psychological pricing advantages and disadvantages
Psychological pricing refers to the practice of setting the price of a product at a slightly lower than absolute numbers so that consumer treat the price as a lower price.
Advantages of psychological pricing
1) Increase in sales - Psychological pricing attracts more consumers as it serves as a psychological tool to convince consumer about a slightly lower price of a product.
2) Customer satisfaction- Psychological pricing makes consumers to think that they have spent less money than they actually pay. This results in better consumer satisfaction.
Disadvantages of psychological pricing
1) Difficulty in aggregates- Psychological pricing of all the products results in a complication for consumers to sum up the total expenditure on all the items in the bill.
2) No substantial sales- Although such way of pricing increases sales, but it cannot result in any substantial rise in the sales.
Advantages of psychological pricing
1) Increase in sales - Psychological pricing attracts more consumers as it serves as a psychological tool to convince consumer about a slightly lower price of a product.
2) Customer satisfaction- Psychological pricing makes consumers to think that they have spent less money than they actually pay. This results in better consumer satisfaction.
Disadvantages of psychological pricing
1) Difficulty in aggregates- Psychological pricing of all the products results in a complication for consumers to sum up the total expenditure on all the items in the bill.
2) No substantial sales- Although such way of pricing increases sales, but it cannot result in any substantial rise in the sales.