Is 99 just for flakes?

This is just about a pet peeve of mine!!

I have to admit that I absolutely hate the trend of adding a 99p onto a price point in the foolish belief that this ‘confuses’ or ‘bamboozles’ the Customer into believing that they are paying ‘less’ or ‘not as great’ an amount.

You tend to see this on larger priced items – therefore you buy a Sofa for £499 rather than over £500 - Only a penny difference!  This has also become a trend for clothing retailers over the last couple of, however are the general public really falling for this?

Price points have become more and more critical with the recession and the confusion over the lowering and then increase around VAT has also not helped.

When the Chancellor announced that the standard rate of VAT was to be reduced from 15% from the 1st December 2008', this was seen as a positive move for the economy.

Many Retailers removed the reduction in VAT at the Till Point - therefore the labelled price of a garment could confuse the Customer - or delight them when slightly less was needed when they came to pay.

However, with VAT having returned to its previous 17.5% from 1^st January 2010, where does this leave Retailer pricing?

It seems that the Stores which have pricing that hits the pound are also bucking the trend and are reporting year-on-year growth – Primark works on an extremely competitive price arc and all items are clearly marked. Has this been part of their strategy for success?

I always prefer to have a clear understanding of what the goods I am purchasing cost and believe that to price something just under the pound by using the ‘99p’ tactic is a pointless exercise.

After all – who wants to spend a penny anymore????