Effect of Psychological Pricing on Consumer Buying Behaviour

Abstract

Consumer behaviour is a topic most sought after when it comes to creating successful marketing practices that affect consumers' psychology, acting as a stimulus and inducing them to make purchases. Evidence explains that the psychological pricing strategy communicates with the subconscious mind of consumers, creating a perceptual illusion. This makes the deal seem more appealing to them. This chapter entails a practical study examining the impact of psychological pricing strategies on consumers' buying behaviour. This study has used authentic primary data that has been collected directly from consumers in India based on their buying experiences when encountering psychological pricing. The findings of this research show how socio-demographic factors like age, income, education, gender and family size influence consumers' buying behaviour when encountered with psychological pricing and if psychological patterns such as the anchoring heuristics, recency bias, scarcity effect and halo effect can overpower the influence of psychological pricing strategies in consumer buying behaviour.