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臺大管理論叢
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26
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2
期
77
information presented in the first store they visited, and then compare it with the information
given in the next store. In both conditions of the virtual and physical stores, the sum of
cognitive effort required to judge nine- and zero-ending prices in the SQE mode is midway
between the SE and JE modes: more effort to make a comparative judgment is required than
in the SE condition and less effort to recall a reference price is required than in the JE
condition.
2.2 Nine-Ending Pricing Effect
Prices can be segmented into two elements: (1) the leftmost digit and (2) the digits to
the right of the leftmost digit, which are known as the ending digits (Bizer and Schindler,
2005; Coulter, 2001). The literature shows mixed evidence as to whether people perceive
products with nine-ending prices to be much lower in price than ones with zero-ending
prices that are one cent or one dollar higher. Several theories have been proposed to explain
the preponderance of nine-ending prices. Stiving and Winer (1997) have explained these
theories and broadly categorized them into image effect and level effect, which are two
consumer behavioral explanations. Image effect includes two aspects: price image and
quality image. Stiving and Winer (1997), and Baumgartner and Steiner (2007) maintain that
price image indicates that the products are on sale and at the lowest price when the prices
end in 99, and quality image assumes that odd prices are considered low-quality products,
while even prices indicate high-quality merchandise (Gendall, Holdershaw, and Garland,
1997; Schindler, 1991, 2001, 2006; Schindler and Kibarian, 1996, 2001; Stiving, 2000).
Level effect can be categorized into three aspects: “rounding down”, “left-to-right
comparison”, and “memory effect”. The rounding down mechanism (drop-off mechanism) is
commonly proposed in support of the effect of nine-ending pricing on magnitude perception
(Bizer and Schindler, 2005; Brenner and Brenner, 1982; Schindler, 1984; Stiving and Winer,
1997). According to this theory, when people see a price, they pay very little or no attention
to the ending digits; hence, the term “price ending drop off” (Manning and Sprott, 2009;
Schindler, 1991; Schindler and Kirby, 1997). For example, when people see a price of $199,
they may perceive the price ending digits as zero, making the price virtually equivalent to
$100. They may also see the price as $200. The former circumstance reflects the tendency of
people to drop off or give less attention to the ending digits of a price.
Bizer and Schindler (2005) have developed a new experimental approach to
demonstrate numerical drop-off and avoid two major causes of failures in research into the
nine-ending pricing effect. These two causes are high variation among open-ended responses