Consumers Will Pay More For Products They Can Touch
Business owners, take note. The more products you allow your customers to see and touch, the more they are going to be willing to pay for them. And it’s all because we’re hard-wired to prefer things that we can touch, new research shows.
A research team at the California Institute of Technology (Calltech) studied how people assign value to consumer goods — and how those values depend on the way the goods are presented. What they wanted to discover is the answer to a question that is the heart of economics and marketing — does the way an item is presented to consumers affect their willingness to pay for it?
Antonio Rangel, professor of neuroscience and economics at Caltech, translated that quest into a real-life example:
“At a restaurant, does it matter whether they simply list the name of the dessert, show a picture of the dessert, or bring the dessert cart around?” he said.
Most behavioral theories assume that the form of presentation shouldn’t matter. The Caltech researchers discovered that in fact it did matter — a lot.
The Caltech team conducted its experiments by presenting foods to hungry subjects in three different ways: in a text-only description, in a high-resolution photograph and in a tray placed in front of the subjects.
“Then we measured their willingness to pay for the food,” Rangel said, by allowing participants to “bid” on how much they were willing to pay.
Text and photos tied; there was no difference in their results. But the bids on the food presented on a tray right in front of a subject were an average of 50 percent higher than bids on either of the other two presentations.
The researchers thought people would bid more in the face of more information or seemingly emotional content. They were surprised to find that the text display and the image display led to similar bids. “This finding could explain why we don’t see more pictorial menus in restaurants — they simply aren’t worth the cost,” said Benjamin Bushong, a Caltech graduate student.
As intriguing as the results of the food experiments were, the researchers didn’t stop there. Could it be that the smell of the food made it more appealing to the experiment’s subjects? To take that variable out of play, the team repeated the experiment with different goods. This time they used a variety of trinkets from the Caltech bookstore.
“Key chains, stickers, pens, hats, mugs,” Rangel told BusinessNewsDaily. “The typical stuff you find at a university store.”
The results were the same as the food experiments. People were willing to pay, on average, 50 percent more for items they could reach out and touch than for those presented in text or picture form.
But why? The team’s hypothesis was that this was an example of a classic Pavlovian response.
“Behavioral neuroscience suggests that when I put something appetizing in front of you, your brain activates motor programs that lead to your making contact with that item and consuming it,” Rangel said.