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Psychological pricingâalso known as price ending or charm pricingâis a marketing strategy based on the idea that certain prices influence consumer perception and behavior. This approach often involves setting prices just below a round number, such as $19.99 instead of $20 or ÂŁ2.98 instead of ÂŁ3. These "just-below" or "odd prices" can make an item seem significantly cheaper than it actually is, as consumers tend to round down rather than upâfor example, perceiving $1.99 as closer to $1 than $2. The underlying theory suggests that such pricing techniques increase demand by exploiting irrational tendencies in consumer decision-making. Psychological pricing is one of the key factors behind the establishment of common price points in retail.
Why do so many prices in Asia end with the number 8? Well, while American sellers are busy messing with your brain through consumer psychology, Asian sellers are all about luckâand not the kind you find under a rock, but the lucky number kind!
In the U.S., prices love to end in 9. Seriously, studies show that between 35% and 65% of all prices there finish with a 9. And stores like 99 Cents Only? Theyâre basically obsessedâabout 90% of their stuff is priced at exactly 99 cents. Why? Because that little â9â is like a magic charm that makes us feel like weâre getting a deal. Iâve even written about this charming little trick before.
But hereâs the plot twist: in many Asian countries, that 9-ending price craze just doesnât catch on. Instead, the number 8 steals the spotlightâbecause itâs considered super lucky. So in this post, weâre diving into why 8 beats 9 over there and what it says about how different cultures think when theyâre slapping price tags on stuff.
Prospect Theory
So hereâs the deal: when shoppers are unsure what to do, they donât just look at the final price tag like itâs some absolute truth. Nopeâthey compare it to a âreference point,â kind of like that mental baseline in their brain. Itâs like when youâre deciding if a deal is good, youâre not thinking, âIs this $19.98 a good price?â Youâre thinking, âHey, itâs just under $20âscore!â
Now, hereâs where it gets fun: tiny differences from that reference point get way more attention than they deserve. Like, a couple of cents less? Suddenly it feels like you just won the lottery, even though youâre really just a penny ahead. According to prospect theory, pricing something just shy of a whole dollarâsay $19.98 instead of $20âis like giving shoppers a tiny mental high-five. It tricks their brain into thinking, âWow, I saved something!â even though the difference is just enough to make the cash register ring louder.
So, sellers love this sneaky trick because the customerâs brain sets the reference point at $20, making $19.98 feel like a steal. Itâs like mental magic, except instead of pulling rabbits out of hats, itâs pulling pennies out of your wallet!
Lucky Number 8: More Than Just a Digit
Why is the number 8 the superstar of price endings in Asia? Well, itâs not just because it looks coolâitâs got some serious good vibes going on. In Chinese culture, the number 8 (pronounced bÄ) sounds a lot like fÄ, which basically means cha-ching!âthink wealth, fortune, and all the good stuff that makes your wallet happy. Because of this happy little language coincidence, 8 has been riding the lucky train for centuries.
So lucky, in fact, that on 08/08/2008, Chinese couples treated it like the ultimate wedding hashtag dateâgetting hitched on the luckiest day ever. Whether those marriages were magically happier? Thatâs still a mystery, but hey, the sentiment counts! On the flip side, the number 4 (sĂŹ) is basically the party pooper of digits because it sounds like the word for âdeath.â Yeah, not great for business or romance.
In places like China, Malaysia, and Hong Kong, where Mandarin and Cantonese reign supreme, sellers love to slap an 8 at the end of their prices and avoid 4 like itâs a bad Tinder date. One study found that nearly 40% of prices in Chinese and Taiwanese ads ended with an 8, while a measly 1.4% ended in 4. Singaporeâs newspapers showed the same trend, with about 31% of prices rocking the lucky 8. Researchers say itâs basically the traditional Eastern cultureâs way of saying, âHey, good luckâand maybe buy this!â
And if you want the ultimate jackpot, check out Macau casino hotels, where prices ending in 8 are practically a VIP club all their own.
So next time you see an 8 at the end of a price tag in Asia, rememberâitâs not just a number, itâs a whole vibe. And maybe a little superstition sprinkled on top for good measure.
BeyoncĂŠ of Numbers in Asia
Alright, buckle upâbecause the number 8 isnât just lucky in China, itâs basically the superstar of good vibes all across Asia, including Japan! In Japan, the number 8 isnât just a digit; itâs a little mountain. Yep, the Japanese script for 8 looks like a mountain, called âSue Hiro-gari,â which sounds fancy but basically means âfanning outâ or âgrowing bigger and better over time.â So, itâs like the number 8âs telling you, âHey, keep buying stuff and youâll get richer⌠or at least your wallet will feel happier!â
Because of this mountain-of-good-luck vibe, Japanese sellers also love slapping an 8 at the end of their prices. Itâs like a secret code for prosperity that only savvy shoppers decode.
Now, hereâs a fun fact: a study scoured through Asia like a detective on a mission and found that prices ending in 8 were the top dogs in Malaysia, Hong Kong (where Cantonese rules), Japan, and of course, China. Basically, if youâre pricing something high-end, throwing an 8 at the end is like giving your product a lucky rabbitâs footâbut way cooler and less creepy.
Why? Because when the price tag has an 8, shoppers donât just see a numberâthey see a future filled with prosperity, growth, and maybe even a mountain of money. Well, maybe not literally, but itâs enough to get them to hit âAdd to Cart.â Meanwhile, prices ending in 9, which are the go-to in the West, play second fiddle in large parts of Asia. Sorry, number 9âyouâre just not that lucky over here.
So next time youâre shopping in Asia and see prices ending in 8, remember: itâs not just clever marketing, itâs a cultural love letter to prosperity, growth, and a little mountain of good fortune on your receipt.
Is price a game?
In 1997, game theory was applied to demonstrate that rational consumers consider the time and effort involved in price evaluation. According to Basu, such consumers tend to process prices from left to right and mentally approximate the last two digits of the price based on the average "cent component" across the marketplace. In a sufficiently large market, this behavior allows individual sellers to set the highest possible cent componentâtypically 99 centsâwithout significantly altering the market average or influencing consumer purchasing decisions. Supporting this theory, a laboratory study by Ruffle and Shtudiner (2006) provided empirical evidence for Basuâs 99-cent pricing equilibrium, especially in contexts where consumers can observe the prices set by competing sellers.
Numbers arenât just numbers
Numbers arenât just numbersâtheyâre like little cultural celebrities strutting their stuff in the marketplace. Both the meaning behind these digits and the whole dance between sellers tossing out prices and buyers deciding whether to say âyesâ or âno thanksâ come packed with cultural flair. Believe it or not, peopleâs superstitions and cultural beliefs about numbers have a surprisingly powerful say in what price tags look likeâyes, even down to that tiny last digit.
In the U.S. and many Western countries, slapping a 9 at the end of a price is basically marketing magic. Sellers are thinking, âHow can I trickâoops, I mean convinceâmy customers that theyâre getting a deal?â And thanks to some quirky brain shortcuts, a price ending in 9 makes shoppers underestimate the cost and feel like theyâre snagging a bargain. Itâs like the number 9 is wearing a sneaky little disguise that says, âIâm cheaper than I really am!â Western sellers love this psychological hackâitâs basically the retail version of a clever magic trick.
But in Asia, things get a bit spicier. Sure, the brain still does its neat tricks with 9-ending prices, but sellers donât bother trying to fool customers with psychology alone. Nope, theyâre too busy tapping into some serious cultural mojo. Their motto? âWhy settle for a sneaky 9 when you can invite good fortune and prosperity with a lucky 8?â So, instead of focusing on the customerâs reaction, Asian sellers lean into superstition and tradition, choosing prices that end with 8 to send a big olâ âgood luckâ shout-out to both their business and their buyers.
So, whether itâs clever psychology or good luck charms, one thingâs clear: numbers have more personality in the marketplace than you might have guessed!
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