How to Out-Think the Mind Games Retailers Play

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How to Out-Think the Mind Games Retailers Play

If you want to save serious money, you have to be on guard and recondition yourself. Here’s how some of it works and how to out-think the mind games retailers play.

Left-digit anchoring:

The first concept to recognize and combat is what is known as “left-digit anchoring”. In English, we read left to right. When we learn to read, we’ve trained our brains to read the beginning and ends of words and our mind fills in the rest. Thts wy yu cn stl rd ths sntnce. Even though most of the letters are missing, your brain still fills them in, giving meaning to what your eyes pick up. The same is true of numbers. In pricing, whatever the first digit becomes the “anchor” digit for comprehending the price. That’s why something marked $3.99 causes us to think “3”… and nothing else. We don’t think “4”.  Even though the price is actually only 1 penny away from $4.


Why retailers use it:

Because it works – and has for well over 100 years. We’ve been so conditioned to seeing prices this way, rounded prices seem out of place and not real. Anchor digits make prices seem lower. And that causes us to buy. When considering prices that end within a penny (or three) of the next dollar, we’re thinking nearly $1 lower while the retailer is actually getting more money from us.


The extra twist retailers added in recent years:

Think about this: Ever notice how you tune into prices that don’t end in .99? What about items that are, say $3.29 or $4.49? Even though your brain still anchors to the first number, you do tend to notice the second numbers more. Why is that? Because they are less common. But for retailers, it’s okay that you notice because the pull of that left-digit anchor is so strong, you find yourself saying, “Eh, it’s only a bit more. That’s cool.” And you still buy.


Why JCPenney thought exposing this psychology would work but it tanked:

Over 7 years ago, JCP came up with a pricing strategy called “Fair and Square”. Instead of using the left-digit anchor trick against consumers, they were going to use all round number pricing. For instance, a blouse on sale that would have been marked $39.99 under the old sale pricing model was now marked $40. JCPenney was certain modern consumers wanted more honesty in pricing and would respond positively to this transparency. They predicted a boost in sales and customer loyalty. They experienced the opposite.

Why? First of all, the left-digit anchor psychology pulls more strongly than JCP estimated. Customers perceived the new pricing as more expensive, even when prices were technically only a penny higher.  

Secondly, consumers just weren’t used to it. Unlike how retailers have successfully added .29 or .49 onto pricing (raising product prices from previous .99 endings), JCP drew negative attention for making their prices more noticeable. It triggered a closer look into how JCP’s prices things in the first place. Structured to show high “suggested retail” first, JCPenney’s prices are then discounted. This technically brings the price closer to the true value. Drawing additional attention to this caused customers to lose trust in JCPenney. But it had worked for them in the past, so, interestingly, they returned to the old pricing model.


Not falling victim to “bundle” or “multiples” pricing:

This is when retailers get you to spend more by making products 4 for $10, for example. The psychological game is that items appear cheaper and bundled together like you have to get 4 of them, which causes you to buy more.



How to retrain your brain and out think the mind games retailers play:

  1. Read prices from right to left. Instead of quickly glancing at the price and falling victim to left-digit anchor psychology, read prices backward. If something is $4.99, read it as 99 – 4. Reading 99 first will make you think “100” – automatically rounding up. Then your brain will convert 100 cents to another dollar and add it to $4. This results in more accurately reading the price as $5. You’ve disabled the left-digit anchor.

  2. Use coupons and discounted gift cards. Retailers may play psychological pricing games but they also offer discounts. Take advantage of them! I recommend Swagbucks to save every day.

  3. Question “bulk” or “multiples” pricing. Unless otherwise stated, you should be able to buy just one at the sale price. (From our example, for $2.50.) Also, compare the sale price to regular retail. “Multiples” pricing is often used to mask only giving a modest discount on each item. The savings appear larger because it’s multiplied by the number of items. Back to our example: If the items are already normally only $2.29, you’re actually saving a mere 84 cents total. But the store tricked you into buying 4.

  4. Beware discounting from suggested or regular retail. Just like #3 above and how JCP prices, don’t get sucked in by discounts that only appear deep. Know the reasonable retail at other stores.

More ways you can save:

2 Sneaky Ways Retailers Get You to Spend More

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Written by Josh Elledge - Chief Executive Angel

Josh Elledge Consumer Savings Expert and Founder/Chief Executive Angel,®

Josh Elledge is on a mission to help Americans save money and time so they can give. He is Founder and Chief Executive Angel of®, which was created to bolster the buying power of the average U.S. family by combining technology, coupons and smart thinking for extreme savings on household consumables and everyday items.

Through his work with, Elledge has emerged as one of the nation's leading experts on consumer savings appearing in the media more than 2,000 times!


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