Pricing Products
We are getting ready to launch an AHHH-MAZING new CBD and sexual wellness brand called Simon Wolff. (More on that next week!).
They brought us on as their head of brand, and we have been brand building together since the day we met. Although we don't consider ourselves experts in e-commerce sales, we do consider ourselves expert generalists.
What does this mean you ask? It means that it is our job to stay up to date on the latest trends and happenings in the lifestyle space. So much of today's marketing strategy (if you're doing it the right way, in our opinion) comes from an intuitive marketing approach.
It was our intuition to price Simon Wolff products using whole numbers, instead of with cents attached to them. We then did a little research--just to gut check, and here is what we found:
Studies show that the 99 cent model is outdated- this article explains that “In the age of debit cards, online commerce, and pay-what-you-want (PWYW) pricing models, consumers have more control than ever before over what they’re willing to spend. And mounting evidence suggests that consumers’ desire to deal in clean, round numbers trumps their hope that odd prices signal some kind of sale.”
Read more here.
Because we’re launching in the wellness/beauty space, For reference, here are links to the shop pages of hugely successful current beauty brands who all use whole numbers (there are a million more examples- in fact we actually struggled to find examples of current brands who ARE using 99 cent, even outside the beauty world. Here are just a few.):
https://www.drunkelephant.com/collections/shop
https://www.glossier.com/products
https://www.tatcha.com/category/shop-all/?page=1
https://www.origins.com/whats-new
https://theouai.com/collections/all
Notice that many of these companies don’t even include “.00” simply just the number. Ex. “$16”. It’s cleaner, simpler, and attractive.
There are undoubtedly thousands of studies over the years about the 99 cent model and how it’s done wonders for companies. But, they use case studies from companies that started years ago.
There aren’t many studies on the round number approach YET. But that’s what we’re here for: to share observations and patterns from current, innovative brands. From a branding point of view, whole round numbers are the current approach. Today, at first glance, the 99 cent looks like the product is cheaper, discounted, and more outdated. Consumers today value transparency, they don’t want to feel like they’re being tricked by marketing schemes.
That’s our 2 cents— pun intended!