TY - JOUR

T1 - A meta‐analysis on the effects of just‐below versus round prices

AU - Troll, Eve Sarah

AU - Frankenbach, Julius

AU - Friese, Malte

AU - Loschelder, David D.

N1 - Publisher Copyright: © 2023 The Authors. Journal of Consumer Psychology published by Wiley Periodicals LLC on behalf of Society for Consumer Psychology.

PY - 2024/4

Y1 - 2024/4

N2 - Marketers' proclivity for just-below prices (e.g., $9.99) is rooted in an expected higher demand than for round prices ($10.00). The literature, however, lacks a comprehensive assessment of when and how price endings matter. Three mechanisms might explain price-ending effects on consumers' purchase decisions: just-below prices (1) improve price perceptions, but (2) impair perceived product quality, and (3) cause consumers to underestimate prices. A preregistered meta-analysis (k = 69 studies, m = 362 effect sizes, N = 40,541) established that just-below (vs. round) prices tend to increase purchase decisions (g = 0.13, CI 95%[0.01, 0.25]), result in an advantageous price image (g = 0.28, CI 95%[0.09, 0.48]), have no effect on perceived product quality (g = 0.00, CI 95%[−0.17, 0.18], p = 0.96), and are more often underestimated (g = 0.67, CI 95%[0.04, 1.30]). Participant, study, price, and product characteristics moderate the magnitude of these effects. Overall, the effect sizes are small and highly heterogenous, p-curve analyses revealed a large proportion of nonsignificant effects, and publication bias corrections suggest smaller and, at times, nonsignificant true effects. We discuss theoretical and applied implications for the pricing literature.

AB - Marketers' proclivity for just-below prices (e.g., $9.99) is rooted in an expected higher demand than for round prices ($10.00). The literature, however, lacks a comprehensive assessment of when and how price endings matter. Three mechanisms might explain price-ending effects on consumers' purchase decisions: just-below prices (1) improve price perceptions, but (2) impair perceived product quality, and (3) cause consumers to underestimate prices. A preregistered meta-analysis (k = 69 studies, m = 362 effect sizes, N = 40,541) established that just-below (vs. round) prices tend to increase purchase decisions (g = 0.13, CI 95%[0.01, 0.25]), result in an advantageous price image (g = 0.28, CI 95%[0.09, 0.48]), have no effect on perceived product quality (g = 0.00, CI 95%[−0.17, 0.18], p = 0.96), and are more often underestimated (g = 0.67, CI 95%[0.04, 1.30]). Participant, study, price, and product characteristics moderate the magnitude of these effects. Overall, the effect sizes are small and highly heterogenous, p-curve analyses revealed a large proportion of nonsignificant effects, and publication bias corrections suggest smaller and, at times, nonsignificant true effects. We discuss theoretical and applied implications for the pricing literature.

KW - Management studies

KW - just-below prices

KW - meta-analysis

KW - price endings

KW - pricing

KW - round prices

UR - http://www.scopus.com/inward/record.url?scp=85159816067&partnerID=8YFLogxK

UR - https://www.mendeley.com/catalogue/aef7ba5e-975e-337e-854e-ef935aaeb99f/

U2 - 10.1002/jcpy.1353

DO - 10.1002/jcpy.1353

M3 - Journal articles

VL - 34

SP - 299

EP - 325

JO - Journal of Consumer Psychology

JF - Journal of Consumer Psychology

SN - 1057-7408

IS - 2

ER -