What strategy involves using psychological pricing tactics to appeal to consumers?

The strategy involving the use of psychological pricing tactics to appeal to consumers is odd pricing. This approach entails pricing products just below a round number—such as setting a price at $19.99 instead of $20.00. The rationale behind this tactic is rooted in consumer psychology; prices that end in .99 create a perception of better value, making the product seem less expensive and more enticing to potential buyers.

Odd pricing leverages the idea that consumers often focus more on the leftmost digits of a price, leading them to perceive significant savings when products are priced just below a rounded figure. This method can effectively influence purchasing behavior, as consumers are more likely to respond positively to prices that appear lower due to the psychological impact of odd numbers.

When considering other strategies, everyday low pricing emphasizes consistent pricing without discounts, auction pricing revolves around bidding processes, and variable pricing allows prices to change based on demand or other factors, none of which specifically harness the psychological appeal of pricing in the way odd pricing does.