December 30, 2011 3 Comments
When it’s time to make an important purchase there are ways to ensure you don’t get screwed. You could talk to your friend who’s an industry insider, spend days scanning various websites for good deals, or simply go to the store and attempt to bargain. Nevertheless, in the end the people doing the selling will always be three steps ahead because they’re on top of research like this:
In this paper, we demonstrate that including commas (e.g., $1599 vs. $1599) and cents (e.g., $1599.85 vs. $1599) in a price’s Arabic written form (i.e., how it is perceived visually) can change how the price is encoded and represented verbally in a consumer’s memory. In turn, the verbal encoding of a written price can influence assessments of the numerical magnitude of the price. These effects occur because consumers non-consciously perceive that there is a positive relationship between syllabic length and numerical magnitude.
More specifically, the study found that when a price includes a comma (e.g. $1,426 rather than $1426), people are likely to pronounce it “fourteen-hundred and twenty-six” rather than “fourteen-twenty-six.” Because there are more words, more auditory processing time is needed, and the increased processing time creates the perception that the magnitude of the price is greater. The same effect occurred when cents were added to a price (e.g. $1426.85 was perceived to be of a significantly higher magnitude than $1,426).
Although you can be sure every major retailer is aware of these effects, the nice thing about the study is that its ideas can be applied by almost anybody. Ameliorate your girlfriend’s anger by saying the lamp you broke cost $20 rather than $21.99. Show your friend you’re a bigshot by writing that your new car cost $18,457.89 rather than $18457. You could even fight SOPA by adding commas to public lists that show the number of companies the law will destroy. (Ok, that’s probably not the most-efficient way to fight the bill, but you get the idea. )
Coulter, K., Choi, P., & Monroe, K. (2011). Comma N’ cents in pricing: The effects of auditory representation encoding on price magnitude perceptions Journal of Consumer Psychology DOI: 10.1016/j.jcps.2011.11.005