yeah that works.
As well as increasing prices 30% and hen adding a tag with 25% off

Thats illegal in much of the world (you have to sell it for a certain amount of time at the price to say its discounted)

I find it quite logical actually.
When you see a price like $3.99 you see it as 3 and some more, not 'almost $4'.
You file $3.99 in the $3 category.
So then the difference seems smaller between $2 and $3 (and some more).
I am a bit sleep deprived though, so I can't guarantee any of this makes sense.

Me too , I think it is the way I work mentally generally, I translate the price exactly as you do. That also means that if I have to rember a price like $3.99 I would probably remember and refer to it as around $4 or $4 , but if I have to quote directly like from a site or a folder over the phone to someone else then I think that I will report what it says , like $3.99.


I still can not guarantee that if I go to a sale at the GOG.com site that I am not influenced by that the price says $2.99 instead of $3 , but I can guarantee one thing and that is if I think that the price is too high or the discount too low then I don't "freakin" care if the price has got a _.99 attached to it , I still won't buy - so my brain at least still works fine that way......

My brain actually did not so much focus on the "The Left-Digit Effect" , my brain did another thing :
In the case when the pens were priced at $1.99 and $4.00 , then what I in my brain had as a thought (READ) were that the one at $4.00 were actually sold at more than twice the price than the $1.99 item - which is also TECHNICALLY correct though maybe only by a cent......
And if something is MORE than OR twice the price than another then it is a lot more expensive.....
You may not think or "work" as I do , but that is what went through my mind......

------------------------------------
P.S. , Just found this :
Top Ten Myths About the Brain Science & Nature Smithsonian Magazine

To be perfectly accurate, that perception is actually true. 30 is exactly 75% of 40, while 29.99 is "only" 74.9937...% of 39.99, as you decrease both prices by the same value, the percentage difference between them gets larger.

Thanks for the studies.
The fact that it works though doesn't mean that it should be exploited.
It's not stupid, it just stinks.

Again it's a question of image and message. What is GOG transmitting to it's users using the x.99 ?
that GOG has the cheapest prices ? I don't think that's the case coz in some cases the price for a game is cheaper at Steam or some other service.

What GOG transmits most of all is honesty and trust for the user and that 'trick', even if it works, goes against that spirit.

http://www.happen.com/index.php/home/articles/49-psychology-of-pricing
Article extract :

Conclusion

The above explanations for rounded pricing are all subject to criticism and weaknesses. There does not seem to have been a significant enough shift in the online price comparison mechanism to explain the move away from fractional pricing. Positing that rounded pricing is an attempt to win back consumer trust is also problematic since many retailers offer products priced in both ways - inconsistent. Additionally, consumers still seem to view prices of a fractional nature as better value than those which are rounded - they are perceived to be more closely aligned with the underlying costs: this presents therefore, a motivation for retailers to price fractionally.

I guess this topic has ended without coming to a conclusion.

thanks everyone for your thoughts and idea.

Walmart usually has their prices for games a few cents lower then the other retailers so they can still say they're cheaper (ex $49.88 instead of $49.99) and I thought it was a silly thing but it actually works on some people. My friend use to work at a Gamestop and had multiple people ask her if they would compete with Walmarts price since it was cheaper on the Wii... by cents. I don't know percentage but I do know she told me some of them actually left the store and said they were going to drive to Walmart to pick it up. Yes, they were going to spend more on gas to drive somewhere else to save a few cents, literally. Even though it seems silly to us, other people can't grasp the concept and that's where the prices not ending in .00 actually works.

I would also like to add there were so many times I would quote a price to someone over the phone as (example, of course) $10 on a $9.99 item because like the majority of the posters here, we round up. They would come in and ask for the $10 item and it would ring up $9.99 which is when they would proceed to call me a liar or something to that notion.

I must be one of those this so-called trick doesn't work on. I've always looked at the full price and rounded up, regardless of which currency I'm dealing with.

Taking GOG's pricing as an example, I still use the old "ideal" exchange rate of 100 yen == $1.00. Thus a $5.99 game is equivalent to 600 yen. In reality, with the real exchange rate 77.59 yen to the dollar, that $5.99 game is only actually 465 yen (rounded up).

So, ultimately, I'm doing the opposite to what is expected from that trick and it works for me =)

Still, in actual brick and mortar stores, it's not just tricks with pricing that you have to be aware of, but all the other tricks they use too, such as floor layout and arrangements of product packaging...

They must keep doing it. If shops stopped doing this, people would stop being wise to the trick, then people would start falling for it, so shops would start doing it again. We'd end up with some insane cyclic pricing system. GOG are, as usual, doing this for our own good; they're heroes really.

Incidentally - Vestin, you got you're Roman Numerals 'wrong'. Some bloke somewhere has decreed that we can't use IC or IM, we have to use XCIX for 99.

9.99 is cheaper than 10$!! enough said haha