EFFECT OF CHARM PRICING ON CONSUMER PERCEPTIONS AND PURCHASE DECISIONS: A STUDY OF SHOPRITE, ASABA

Abstract

This study investigated the effect of charm pricing on consumer perceptions and purchase decisions,
using ShopRite Asaba as a case study. Charm pricing, a psychological strategy where prices end in
.99 or .95, is widely used in retail to influence consumer behavior. The primary objective was to
explore how this pricing technique affects perceived affordability, perceived product value, and
purchasing decisions among consumers. A structured questionnaire was administered to 200
customers, and data were analyzed using both descriptive and inferential statistical methods,
including regression analysis. The findings reveal that perceived affordability and perceived product
value are the most significant predictors of consumer purchase decisions with a mean score of 4.04
and 3.94 respectively. Consumers tend to interpret prices ending in .99 as more affordable, even
when the actual difference is minimal. This psychological cue creates a perception of better value,
thereby increasing the likelihood of purchase. The study concludes that while consumers may not
consciously recognize charm pricing tactics, these strategies effectively enhance the perceived
affordability and value of products, thus driving sales. Based on these, the study recommended that
retailers like ShopRite, Asaba continue to implement charm pricing, particularly for price-sensitive
and value-driven consumers, and combine it with strategic visual marketing to maximize impact.
Keywords: Charm pricing, consumer perceptions purchase decision