What is Psychological pricing & how it affect the buying power...

Psychological pricing is a marketing/business concept which is used to influence the consumer buying power. Customers respond better to certain type of prices & they are more likely to buy with certain price levels. Psychological prices more often ends with the 9 digit. For example, 99.99, 9999.99, 99,999.99, etc.These kind of prices of course does not have any effect on the monkey what we are going to pay. Even if it is 999.99 we are going to pay 1000.00 & even if it is 1000.00 we are going to pay the same. 

But this of prices can psychologically hit the consumer buying power. It gives a different mind set to the buyer at the first sight. when we see a price at 10,000 it seems like big. Same time though there is only one penny difference if we see the price as 9999.99 we feel as less. That one penny difference hit the consumer mind in a large scale. 

At textiles, groceries, electrical item shops... where ever we go we can see this psychological pricing. Most of the people would not have thought about this pricing though they purchase at those pricing levels.

There are some consumers who measure the quality by the price. If the price is high they feel the product is high quality vice versa. This type of consumers always focus on the price. They do not accept the same product with same quality if there is a price variation. 

But these Kind of consumers are rare. Most of us go for low pricing. Psychological pricing can influence the consumers who go for the lowest price in a large scale.