$1.99 set meals when 1 cent coins no longer exist

From ‘Do away with $1.99 pricing for meals’, 2 June 2012, ST Forum

(Lim Kay Heng): I WONDER why NTUC Foodfare prices its set meal at $1.99 when the Board of Commissioners of Currency has stopped issuing 1 cent coins (‘Budget $1.99 meal to beat inflation’; Friday).

Why not price it at $2? If NTUC Foodfare wants to give the impression that it can offer a meal for the needy at less than $2, price it at $1.95 or $1.90.

The most affordable ‘Mixed Vegetable Rice’ money can buy

For 1 chicken wing braised in dark sauce, hard boiled egg and what looks suspiciously like canned achar,  $1.99 sounds like a good deal, even looks appetising, though probably not filling enough for me. According to the original article,  ‘the $1.99 rate is for customers who are part of the Public Assistance Scheme, students, senior citizens, full-time national servicemen with concessionary cards and NTUC union members. Other diners pay $2.50.’ Those on the PAS can opt to fork out ONE miserly CENT more if they forgo the set and choose from 20 dishes for $2. Therein lies the oldest marketing gimmick in the book, the use of the magical number 99 to attract customers, when it’s unlikely that anyone will ACTUALLY pay $1.99 (unless you spent your entire childhood collecting one cent coins in a jar). As you’ll see, the extinction of ONE cent coins is not the POINT here. This isn’t charity, and like any other business you need some play with numbers to stay afloat. And this number play is as old school as it can get.

What one cent coins looked like

One cent coins have been out of commission since 2002, incidentally a time when Woman Entrepreneur of the Year 2000 Nanz Chong’s ONE.99 shop was considering raising prices of all items to $2. First set up in the Heeren, Orchard Road (circa 1997), ‘$1.99 for everything’ was a shrewd, ballsy gimmick at the time (Everything at $199 – in the heart of pricey Orchard Road? 6 July 1997, ST). That business eventually folded, though many other factors such as copycat competition may have brought the budget concept to its knees other than giving up on a ‘magical’ price tag. I personally wouldn’t buy my kitchenware at a TWO DOLLAR SHOP, though I would patronise a $2.99 store because of the illusion of ‘value’ that the numbers create, even if that doesn’t make any rational dollar sense at all. In 2001, someone opened a $10 dollar clothings shop in Far East Plaza called Take Ten to ride on the $1.99 frenzy (And for $10, 15 Feb 2001, ST). I don’t know if this still exists today but I think more people would bite if it had charged everything for $9.99 instead.

You could apply the 99 numerological sorcery to price tags other than ‘economical’ rice or budget shop items as well.

The list of  freakonomic tricks involving magic number 9 is endless, and since you can jolly well top up 1 cent for better variety, I would think a ‘$1.99 set meal’ is more a calculated gamble on flawed human psychology than anything else.  You feel good about yourself if you in fact do pay $1.99, but even better if you ‘pay a teenie-weenie more’ ($2) for something extra. If the ONE.99  shop and the above examples have taught us anything, it’s that you can always make a hungry person pay more than necessary and still think he had a good bargain.

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One Response

  1. […] Generous donors teach Straits Times a lesson about unconditional giving – Everything Also Complain: $1.99 set meals when 1 cent coins no longer exist – Singapore Investor: Cost of living in the United Kingdom-Food [Thanks Adrian] – The Kent Ridge […]

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