What is psychological pricing in the retail industry?
Psychological pricing is a strategy by marketing and pricing professionals based on the theory that certain price values have a psychological impact on customers, making them more likely to buy. In this pricing method, retail prices are often expressed as numbers that are just a little less than a round number or a whole number. For example - displaying a price tag of $6.99 instead of $7.00 leverages the customer's emotional response and influences purchase decisions.