Last night I met someone who is a big believer in the 99-cent price point. This person has had tremendous success with their own books, and feels the price point was a major factor in that success. (Don't worry--once the books started to take off, the person raised the price, thereby sparing me more cerebral trauma.)
Their further evidence in favor of that price point was the fact that they help writers with largish backlists put out e-books, and the 99-cent price point has been very helpful in driving sales for those people as well.
The person was very adamant about the virtues of that price point, which was odd to me, because 1. they were not John Locke, and 2. my experience with the 99-cent price point was much more negative. I had Trang at 99 cents for a fairly long time last year, and I don't think it sold a single copy during those months. And you have people like Elle Lothlorien who saw sales increase every time she raised her book's price. Enough writers have had similar experiences that there's even a whole theory that the 99-cent price point is actually harmful, tainting your work with the odor of off-price sushi.
But then I thought about how I respond to the 99-cent price point when books by an author I am interested in are offered at that price. I jump all over those suckers.
And that's what I think is happening here. The type of writer this person services has a backlist of several books. In other words, these are writers who have already done the work of building a fan base.
In that case, the process presumably goes something like this:
1. Author releases backlist as 99-cent e-books.
2. Author's fans go, "zOMG!! SQUEEE!!! That's a great price!" and BUY BUY BUY.
3. Author's books shoot up Amazon's charts.
4. Amazon's algorithms do the rest.
But I think for somebody new...eh. Then I think you do run the risk of smelling a little fishy. You'd need to get a lot of "this book is good"-type indicators before dropping things to 99 cents is going to move the needle.