19 Sneaky Pricing Tricks Retailers Use to Make You Spend More
Retailers use sneaky psychological pricing tricks, like fake discounts, misleading "free" offers, and strategic price anchoring, to make you spend more while thinking you're saving money.
- Alyana Aguja
- 6 min read
Shoppers employ slick psychological manipulations to get you to spend more without realizing you’re getting a fantastic bargain. From pseudo-discounts and price anchoring to the trickery of “free” shipping and hidden BOGO scams, all of these strategies are crafted to distort your value perception. Being aware of these tricks, such as why prices are listed in .99 increments or why designer goods at outlet stores are inferior quality, can help you in beating the system and keeping more cash in your wallet.
1. The “9” Trick (Charm Pricing)
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Do you ever wonder why most prices end in .99 rather than a round figure? According to a study conducted jointly by MIT and the University of Chicago, the product sold at $39.99 outsold the same product at $34.00 simply because it appeared cheaper. JCPenney and Walmart, among others, employ it to trick you into believing you are paying less, though you’re not.
2. The Decoy Effect
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Cinemas such as AMC charge small popcorn at $4, medium at $7, and large at $8. The medium only serves to make the large seem like a bargain. However, you wouldn’t have thought so otherwise. Apple also did this with three storage capacities for the iPad to push individuals toward the most lucrative middle-range model.
3. Shrinkflation (Same Price, Less Product)
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Your favorite package of Lay’s chips may still be $3.99, but notice the weight—it’s likely to be less than last year. Companies subtly cut size rather than increase price, so you’ll feel like you’re still getting the same bargain. Hershey’s, Gatorade, and even Domino’s Pizza have done this.
4. False “Was/Now” Discounts
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Department stores such as JCPenney and Kohl’s were found to be jacking up prices first and then offering them on “sale.” A $50 shirt was originally priced at $75 and then “on sale” at $49.99, so you think you’re getting a bargain. In 2016, JCPenney settled millions in fake discount lawsuits.
5. Limited-Time Pressure (FOMO Pricing)
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Amazon’s Lightning Deals and Best Buy’s “Deal of the Day” have you fright-purchasing before the clock expires. The pressure takes over your brain, causing you to spend first and think later. Most of these promotions recycle frequently, but you wouldn’t know if retailers didn’t profit from you.
6. Bizarrely Specific Price Points
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Instead of $50, why does something cost $49.83 at places like Home Depot? Research shows that precise pricing makes people think the price is calculated fairly, so they trust it more. Apple and Dell use this strategy in their product pricing, too.
7. BOGO That Isn’t a Deal
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Buy-One-Get-One (BOGO) is like having money for free, but retailers charge more before launching the promotion. Walgreens, for instance, was found padding the price of vitamins before the BOGO discount in 2018, with customers paying as much as the “free” item.
8. Anchor Pricing (Making Expensive Seem Normal)
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When Williams-Sonoma initially came out with a $275 bread maker, nobody purchased it. However, when they also introduced a larger, more elegant one for $429, the $275 one flew off the shelves because it now seemed reasonable. This is why stores place expensive products at the front, so the rest of the items appear less expensive by comparison.
9. The Costco Effect (Bulk Buying Illusion)
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Costco and Sam’s Club lead you to believe that it always pays to buy in bulk. However, in some cases, per-unit prices are greater than purchasing smaller packs elsewhere. It was discovered through a 2019 study that a box of cereal at Costco costs more per ounce than it did at Target.
10. The Small Price Difference That Makes a Huge Impact
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UberEats charges $0.49 vs. $0.50, and guess what? More people tap on $0.49 delivery charges, even though the difference is irrelevant. A 2018 test by Gumroad demonstrated that charging a product $4.99 rather than $5.00 boosted sales by 23%.
11. The Phantom Discount Trick
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Retailers like Macy’s and Amazon tend to pad “original” prices to make the discount appear larger. A $200 jacket “now $99” sounds wonderful—except it was never sold at $200. Amazon was even probed for putting up phony reference prices on Prime Day.
12. “Free Shipping” That’s Built into the Price
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Have you ever seen how “free shipping” suddenly became the norm, but things cost more inexplicably? Shops like Etsy and eBay increase the price of the items, so they can offset with shipping, and you’ll think you’re saving money. Actually, you’re just paying for it—in another way.
13. The Target Effect (Low Price Loss Leaders to Bring You In)
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Stores like Target and Walmart promote ridiculously low prices on particular items simply to bring you in the door. After entering, research indicates that shoppers end up spending a minimum of 50% more than intended. This is why Target puts affordable essentials at the back, making you pass by impulse buys.
14. The “Dotted Line” Payment Trick
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Stores hardly ever quote the full price upfront. Instead, they emphasize the monthly charge. Car lots, mattress stores, and even Apple financing options make pricey items look affordable. A $1,200 phone is painless at “$33/month”—until you calculate it.
15. Designer Outlet Store Lies
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Think outlet stores sell overstock high-end merchandise? Nope—most “outlet exclusives” are lower-quality versions produced for outlets. Michael Kors, Coach, and Nike have all conceded that most outlet merchandise was never even sold in ordinary stores at full price.
16. The “IKEA Effect” (You Value It More If You Assemble It)
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IKEA prices seem low, but studies show people overvalue things they “build” themselves. Because you assemble the furniture, your brain thinks it’s worth more than it actually is. This trick is why fast-food places like Subway and Chipotle let you “customize” your meal.
17. The Penny Gap (Making You Think Twice Before Leaving a Deal)
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Ever notice a discount of $5.01 instead of $5.00? That single penny makes the bargain seem greater, tricking your mind into taking action. Amazon, Walmart, and even gas stations employ this tactic to make small differences in price seem substantial.
18. “Recommended for You” Pricing Manipulation
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Stores monitor your browsing history to display more items they believe you will buy. In 2012, Orbitz discovered that customers using Macs spent more on hotel stays, so they displayed more expensive options to Apple users. Even Amazon prices vary depending on the place and the internet search.
19. The “Gift Card Trap”
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Ever had a $5 left on a gift card but nothing cheap enough to buy? Retailers design it this way, so you either let it expire or spend more to use it. In 2022, over $21 billion in unused gift cards sat in limbo—free money for stores.