Consumers' perception of odd-ending prices with the introduction of the Euro

Authors: Guido G.; Peluso A.

Source: Journal of Product and Brand Management, Volume 13, Number 3, 2004 , pp. 200-210(11)

Publisher: Emerald Group Publishing Limited

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Abstract:

This paper analyzes: the psychological effects that the introduction of the Euro in Italy has on consumers; and their perception of Euro odd prices, that is those prices that fall just below a round number. The aim is to provide some answers to an important question for retailers: How profitable is using odd prices expressed in Euros instead of in the old currency? Results show that consumers, sometimes, prefer round prices rather than odd-ending ones, although the latter elicits a discounted-price image more than the corresponding round one. Moreover, consumers tend to underestimate odd prices during perception and to convert them into Lire through an approximation heuristic strategy. In certain choice sets, odd prices are likely to affect the consumers' heuristics.

Keywords: Consumer Behaviour; Euro; Currencies; Pricing

Document Type: Research article

DOI: http://dx.doi.org/10.1108/10610420410538096

Publication date: 2004-03-01