For the last 25 years, $20 has been the magic price point for impulse purchases. It seems like it’s the only thing that has remained unaffected by inflation. In fact, statistics show over 25 years the cost of almost everything doubles. Why then has the $20 price point of impulse items remain unchanged?
I was recently visited Susan Wheeler Antiques, located in the booming Georgetown area of Seattle Washington. Wheeler’s shop is a magnificent mix of antiques and ephemera that beckons one to meander through it slowly and thoughtfully. As I walked through her shop, I kept noticing price tags for $28. The more I saw that modest number, the more comfortable I felt with that price point. Maybe it was that in the context of an antique store, $28 seemed like a bargain or perhaps it was the even number integers made it seem accessible. Maybe it was seeing $28 tags repeatedly. Whatever the reason, I felt comfortable with that number and left with the feeling that the time has come to begin pushing the price point envelope away from $20 for impulse purchases. In an environment where every sale is precious, an extra $8 to a sale represents a 40% increase. This is a huge increase to the retailer but an amount that many consumers can comfortably leap to spend.
I can already hear the registers ringing in an extra 40%.
