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Pricing Compression: The Case for Removing the Dollar Sign

pricing compression Jul 05, 2022

Dollar signs scream, ‘Hey! You’re about to spend money!’. In retail, this can feel both aggressive and tacky. 

Take one look at a cannabis menu board or eCommerce site; money symbols are everywhere and send subtle messages to your customers about spending money.

In the world of restaurants, menu engineering is a hot topic to support sales. Dollar signs are one of the fastest and easiest adjustments that guide customers to spend more.

We can look at a few prominent Toronto restaurants like Aloette Restaurant which spent months preparing to unveil new menus.

Customers might have noticed prices without the $ symbol. Prawn Ceviche is listed as “18” as opposed to “$18”.

A study published by Dr. Kimes and other researchers at Cornell University explains that when people are given prices with dollar signs, they spend less on average than when dollar signs are removed.

The study also showed that customers spend substantially more when only numbers are on display (i.e., “14” or “14.00”) versus when dollar signs are introduced.

How does this relate to pricing compression? If industry prices are compressing, we need to analyze and leverage tools to support sustainable selling prices at retail. Customers' perception of cost is a big part of their understanding of price. 

So, how can this help brands and retailers?


  • Review your in-store pricing displays, menu boards, and eCommerce sites
  • Where it might not make sense to remove $, consider making it smaller and lighter in colour than the numerical details 


  • Review your sell sheets for retailers. Inventory buyers and budtenders are receiving the same subtle messages about pricing. 
  • Adjust in-store displays, and provide this insight to retailers about $$ when highlighting the price of your products

By minimizing the impacts of dollar signs and maximizing the effect of pricing signage, you can create a more compelling customer journey - where things like visual merchandising and displays support customer spending.


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