Pricing Philosophy

[Tallone]

My wife and I both sell stuff on ebay. We have been having a debate about how to price things. Our debate only pertains to relatively common items. In other words, items that you would expect to find several listed on ebay at any given time.

My wife likes to price things $0.01 below a given amount. On the other hand, I would price the item with an even dollar amount. For example, she would price an item at $19.99 but I would price the same item at $20.00. My theory is that if someone is searching for this item, they are looking to pay as little as possible. If they include a price filter in their search (say, $20 - $29.99) and then sort the results with lowest price first, my item will show up at the top of their list. If the same person set the price filter to the next lower $10 increment ($10 - $19.99) and again sorted low to high, my wife's listing would be at the bottom of the list.

So, the question is: which pricing method would get better results? Or maybe it doesn't matter a hill of beans. Anyway, I'd be interested to hear other's points of view on the matter.

 

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[Joe777Cool]

I have been using eBay for 13+ years and I don't think I have ever searched for something by price. IF I did, however, I doubt I would be searching $10-10.99, it would most likely be $10-20. If I am looking for something and price is an issue, I sort by price from lowest to highest and then make my buying decision. Since your pricing is 1 cent higher than your wife's, her item will come up first. If all other things are equal (ie shipping and feedback) I'd probably buy from her.

 

[Tallone]

I have been using eBay for 13+ years and I don't think I have ever searched for something by price. IF I did, however, I doubt I would be searching $10-10.99, it would most likely be $10-20. If I am looking for something and price is an issue, I sort by price from lowest to highest and then make my buying decision. Since your pricing is 1 cent higher than your wife's, her item will come up first. If all other things are equal (ie shipping and feedback) I'd probably buy from her.

Actually, you just made my point, Joe. Let's say my wife and I are going to list identical items. We both think it should sell for around $10. I list it for $10.00. My wife lists it for $9.99.

Now Joe comes along looking to buy this item. You search for the item on ebay and sort the results with lowest price first. Your search turns up many hundreds of similar items of various styles, colors, and condition. Because you did your search with no price filter, all the crappy ones are listed with a low price so you have to scroll through dozens of listings looking for one you want to buy. So, you run your search again but this time with a price filter in the range of $10 - $20 because:
1) you planned on spending about this much to begin with;
2) these are easy numbers to enter and most importantly;
3) you will save a lot of searching time by removing all the poor quality items from the list.

You run the search with the price filter and sort the results by price low to high. My item will be at the top of your list while my wife's won't be on it at all.

Also, I believe people tend to think in round numbers. Let's say I want to buy my wife a birthday gift. My first decision is, "how much do I want to spend?" I would think, "I am willing to spend $50 - $60". I would NOT think, "I am willing to spend $50 - $59.99". You illustrated this point yourself, Joe (see your comment highlighted in red above).

 

[Joe777Cool]

I think you missed my point. I have never searched a price range like that. I find the item I want, say "1994 silver eagle" fthen sort price from low to high. In my opinion, her item will come up before yours more frequently because the price is lower, even if it is only 1 cent.

 

[mkulltra]

I believe there is an ebay app that can help answer your questiin. It will actually tell you how many times your listing is shown in users search results and how high. Simply list the same item with aame everything except price and see what happens.

IMO, the more important thing to be concerned with is your listings title. This is how people really find most items on eBay. You listing is indexed by Google and someone searching for that item will see your listing from a Google search. The more Google searches your listing shows up for, the more viewers on your item. Think about what you might put into Google to find your item when creating listing.

 

[crhstreetwalker]

What type of items are you selling?

 

[diggummup]

I always list mine with a .99 ending. On ebay, I never search by price either, it's always low to high or vice versa.

 

[Paleo_joe]

I too never set a pricing filter when searching. I sort the entire list low to high or vice versa. But that may be because the things I search for or the keywords I use don't return hundreds of hits.

I look at the .99/.00 issue as one of psychology. I recall restaurant menu data, but I think there are other examples as well. For those who are price sensitive, .99 or .95 is better than a whole number. For premium items, a whole number is better because .99 and .95 are seen as cheap. An example is a McDonald's menu vs. a menu at a high end steakhouse. There are exceptions of course.

That is for fixed pricing. For auctions I think a starting bid with a .99 is always better.