99 cents makes common cents

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By John Pawlak

Back in the late 1800s, some marketing genius discovered that glass wasn’t the only transparent thing made by man. He noticed that the number nine was also transparent, in fact virtually invisible, and hence was born the trailing invisible nines. I’m talking about the ubiquitous nines thrown at us in one of the most nefarious pricing strategies ever conceived.

A gallon of milk costs $2.99.  A roasted chicken costs $5.99. A pound of Vermont apple smoked bacon runs $12.99.  Ah ha, you didn’t even see those nines, did you?

The “save a penny spend a dollar” mentality is not limited to jars of peanut butter or video rentals. Dell’s XPS computer starts at $1,599. You can upgrade to the i7-980X processor for an additional $999. Then you can add a Mini 1010 netbook for the bargain price of $199.

Interested in a 46” HD LCD TV? It’s only $2,999.99. A NordicTrack AudioStrider - $999.99. That 80GB iPod your kid wants? Hey, it’s below $350! Yes ... $349.99.

Walk through grocery and department stores and your retina is saturated with nines. Potato chips - $1.99, tomato sauce - $2.49, Greek yogurt - $3.99, Levi Jeans - $19.99, dog collar - $12.99. If nines could fight disease, the entire world would be cured during a single shopping trip. Nines are ubiquitous (by the way, that’s a great word for those prepping for the SATs).

That marketing guy understood how we think in numbers. $246.30 ... $275.82 ... $291.40 ... $299.99 ... they’re all “two hundred something.” And it’s all those “somethings” that kill your paycheck at the end of the month.

When we buy that DVD recorder for $99.99 we feel good. We know in our hearts that it’s really $100, but somehow, it feels better. It’s less than $100! It must be the left side of our brains arguing with the right side of our brains (in my case, both sides usually lose the argument). And so we’ve endured the ridicule of invisible nines our entire lives. Whether it’s a candy bar for 59 cents or a sweater for $29.99, our eyes somehow manage to avert the nines and we go on living with that slightly better feeling — and a slightly lighter wallet than we might expect.  About nine something lighter.

But the ultimate insult comes at the gas pump.

Gasoline is currently running about $2.79 a gallon. Well actually, $2.79 and 9/10ths of a cent. As if paying $2.79 isn’t punishment enough, someone out there gets their jollies watching us pay that extra 0.9 cents per gallon. I’m still trying to figure out where to invest that 1/10th of a penny savings.

The fact is we’re not saving anything. That innocuous 9/10ths of a cent adds up.  America consumes 380 million gallons of gasoline every day. Adding 0.9 cents to the price adds a hidden $1.3 Billion a year at the pump. Don’t you just hate math?

So who is the real villain in this story? Well, my theory is that it’s all Abe’s fault.  Yeah, I’m talking about the penny. That innocent little copper-looking coin (in 1982, the composition went from 95 percent copper to 97.5 percent zinc) is the culprit to all our suffering! If not for the penny, maybe we wouldn’t have to deal with all those nasty nugatory nettlesome nines.

The U.S. Mint produces billions of pennies each year, to date nearly 300 billion of them. Lined up edge to edge, they would circle the Earth 137 times. The most disturbing fact is that it costs 1.7 cents to manufacture and distribute one penny.  The government loses tens of millions of dollars each year just making these trinkets.

Only the US government could manage to lose money by making money.

Of course, if pennies were to disappear, another marketing genius would quickly discover the power of the invisible nickel. That 46” HD LCD TV’s price would drop from $2,999.99 to $2,999.95.

Worse yet, we would no longer be able to give anyone our two cents. So ... a nickel for your thoughts?