Individualshave wondered whether economic pricing makes any economic sense, butwhat they should know is that it really does make economic sense.When a business uses the odd pricing strategy, the business is likelyto increase its sales since the odd pricing plays with the psychologyof the buyer, making him/her purchase a commodity thinking that thereis a considerable decrease in the price of the commodity (Diana,2012). For instance, instead of pricing a commodity at $ 40, abusiness may opt to price the commodity at $ 39.5. The difference inthe price of the commodity with $0.5 may make customers to considerpurchasing the commodity from the business or even purchase more ofthe commodity. Therefore, a business is likely to make a lot of salesthrough the use of odd pricing (Lewis, 2013). This makes odd pricingstrategy to make economic sense since it is the aim of any businessto reach out for the extra dollar.
Althoughsome individuals have perceived some pricing strategies such as pricediscrimination as being unethical, they are not unethical at times.It is important to see pricing strategies such as pricediscrimination, odd pricing, two-part pricing, and cost-plus pricingas being ethical since both the buyer and the seller have informationof the difference in pricing (Nyandat, 2013). For instance, in pricediscrimination, a business may price the same commodity differentlybased on the market segmentation. In such a case, a customer is freeto choose the price he/she can afford. Therefore, these pricingstrategies are not unethical. Nevertheless, these pricing strategiescan be seen to be unethical in case they violate price-fixingregulations, as well as anti-trust laws. For instance, pricing acommodity based on the race, nationality, or even religion of anindividual.
Diana,M.V. (2012). Marketing Issues in Assigning Odd Prices by the RomanianRetailers. Socialand Behavioral Sciences,Vol. 62, p 744 – 748.
Lewis,S.M. (2013). Odd Prices at Retail Gasoline Stations: focal PointPricing and Tacit Collusion. Forthcomingin the Journal of Economics and management Strategy,1-32.
Nyandat,C. (2013). What are Ethical Issues in Pricing? GAKSU,pg 1-2.