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Joined: 1/1/0001
Posts: 0
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But, I have to assume that if paying $69.99 for iFly GPS causes you heartburn, paying $X.99 for any other product would do the same, expecially if you're paying cash for something and have to put that dreaded penny in your pocket. Over time, all those penny's add up to dollars, then 10's, then 100's, etc.
I do understand, but don't agree with, your feeling of being insulted by pricing strategy. Businesses do NOT price products to make a certain margin. They price based on what the market will bear. One product might make 100 percent margin and another 20 percent. The sum total of all their revenue and all their cost would determine their overall profit margin.
Who pays list price for a car? If a car list for $49,999 you might get it for $42,500. You certainly aren't going to offer $42,499. I suspect there is some very, very small psychological incentive to buy a car that list for $49,999 vs $50,000 but I have never seen any data on that.
When people list their houses for sale, they usually list for $489,900 instead of $500,000. In real estate, I think there probably is a valid reason to stay below certain threshold prices, IDK.
Anyway, I disagree that raising the iFly GPS price from $69.99 to $70.00 is desirable for customers. It might actually be desirable for AP if they only lose one customer for every 7000 they keep. They will increase revenue by $70.00 minus $69.99 for the lost customer and make an extra PENNY.
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Joined: 1/1/0001
Posts: 0
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I'll just add this...my wife and I use credit cards for almost everything except a few fixed price items that are on bank draft. We give ourselves $20.00 cash per month allowance and I still have $33.00 in my wallet, $20 from January and $13.00 from December. With everything on credit cards, it makes absolutely no difference. The only reason it would is if I was doing all my accounting and book keeping by hand and I didn't own a calculator. Actually, I have multiple spread sheets, one back to 1988 and one back to 1984.
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Joined: 4/1/2012
Posts: 269
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I think we've exhausted this topic... and drifted off iFly anyway.
Can leave it as pretty much agree to disagree..... if YOU'RE not offended in any way and see no subtle insult to your intelligence from it that is an _indisputable_ fact... that no amount of opinion or supposed evidence about merchant's pricing strategies or analysis I or Don might present will, can, change that fact. Nor is there a hellofalot in it for either of us if I tried to.
It's ALSO an indisputable fact that I, Don, and a minority of other shoppers DO take $69.99 and $19,995 pricing as a subtle, possibly unintended, insult to our intelligence, and annoying.....and on the very rare occasions when we have choice between two otherwise substantially identical purchase options we'd DO for the ones pricing at $70 and $20,000.
But FWIW regarding your sentence.....
"When people list their houses for sale, they usually list for $489,900 instead of $500,000. In real estate, I think there probably is a valid reason to stay below certain threshold prices,...":
I agree there IS a real world incentive in that scenario (or when putting an aircraft on Barnstormers at $49,500), although possible not the incentive you were thinking of:
When buyers do a search they might set their search parameters to search of homes priced $400,000 to $500,000.
And we don't know if the system is programmed to take that as "up TO but not including $500,000.
So if I put my home up at $500,000 that searcher just might miss seeing my listing by a dollar and would have seen it if I listed at just below.
That said, when I sold a home in 2005, I listed it on the MLS for $500,000 after very carefully assessing the market, and had an almost full price offer 4 hours after it went live. Same as if I'd put it at $489,00 but left me $11,000 I could discount the seller to close the sale.
We can agree to disagree about our personal preferences. :-)
Fly safe.
Alex
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Joined: 1/1/0001
Posts: 0
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Your real estate example is, for the most part, what I was referring to. You don't want to price yourself out of the market by $1.00. Also, if you list for $500,000, your house might be the crappiest house a buyer would look at compared to the $599,999 houses. We'll agree to disagree. I'll send you my PayPal address so you can deposit all your unwanted loose change left from almost EVERY financial transaction you make. I'll ask AP to bill you $70.00 and bill me $69.98. Thanks for the change.
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I'm just over here eatin' popcorn.
Jeff Nokomis Clark,
Mooney M20G,
iFly app on ASUS ZenPad Z8s,
ASUS ZenFone AR,
ASUS Windows 10 tablet,
Stratux ADS-B w AHRS
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