs without stated discounts: they can increase demand more than 50%, though the price may not actually have changed. A less obvious tactic: signpost items that are price sensitive, such as soda. A good price on Coke can lead a consumer to believe all items at the market are bargain priced, even if it's just the pop that's cheap.