Skip to main content

Effects of $9 Price Endings on Retail Sales: Evidence from Field Experiments

Quantitative Marketing and Economics volume 1, pages 93–110 (2003)Cite this article

Abstract

Although the use of $9 price endings is widespread amongst US retailers there is little evidence of their effectiveness. In this paper, we present a series of three field-studies in which price endings were experimentally manipulated. The data yield two conclusions. First, use of a $9 price ending increased demand in all three experiments. Second, the increase in demand was stronger for new items than for items that the retailer had sold in previous years. There is also some evidence that $9 price endings are less effective when retailers use “Sale” cues. Together, these results suggest that $9-endings may be more effective when customers have limited information, which may in turn help to explain why retailers do not use $9 price endings on every item.

This is a preview of subscription content, access via your institution.

Access options

Buy single article

Instant access to the full article PDF.

USD 39.95

Price includes VAT (USA)
Tax calculation will be finalised during checkout.

References

  • Anderson, Eric T. and Duncan I. Simester. (1998). “The Role of Sale Signs”, Marketing Science 17(2), 139-155.

    Google Scholar 

  • Anderson, Eric T. and Duncan I. Simester. (2001). “Are Sale Signs Less Effective When More Products Have Them?” Marketing Science 20(2), 121-142.

    Google Scholar 

  • Blattberg, Robert C. and Scott A. Neslin. (1990). Sales Promotion: Concepts, Methods and Strategies. Englewood Cliffs, NJ: Prentice-Hall.

    Google Scholar 

  • Daily Mail. (2000), “Asda Axes The 99p Price Ploy”, London, May 22, p. 15.

  • Direct Marketing Association. (2000). State of the Catalog Industry Report, New York: DMA.

    Google Scholar 

  • Gabor, Andre and Granger, C.W.J. (1964). “Price Sensitivity of the Consumer”, Journal of Advertising Research, 4, 40-44.

    Google Scholar 

  • Ginzberg, Eli. (1936). “Customary Prices”, The American Economic Review 26(2), 296.

    Google Scholar 

  • Inman, Jeffrey J. and Leigh McAlister. (1993). “A Retailer Promotion Policy Model Considering Promotion Signal Sensitivity”, Marketing Science 12(4), 339-356.

    Google Scholar 

  • Inman, Jeffrey J., Leigh McAlister, and Wayne D. Hoyer. (1990). “Promotion Signal: Proxy For A Price Cut”, Journal of Consumer Research 17(1), 74-81.

    Google Scholar 

  • Lambert, Zarrel V. (1975). “Perceived Prices as Related to Odd and Even Price Endings”, Journal of Retailing 51 (Fall), 13-22.

    Google Scholar 

  • Salmon, Walter J. and Gwendolyn K. Ortmeyer. (1992). Randall's Department Stores. Harvard Business School Publishing, 9-593-032, pp. 1-24.

    Google Scholar 

  • Salmon, Walter J. and Gwendolyn K. Ortmeyer. (1993). Duncan Department Stores. Harvard Business School Publishing, 9-594-012, pp. 1-36.

    Google Scholar 

  • Schindler, Robert M. (1991). “Symbolic Meanings of a Price Ending”, Advances in Consumer Research 18, 794-801.

    Google Scholar 

  • Schindler, Robert M. and Thomas Kibarian. (1993). “Testing for Perceptual Underestimation of 9-ending Prices”. In Advances in Customer Research, Vol. 20. Provo, UT: Association for Customer Research, 580-585.

    Google Scholar 

  • Schindler, Robert M. and Thomas Kibarian. (1996). “Increased Consumer Sales Response Through Use of 99-Ending Prices”, Journal of Retailing 72(2), 187-199.

    Google Scholar 

  • Schindler, Robert M. and Patrick N. Kirby. (1997). “Patterns of Rightmost Digits Used in Advertised Prices: Implications for Nine-Ending Effects”, Journal of Customer Research 24 (September), 192-201.

  • Schindler, Robert M. and Lori S. Warren. (1988). “Effect of Odd Pricing on Choice of Items from a Menu”, Advances in Consumer Research 15, 348-353.

    Google Scholar 

  • Schindler, Robert M. and Alan R. Wiman. (1989). “Effect of Odd Pricing on Price Recall”, Journal of Business Research 19 (November), 165-177.

  • Stiving, Mark. (2000). “Price-Endings When Prices Signal Quality”, Management Science 46(12), December, 1617-1629.

    Google Scholar 

  • Stiving, Mark and Russel S. Winer. (1997). “An Empirical Analysis of Price Endings with Scanner Data”, Journal of Customer Research June, 57-67.

Download references

Author information

Authors and Affiliations

  1. Graduate School of Business, University of Chicago, 1101 E. 58th Street, Chicago, IL, 60637, USA

    Eric T. Anderson

  2. Sloan School of Management, MIT, 38 Memorial Drive, E56-305, Cambridge, MA, 02142

    Duncan I. Simester

Authors
  1. Eric T. Anderson
    View author publications

    You can also search for this author in PubMed Google Scholar

  2. Duncan I. Simester
    View author publications

    You can also search for this author in PubMed Google Scholar

Corresponding author

Correspondence to Eric T. Anderson.

Rights and permissions

Reprints and Permissions

About this article

Cite this article

Anderson, E.T., Simester, D.I. Effects of $9 Price Endings on Retail Sales: Evidence from Field Experiments. Quantitative Marketing and Economics 1, 93–110 (2003). https://doi.org/10.1023/A:1023581927405

Download citation

  • Issue Date:

  • DOI: https://doi.org/10.1023/A:1023581927405

  • price ending
  • odd-pricing
  • pricing
  • catalogs