Hacker News Reader

Comment by hartator | Hacker News Reader

> $X.99 pricing is not generally used in B2B or prosumer (professional consumers) services because it communicates cheapness; I’d suggest you drop the 0.99 accordingly here, for aesthetic reasons. (No series of A/B tests I’ve ever done generated as many strong opinions as whether it was better to price a product at $49, $49.99, or $50. Despite bikeshedding this to death at several clients, I’ve yet to see it really matter, so aesthetics win the day. If your data says differently, trust the data.)

Interesting, I would have said $X.87 is still the best strategy when talking pricing/extracting value, even for B2B.

View on HN

Why $X.87 ?

I've seen $X.99 versus the $X but never $X.87

Hazard a guess: where .99 lowers the leading digit and feels "cheap", .87 feels more precise than a round number like X.00. Even if it's entirely arbitrary, it carries weight of apparent calculation behind it.

Does anyone have any science to hack this up?

> hack this up

I had to chuckle a bit. So you want some science to discredit the idea?

I will try and find the book, but their is research behind arbitrary pricing. Hardware stores for example often use exact sounding pricing because the consumer is making a rational purchase rather than an emotional one, and a price that seems calculated based on real value aligns well. The 478 dollar drill must cost that much because of the precise materials used to build it. Compared to the 199 dollar one which is obviously made of cheap materials and marked up.

I would never go for .87 as it is confusing number and forces the user to go out of the comfort zone. I would always suggest going after 9 or 7 at the end, and the full dollar. I have quite an experience in pricing, and prices ending with "7" helped to convert more on the fence users (and cheap ones too, so if you offer live support, I would avoid that), while with "9" I would get less troubling customers, but I would see a slight dent in revenue numbers (out of every 50 customers buying at price ending with "7" I would probably see around 3 less with prices ending with "9"). The sample for this is few thousands of customers, that I had to cater for personally.

Similar to Walmart pricing. I rarely see it is SaaS though.

Reply on news.ycombinator.com