Direct evidence of ending-digit drop-off in price information processing
Abstract
Research has suggested that pricing products at one cent below a whole number (e.g., $4.99 instead of $5.00) can be an effective method for increasing purchases. Although many reasons for this have been suggested, a commonly proposed explanation is that consumers tend to drop off, or pay less attention to, the rightmost two digits. This drop-off mechanism has garnered much indirect support, but only limited research has been conducted to directly test it. In this study, respondents provided estimates of how many products they could purchase for $73. Analyses indicated that respondents thought they could buy significantly more products priced with 99 endings than products with comparable 00-ending prices. Follow-up analyses showed that (a) errors made by respondents showed a pattern consistent with a dropoff mechanism, and (b) motivation to carefully provide quantity estimates moderated the effect. The study therefore provides rare direct evidence that the drop-off mechanism may contribute to the effectiveness of 9-ending pricing. © 2005 Wiley Periodicals, Inc.
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Just-below pricing exploits a heuristic wherein decisionmakers focus disproportionately on the leftmost integer while ignoring fractional cents.
“Just-below pricing (e.g., pricing an item at $4.99 rather than $5.00) exploits a heuristic wherein decisionmakers focus disproportionately on the leftmost integer while ignoring fractional cents (Bizer and Schindler, 2005;Thomas and Morwitz, 2005;Kraft and Rao, 2026;Lacetera et al., 2012).”
From Shopping by algorithm: How agentic AI deploys human heuristics as a surrogate consumer (2026) · cites this paper as Bizer and Schindler, 2005
Cites
Tversky, A., & Kahneman, D. (1974) · Science · doi:10.1126/science.185.4157.1124 · Cited by 28,810 · see citing works
Effects of $9 Price Endings on Retail Sales: Evidence from Field Experiments
Anderson, E. T., & Simester, D. I. (2003) · Quantitative Marketing and Economics · doi:10.1023/a:1023581927405 · Cited by 247 · see citing works
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Brain Drain: The Mere Presence of One’s Own Smartphone Reduces Available Cognitive Capacity
Ward, A. F., Duke, K., Gneezy, A., & Bos, M. W. (2017) · Journal of the Association for Consumer Research · doi:10.1086/691462 · Cited by 787 · see citing works
Shopping by algorithm: How agentic AI deploys human heuristics as a surrogate consumer
Wadi, D., & Ma, Y. (2026) · arXiv · doi:10.48550/arxiv.2609.28372
- Authors
- Bizer, G. Y., & Schindler, R. M.
- Affiliations
- Union College (US)
- Rutgers, The State University of New Jersey (US)
- Corresponding author
- Bizer, George Y.
- Venue
- Psychology and Marketing
- Publisher
- Wiley
- Published
- 2005
- Volume
- 22
- Issue
- 10
- Pages
- 771-783
- ISSN
- 0742-6046 (ISSN-L)
- 1520-6793
- OpenAlex
- W2063922481
- Cited by
- 118
- References
- 2
- Citations by year
- 2026: 9 · 2025: 4 · 2024: 3 · 2023: 6 · 2022: 8 · 2021: 6 · 2020: 12 · 2019: 3 · 2018: 10 · 2017: 6 · 2016: 3 · 2015: 7 · 2014: 12 · 2013: 4 · 2012: 3
- FWCI
- 9.80
- Type
- journal article
- Language
- en
- Open access
- closed
- Locations
- Psychology and Marketing (publishedVersion)
- Topics
- Social Sciences › Business, Management and Accounting › Marketing › Consumer Market Behavior and Pricing
- Social Sciences › Decision Sciences › General Decision Sciences › Decision-Making and Behavioral Economics
- Social Sciences › Business, Management and Accounting › Marketing › Consumer Behavior and Marketing Influence
- Keywords
- quantity estimation, consumer motivation, price anchoring
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