Consumer Behavior SIG Archives /ama_cohort/cbsig/ The Essential Community for Marketers Thu, 28 Aug 2025 19:02:27 +0000 en-US hourly 1 https://wordpress.org/?v=6.9.4 /wp-content/uploads/2019/04/cropped-android-chrome-256x256.png?fit=32%2C32 Consumer Behavior SIG Archives /ama_cohort/cbsig/ 32 32 158097978 Research Insight | Driving Mobile App Engagement Through Gamification /research-insights/driving-mobile-app-engagement-through-gamification/ Thu, 14 Aug 2025 23:12:56 +0000 /?post_type=ama_research_insight&p=203247 Advertisement

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Cardio with Mr. Treadmill: How Anthropomorphism Increases Motivation /2025/06/17/cardio-with-mr-treadmill-how-anthropomorphism-increases-motivation/ Tue, 17 Jun 2025 16:07:42 +0000 /?p=197690 This Journal of Marketing study shows that anthropomorphizing workout tools—giving them human-like qualities—boosts motivation and makes fitness goals more enjoyable and achievable.

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A recent New York Times article reported : three-quarters of U.S. adults are now overweight or obese, highlighting a crisis linked to declining physical activity. Similarly, the World Health Organization reports that over 80% of adolescents and 27% of adults globally fail to meet recommended activity levels. As modern lifestyles grow increasingly sedentary, finding ways to motivate people to stay active is critical.

A reveals a surprising solution: anthropomorphizing workout equipment—assigning human-like qualities to objects—can significantly boost exercise motivation. By fostering a sense of companionship, anthropomorphism turns solitary workouts into collaborative experiences. Our research team explores this phenomenon through eight experiments in which participants engaged with either anthropomorphized or standard fitness tools.

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Key Findings: How Anthropomorphism Boosts Motivation

  • Increased Exercise Plans: Participants who anthropomorphize their workout tools plan more ambitious routines and exercise with greater intensity.
  • Companionship Effect: Imagining fitness tools as teammates makes workouts feel less daunting and more enjoyable.
  • Enhanced Engagement Beyond Fitness: The motivational benefits extend to educational tools, making learning more engaging.

How It Works: Anthropomorphism in Practice

In one experiment, participants were introduced to a jump rope described as, “Hello! I am your workout partner,” while a control group received the standard description, “This is your workout tool.” Another experiment encouraged participants to imagine their treadmill as a person and describe its personality, creating a “workout buddy” effect.

When participants anthropomorphized their equipment, they reported feeling less alone during their exercise sessions. The imagined relationship between the individual and the equipment transformed a solitary task into an engaging interaction, much like working out with a friend. In the treadmill study, for instance, participants who imagined the treadmill’s personality not only exercised longer but also pushed themselves harder. These feelings of support and partnership reduced the mental barriers to starting or continuing exercise.

Interestingly, participants also described their anthropomorphized tools as being “cheerleaders” or “encouraging friends” rather than just objects. This framing boosted confidence and increased expectations of success, further reinforcing motivation. By cultivating a sense of collaboration, anthropomorphism redefines the exercise experience, making it less about effort and more about teamwork.

Practical Insights for Marketers

Marketers and product designers can leverage these findings to enhance user engagement. Here’s how:

  • Human-Like Features: Fitness tools and apps can integrate friendly interfaces, supportive messages, or avatars to foster a sense of partnership.
  • Collaborative Messaging: Marketing campaigns should emphasize teamwork, using phrases like, “Let’s tackle this together!” to build user trust and motivation.
  • Targeting Diverse Audiences: Understanding the demographic most likely to benefit from anthropomorphic tools—such as beginners or individuals lacking external support—can refine marketing strategies.

Limitations of Anthropomorphism

While anthropomorphism can be effective, its impact is situational and has boundaries:

  • Presence of Real Companions: The motivational boost is less significant when a human workout partner is present.
  • Inherently Fun Tools: Equipment already perceived as enjoyable (e.g., dance-based workouts) receives less added benefit from anthropomorphic features.
  • Controlling Framing: Tools framed as strict “coaches” or “supervisors” can reduce autonomy and diminish enjoyment.

Implications for Public Health

Anthropomorphism’s potential extends beyond fitness, offering applications in education and other self-improvement contexts. By humanizing tools, public health campaigns can create engaging experiences that drive behavioral change.

For instance, educational apps can incorporate friendly, human-like study aids to make learning less intimidating and more enjoyable. Similarly, fitness campaigns targeting inactive populations can emphasize collaboration with anthropomorphic tools to bridge the gap between intention and action.

Broader Applications and Lessons for Practitioners

Consumers should seek out workout tools or apps with well-designed anthropomorphic features to sustain motivation and build long-term commitment. For businesses, investing in anthropomorphic design is a strategic move that enhances consumer well-being and fosters brand loyalty and repeat use.

As physical inactivity and sedentary lifestyles rise globally, stakeholders in public health, marketing, and product design should integrate anthropomorphic elements into their offerings. By doing so, they can help reframe traditionally burdensome tasks as collaborative, enjoyable experiences. Whether tackling fitness or education, the right “partner” can make all the difference.

Read the Full Study for Complete Details

Source: Lili Wang and Maferima TourĂ©-Tillery, “,”  Journal of Marketing.

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Healthy But Wasted: How Consumer Misconceptions ÂÜŔňÉçąŮÍřt Expiration Dates Increase Food Waste and Eat Into Profit Margins /2025/05/07/healthy-but-wasted-how-consumer-misconceptions-about-expiration-dates-increase-food-waste-and-eat-into-profit-margins/ Wed, 07 May 2025 17:57:12 +0000 /?p=194294 A Journal of Marketing study shows consumers perceive healthy foods as “fresher,” leading to the belief that they spoil faster. This causes both unnecessary food waste and lost profits.

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The fight against food waste has gained global momentum, with policies like California’s ban on “sell by” dates aiming to reduce unnecessary disposal. A finds that consumer perceptions about food healthiness play a surprisingly critical role in waste decisions. We discover that healthy foods are more likely to be discarded when nearing their expiration dates because consumers perceive them as more perishable—even when actual freshness is the same.

This misperception has wide-reaching consequences. Consumers demand steeper discounts for healthy foods close to expiration, are less likely to consume them, and ultimately waste them more often than less healthy options. These biases not only undermine sustainability efforts but also create challenges for retailers striving to balance inventory management and profit margins.

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Misconceptions ÂÜŔňÉçąŮÍřt “Freshness”

Our research reveals a fundamental disconnect in how consumers evaluate healthy and unhealthy foods. Healthy items are often perceived as “fresher,” which ironically leads to the belief that they spoil faster. This misconception influences decisions across the food value chain—from purchase to consumption to disposal. For example, consumers are less likely to eat a salad nearing its expiration date compared to a similarly aged bag of chips, believing the former to be riskier to their health.

Retailers face the ripple effects of these biases. Healthy foods nearing expiration often require deeper price cuts to incentivize purchase. This impacts profit margins and creates logistical challenges in maintaining stock levels.

Key Insights

  • Consumers Demand Larger Discounts for Healthy Foods Nearing Expiry
    Healthy items close to their expiration dates are often perceived as riskier to consume, causing consumers to demand steeper price reductions compared to unhealthy alternatives.
  • Healthy Foods Are Wasted More Frequently
    The belief that healthy foods spoil faster means consumers are more likely to discard these items before their expiration dates, leading to higher levels of waste.
  • Bias in Leftover Decisions
    When presented with leftover foods, consumers are less inclined to eat healthy options and are quicker to dispose of them compared to less healthy choices, believing the former to be less safe.

Implications for Marketers and Policymakers

For marketers and retailers, these findings offer actionable insights. Addressing these misperceptions through better labeling and communication can help shift consumer behavior. For instance, emphasizing the durability and stability of healthy foods could mitigate concerns about spoilage. Campaigns that educate consumers about the true perishability of items—highlighting facts like the longevity of certain produce or the minimal risks of consuming healthy foods slightly past their expiration dates—can also play a crucial role.

In addition, current regulations often emphasize the removal of ambiguous date labels but overlook the underlying biases that drive consumer behavior. Policymakers can complement these efforts by promoting educational initiatives that challenge misconceptions about healthy food spoilage. Encouraging transparency in food labeling and creating consistent messaging around expiration dates can reduce waste across households and retail environments.

We also observe opportunities for innovation. Retailers could experiment with dynamic pricing models tailored to healthy foods nearing expiration, offering targeted discounts that maintain profitability while encouraging consumption. Additionally, grocery stores could partner with brands to develop packaging that reassures consumers about the freshness of healthy items, even as they approach their expiration dates.

  • Clearer Labeling: Retailers can introduce packaging that emphasizes the durability and stability of healthy foods, correcting the belief that they spoil faster.
  • Consumer Education Campaigns: Policymakers and industry leaders can develop initiatives that educate consumers about the true perishability of healthy foods, particularly those that appear fresher but have similar shelf lives to less healthy items.
  • Dynamic Pricing Models: Retailers might adopt targeted discount strategies that account for perceived risks while maintaining profitability.

Beyond waste reduction, these strategies align with broader goals of promoting healthy eating and sustainability. By making consumers feel more confident about purchasing and consuming healthy foods close to expiry, marketers and policymakers can drive both health and environmental benefits.

Read the Full Study for Complete Details

Source: Christine Kim, Young Eun Huh, and Brent McFerran, “,” Journal of Marketing.

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More Vivid=More Effective? How Saturated Colors Impact Consumer Behavior—And Waste /2025/04/08/more-vividmore-effective-how-saturated-colors-impact-consumer-behavior-and-waste/ Tue, 08 Apr 2025 16:32:36 +0000 /?p=192178 A Journal of Marketing study finds that products with saturated colors—vivid reds, deep blues, and vibrant greens—are perceived as more effective. Though they grab consumers' attention, these colors can have unintended consequences on consumer health and sustainability efforts.

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For marketers, bold colors can be a strategic tool for grabbing attention on crowded shelves. But vibrant colors can have unintended consequences, causing consumers waste more, save less, or even risk their health. A uncovers a surprising link between what consumers see and the decisions they make, showing how something as simple as color choice can have far-reaching consequences for the environment, consumer health, and sustainability efforts. The study finds that products with highly saturated colors—vivid reds, deep blues, and vibrant greens—are consistently perceived as more potent and effective. This visual cue shapes consumer behavior in significant ways, often influencing how much of a product is used—or wasted.

Across several experiments and studies, the researchers find that consumers overestimate the effectiveness of products based on color saturation—the richness, strength, or purity of a color—leading them to believe products with such colors are more potent. Consumers then use this perception of potency to infer how effective a product will be. This means that a more vivid and intense color can make a product seem more effective, even if the color has nothing to do with how well the product actually works. People make these inferences based on the color of both the product itself and its packaging. In addition, color saturation influences perceptions of product efficacy in advertising.

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A more vivid and intense color can make a product seem more effective, even if the color has nothing to do with how well the product actually works.

For example, in one study, the researchers showed participants images of laundry detergent bottles. Some bottles had packaging with highly saturated colors, while others had less saturated colors. People were more likely to buy the detergent with the more saturated packaging because they believed it to be more effective. Researchers found similar results when showing people work gloves with varying levels of color saturation, suggesting that the link between color saturation and perceived efficacy extends beyond consumable products to durable goods.

Product Color Affects The Amount Consumers Use

Color also affects how much of a product people use. When the researchers placed hand sanitizer dispensers with varying color saturation in university lecture halls, people used significantly less of a highly saturated sanitizer than a less saturated option. In another study, students used less of a highly saturated cleaner to clean their desks. Although this might seem beneficial for promoting sustainable practices, it could be problematic for products where underuse is harmful.

At the same time, the relationship between color saturation and perceived efficacy is not always straightforward. It can be influenced by other factors, such as a consumer’s purchase goal. For instance, if a consumer is looking for a gentle facial cleanser, they might actually perceive a less saturated product to be more effective. This is because they associate lower saturation with gentleness, which is their desired benefit in this case. Conversely, a consumer searching for a strong facial cleanser would likely find the highly saturated product to be more appealing.

The Potential for Misuse or Underuse

The perception of increased potency can lead to unintended consequences. For example, consumers might underdose a brightly colored disinfectant, assuming a smaller amount will suffice. Similarly, medicines with bold packaging may be viewed as overly strong, causing hesitation or improper use.

So while bold colors can enhance product appeal, the fact that consumers make split-second judgements based on color can cause them to be misled when it comes to how the product should be used, which is particularly concerning for items like medications or sanitizers.

Implications for Marketers, Designers, and Policymakers

The findings highlight a tradeoff for marketers. Bold packaging colors can effectively communicate efficacy and capture consumer attention, but they must be used responsibly to avoid unintended consequences. Designing packaging isn’t just about aesthetics—it’s about functionality and trust. Marketers need to ensure that visual elements align with the intended use of the product, especially in categories where accuracy and safety are critical.

The study emphasizes the importance of carefully considering color saturation when designing products, packaging, and advertising:

  • If you want to promote product efficacy, consider using highly saturated colors.
  • If you want to encourage sustainable consumption, use highly saturated colors for products that tend to be overused.
  • However, avoid highly saturated colors for products where underuse could be harmful. In these cases, marketers might consider providing additional information about the product’s potency to offset potential biases. For example, a label could read, “same powerful formula without added dyes.”

Design choices like color saturation can play a key role in promoting resource conservation. Governments and organizations are urging people to conserve resources, reduce waste, and adopt healthier habits. This research suggests marketers, regulators, and consumers can rethink product packaging to promote more sustainable and responsible behavior.

The findings may also be used to help address public health campaigns, ensuring consumers use sufficient amounts of medicines or disinfectants where needed. The underuse of important products like disinfectants or medications because of misleading color perceptions could exacerbate issues during health crises or flu seasons, making this a public health issue. Color psychology can be leveraged to encourage people to use just the right amounts of products to cut down on environmental waste without sacrificing efficacy.

In sum, marketers should align visual design with consumer expectations and product functionality. In a world where packaging often serves as a primary touchpoint for consumers, getting the balance right is crucial.

Read the Full Study for Complete Details

Source: Lauren I. Labrecque, Stefanie Sohn, Barbara Seegebarth, and Christy Ashley, “,” Journal of Marketing.

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Why Low-Income Consumers Avoid Healthy Foods—and How to Change Their Minds /2025/03/11/why-low-income-consumers-avoid-healthy-foods-and-how-to-change-their-minds/ Tue, 11 Mar 2025 10:00:00 +0000 /?p=188485 A Journal of Marketing study shows that low-income consumers' unhealthy food choices aren't just about access or cost—they're about perception.

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In recent years, governments and organizations have introduced policies to combat nutritional inequality, such as increasing the availability of affordable, healthy foods and taxing unhealthy options. Despite these efforts, a finds that such initiatives often fail to significantly change dietary habits among low-socioeconomic status (SES) consumers.

Our research team explores why these interventions fall short and discover that the issue isn’t just about access or cost—it’s about perception. Low-SES consumers prioritize different attributes in their food choices, such as fillingness and taste, over healthiness. These preferences and perceptions are shaped by their socioeconomic realities, creating unique obstacles to adopting healthier diets.

Fillingness, Taste, and Healthiness

  • The Role of Food Attributes in Choices

    Our study highlights three key attributes—fillingness, taste, and healthiness—that shape food choices. While all consumers value taste, low-SES individuals place a much greater emphasis on fillingness, often at the expense of healthiness. In contrast, high-SES consumers prioritize healthiness, reflecting their access to more abundant and diverse food options.

  • Perceived Relationships Between Attributes

    Low-SES consumers often associate healthy foods with being less filling and less tasty, reinforcing their preference for high-calorie, less nutritious options. These beliefs stem from limited exposure to healthy foods and fewer opportunities to experiment with cooking. High-SES individuals, who face fewer resource constraints, are less likely to hold these negative associations.

  • Fillingness as a Critical Factor

    Fillingness, while often overlooked in public health strategies, is crucial for low-SES consumers. For individuals facing food insecurity or limited resources, satiety is a pressing concern. Policies and campaigns that ignore this dimension risk promoting foods that low-SES consumers perceive as unappealing or insufficient.

Implications for Policymakers

Our findings suggest that addressing nutritional inequality requires more than just making healthy foods affordable and accessible. Policymakers should focus on creating and promoting healthy options that are perceived as both filling and tasty.

  • Expand the Availability of Filling Healthy Foods: Increase access to options like whole grains, legumes, and lean proteins, which are both nutritious and satiating.

  • Incorporate Fillingness in Subsidies: Subsidize filling healthy foods to make them more affordable and attractive to low-SES consumers.

Public health campaigns should also work to reshape perceptions. By emphasizing the satisfying and flavorful aspects of healthy foods, marketers and policymakers can challenge the belief that “healthy equals unsatisfying or bland.”

Marketing and Industry Applications

From a marketing perspective, our research offers actionable strategies to encourage healthier eating habits:

  • Reframe the Narrative: Highlight the filling and tasty qualities of healthy foods through advertising and packaging.

  • Product Development: Design healthy food options that cater to low-SES preferences for satiety and flavor.

  • Retail Strategies: Promote healthy, filling meals in stores, particularly in low-income neighborhoods, to align with consumer priorities.

These approaches borrow from the tactics used to market unhealthy foods but reapply them to encourage better choices.

Nutritional inequality is a complex issue that cannot be solved by supply-side solutions alone. Our research shows that consumer preferences and perceptions—particularly regarding fillingness and taste—play a critical role in shaping dietary habits. Addressing these psychological and cultural factors is essential for making healthy foods more appealing and accessible to low-SES populations.

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For policymakers, marketers, and public health advocates, the path forward lies in promoting the fillingness and flavor of healthy foods, ensuring that they meet the needs and expectations of disadvantaged communities.

Read the Full Study for Complete Details

Source: Bernardo Andretti, Yan Vieites, Larissa Elmor, and Eduardo B. Andrade, “,” Journal of Marketing.

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How Does Air Pollution Affect Consumer Spending? /2025/02/11/how-does-air-pollution-affect-consumer-spending/ Tue, 11 Feb 2025 11:00:00 +0000 /?p=184574 How does air pollution affect consumer behavior? This Journal of Marketing study finds that higher levels of air pollution actually drive consumer spending, especially for pleasure-seeking products.

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Does increased exposure to deteriorating urban air quality affect people’s daily spending and choices? Despite extensive discussions on worsening air quality, little is known about the effects of air pollution on consumer behavior and economic activities.

In a , we find that a higher level of air pollution is associated with greater spending. A quantitative analysis of credit card usage data and experimental evidence further reveals that this correlation is pronounced in hedonic (pleasure-seeking) categories, as products and services in these categories tend to lift the mood of consumers.

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Benefits for Retailers

There are several notable ways retailers can benefit from an increase in consumer spending for hedonic categories. We define managerial implications for this group of stakeholders into two broad categories:

  1. Promotion and advertising, and
  2. Corporate social responsibility and brand image building.

An increase in demand linked to air quality fluctuations presents an opportunity for retailers to develop tailored marketing strategies. Marketers can consider the following examples:

  • As soon as the rise in air pollution is noted from the Air Quality Index (AQI) tracking, retailers can leverage displays or signage catering to hedonic consumption and comfort. In-store events, such as a hobby workshop or a wellness product demonstration, can be planned in advance and ready to deploy at the opportune time.
  • Retailers can adjust store ambiance (e.g., music and in-store decorations) to serve current customer preferences more proactively.
  • Retailers can prepare point-of-sale promotions during periods of high air pollution. These may include instant markdowns, special offers on mood-lifting items, or bundles that include hedonic items of increased demand.
  • Retailers may also want to provide sales promotions to counteract an anticipated shrinkage in spending the day following higher air pollution (to correct for overspending) or from big spenders (who are less likely to spend after exposure to pollution).

Ideas for Chief Marketing Officers

Given the ambient nature of air quality, marketing strategies leveraging our results should be capable of quick and effective deployment over a short planning horizon. Chief marketing officers can consider implementing the following ideas:

  • Employ digital marketing tactics such as online ads, social media, or customized content. These may include:
    • i) localized display or search ads for products offering enjoyment and comfort, such as gourmet snacks, entertainment gadgets, wellness products, or feel-good promotions on social media, and
    • ii) customized content, such as timely emails advertising leisure activities.
  • Improve corporate social responsibility and brand image. For example, a company may want to launch a campaign that emphasizes the importance of self-care to address the effect of air pollution on individual well-being. They may partner with healthcare and wellness experts to generate content and resources that help consumers navigate stress and health concerns related to air quality. This campaign can tie into the idea that indulging in hedonic products responsibly is part of self-care during significant air quality drops.
  • Develop a line of hedonic goods and services that are environmentally sustainable, including organic luxury comfort foods or ecofriendly leisure activities. This initiative aligns with the increased demand for such items during periods of high air pollution and reinforces the company’s commitment to sustainability.

Implications for Policymakers

This research is also valuable to policymakers for designing environmental and socioeconomic regulations.

  • First, our main findings of increased spending due to deteriorating air quality raise public awareness about a major environmental crisis and its consequences for daily life, making the issue more relevant and urgent. Accordingly, policymaking institutions can develop campaigns that associate air quality with everyday consumer choices and illuminate how environmental health contributes to individual well-being and economic stability.
  • Second, increased spending might lead to social costs for the general public, such as overconsumption of pleasure-seeking categories. Insights from this research should help consumers be cautious of their continual and habitual consumption of hedonic goods and services during periods of higher air pollution, while policymakers can promote healthier and more environmentally conscious alternatives.
  • Third, our study has implications for household economics in that pollution-induced incidental spending, particularly overspending, may result in the accumulation of revolving debt.
  • Finally, our study suggests an opportunity for industry collaboration involving retailers and manufacturers. Joint campaigns could support the development of sustainable practices, providing incentives for consumers to engage in more sustainable consumption (e.g., emphasizing the benefits of sustainable products) and ecofriendly practices (e.g., highlighting the benefits of eco-friendly transportation), hence promoting responsible consumerism.

Overall, we advocate for the execution of marketing strategies with a strong focus on sustainability, aiming to balance business profits with societal values in the face of escalating environmental challenges and practice more responsible marketing for a better world.

Read the Full Study for Complete Details

Source: Sanghwa Kim and Michael Trusov, “,” Journal of Marketing.

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Research Insight | Does Listening to the News vs. Reading It Change What We Remember? /research-insights/how-does-listening-versus-reading-alter-consumers-interpretations-of-news/ Fri, 20 Dec 2024 00:17:12 +0000 /?post_type=ama_research_insight&p=179075 Advertisement

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Does “Repayment-by-Purchase” Help Consumers Pay Down Debt? /2024/08/07/does-repayment-by-purchase-help-consumers-pay-down-debt/ Wed, 07 Aug 2024 15:08:15 +0000 /?p=165405 Banks have introduced "repayment-by-purchase" options that allow credit card holders to make payments toward specific purchases rather than their aggregate debt. But does this actually help consumers?

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Journal of Marketing Research Scholarly Insights are produced in partnership with the – a shared interest network for Marketing PhD students across the world.

Consumers worldwide grapple with the significant challenge of repaying loans, credit card bills, and other expenses. While the act of spending often brings consumers joy or a sense of accomplishment (such as gaining admission to a top-tier university or purchasing a first car), the enjoyment fades over time, giving way to the burden of repayment. Although making incremental payments can somewhat ease the burden, consumers face a dilemma: how to determine the optimal repayment amount without risking accruing unnecessary interest charges and potentially damaging their credit score. Can consumers pay off credit card debt by addressing specific purchases? For example, are consumers more likely to pay off debt if they can choose to repay an airfare? Or a hotel stay? Or even the entire category of travel?

Firms such as Chase, American Express, and Citibank have introduced such “repayment-by-purchase” options that allow consumers to make payments toward specific purchases rather than their aggregate debt. Under repayment-by-purchase, consumers select specific items (e.g., a coffee at Starbucks) or categories of purchases (e.g., restaurants) to repay and make payments specifically directed toward “eliminating” these purchases from their bill.

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In a , researchers collected data including interviews, a field experiment, and five laboratory experiments, revealing that the “repayment-by-purchase” format can increase repayment by more than 20%. These findings have multiple positive implications for consumer welfare and satisfaction with banks.

The “repayment-by-purchase” format can increase repayment by more than 20%.

In contrast, interviews with frontline bank officials reveal skepticism regarding the potential adverse effects of such features on their interest earnings and credit fees.

To learn more about the challenges of balancing consumer welfare and a bank’s profitability, as well as the impact of personalized payment categories on purchase decisions, we got in touch with one of the study’s authors, Grant E. Donnelly. Grant emphasized the potential of repayment-by-purchase to empower consumers while acknowledging the complexity and user experience challenges of implementing this intervention:

Q: Currently, most banks offer repayment-by-purchase over time instead of repayment-by-purchase at once. Would you consider this as a compromise banks have found to incorporate your findings (i.e., purchase-specific repayment opportunities) while protecting their revenue-generating mechanisms (i.e., time = interest)? Also, can you think of a possible way that makes the situation win-win for both?

A: Banks need to balance profit maximization with customer well-being. Repayment-by-purchase is a tool that empowers consumers to manage their debt. Our research with the Commonwealth Bank of Australia showed that this feature can increase both repayments and financial well-being. Customers repay what they bought within the statement period, leading to more repayments for the bank. Consumers feel more in control of their finances, which outweighs the opportunity costs of interest for the bank.

Consumer empowerment is the biggest advantage of this approach. This can attract new customers who value financial control and provide  a unique selling proposition for banks.

Q: In today’s attention economy, practitioners seek a sleek user experience. However, balancing repayment-by-purchase or category increases users’ efforts to pay their statements. What do you think convinces banks to implement your intervention?

A: The intervention increases user keystrokes, but users who opted to log in more often are boosting overall app engagement. We used up to 14 categories developed with the Commonwealth Bank of Australia to make the design sleeker and more digestible. Categories were presented by debt size, from smallest to largest.

The main effort was on the bank’s side, redesigning the app interface for categories or purchases and not for the consumers. This increased engagement and provided a meaningful user experience.

Q: For which credit card customer segment do you think your intervention is most effective? Transactors, Revolvers, or Dormants? And why is that? Also, can you see the intervention bearing any cross- and up-selling potential for other credit products of the bank?

A: Our intervention is most effective for Revolvers and Dormants. Transactors, who pay their bills in full each month, are not influenced by this intervention. Revolvers, who make partial or minimum payments, benefit from the increased engagement and the sense of accomplishment provided by the intervention. Dormants, or those at risk of default, are also positively impacted as the intervention encourages them to engage and make small payments, improving their financial well-being. Younger customers showed more engagement than the older ones.

Regarding cross- and up-selling potential, consumer banks in the U.S. offer payment plans for smaller purchases, leveraging the sense of accomplishment and empowerment (i.e., choosing tickets ranging from $50–$1000s to pay off over time). This can retain consumers as Revolvers without impacting their credit scores negatively.

Q: Although you have used both “category”-based approaches and “item”-based approaches for your studies, from a consumer perspective, what approach do you think makes decoupling easiest? How many partitioned entities (i.e., labels, items) have you seen as the most effective? What role do you think the diagnosticity of category labels plays?

A: Imagine working an hourly paid job. If you wanted a certain t-shirt, you could frame the goal as “working an extra shift” and therefore couple the purchase with the expense on your statement item.

If the label of the product or category makes the purchase salient to some extent, the decoupling will work equally well. For example, in our paper, we show that the effect does not work well if we show one purchase by a transaction ID. Effective decoupling requires making the purchase salient through meaningful labels. Too many categories can lead to decision paralysis. We’ve found that around 14 categories work well, providing sufficient granularity without overwhelming the consumer.

Q: Repayment-by-purchase demonstrates that an original decoupled procedure yields positive outcomes through recoupling. Are there any other contexts outside financial services in which recoupling affects consumer behavior?

A: Recoupling has also been shown to be a powerful intervention in other contexts. In physical exercise, for example, coupling exercises with weight loss equivalents has a positive impact on exercise behavior. Also, charitable donation behavior is affected by demonstrating the impact of the donations. In the sustainability realm, researchers have shown that coupling recycling outcomes (i.e., future products) with the touchpoint of either recycling or trashing an item positively impacts recycling intentions.

Q: The Bank of Australia implemented your repayment-by-category intervention for six months. What were the successes of this project at the Bank of Australia? What were the challenges faced by the practitioners during implementation? What do practitioners need to be cautious of?

A: In general, banks underlie rigorous regulations. For this intervention, we were lucky to work with a bank that focuses on innovation and sustainability with the consequence of operating a behavioral unit in-house. This unit is responsible for experimenting to enhance consumer welfare and generate knowledge for the bank. Taken together, this commitment made the implementation of the repayment-by-purchase and expensive adjustments of the app interface smoother.

Successes:

  • The intervention improved consumer welfare and increased repayment rates.
  • The Bank of Australia’s behavioral unit facilitated smooth implementation by focusing on innovation and sustainability.
  • The commitment to enhance consumer welfare made the app interface adjustments more manageable.

Challenges:

  • Banks operate under rigorous regulations, requiring careful compliance.
  • Implementing the intervention involved significant changes in the  app interface, demanding resources and coordination.

Practitioners should be cautious of:

  • Regulatory requirements that could complicate implementation.
  • Ensuring sufficient resources and coordination for app interface adjustments.
  • Balancing innovation with regulatory compliance to achieve successful outcomes.

Read the Full Study for Complete Details

Source: Grant E. Donnelly, Cait Lamberton, Stephen Bush, ZoĂ« Chance, and Michael I. Norton (2023), “,” Journal of Marketing Research, 61 (3), 411–29. doi:

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Enjoy Your Work? Make It Known! Buyers Are Willing to Pay More for Products You Enjoy Producing /2024/07/30/enjoy-your-work-make-it-known-buyers-are-willing-to-pay-more-for-products-you-enjoy-producing/ Tue, 30 Jul 2024 13:40:17 +0000 /?p=164510 A Journal of Marketing study finds that buyers are willing to pay more for products or services that the seller enjoys producing.

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Peer-to-peer marketplaces like Etsy, Fiverr, and UpWork are some of the fastest growing businesses in the world. These vertically integrated markets where a single actor is responsible for both creating and selling the item are projected to be worth $355 billion by 2025, according to a study by PricewaterhouseCoopers.

Compared to more traditional marketplaces, long-established signals of quality such as brand name are less relevant in the peer-to-peer space. Instead, sellers in these marketplaces directly tell potential buyers about themselves and the production processes behind their goods and services.

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What should these sellers say in their bios and product descriptions? In a , we find that one of the best things they can mention is that they enjoy their work.

We suspect that many people who choose to sell things through peer-to-peer marketplaces enjoy making their products, yet sellers rarely mention this. For example, in the profiles of 30,000 sellers across various peer-to-peer marketplaces, only about 1% of sellers mentioned production enjoyment. Over 15 experiments, we find consistent evidence that buyers are more interested in, are more likely to choose, and are willing to pay more for products or services that the seller enjoys producing.

We find consistent evidence that buyers are more interested in, are more likely to choose, and are willing to pay more for products or services that the seller enjoys producing.

We also explore how production enjoyment influences the sellers’ decision to price products and services. Ironically, sellers are willing to accept a lower price—and do indeed charge less—for the products and services they enjoy producing. Although sellers also generally associate production enjoyment with higher quality, they do not rely on this inference in their pricing decisions.

In a field study, we test two ads on Facebook for a search engine optimization (SEO) specialist, one that mentioned production enjoyment (“I really enjoy SEO”) and one that was otherwise identical but did not contain these words. We find that small business owners were more likely to click on the ad that mentioned production enjoyment. The positive reactions that buyers have to sellers’ signals of production enjoyment occur over a broad range of jobs. Across our studies, we examine over 100 different jobs and, in all cases, signaling enjoyment increases buyers’ willingness to pay.

Enjoyment vs. Quality

We find that this positive impact occurs because buyers interpret production enjoyment as a signal of a high-quality product or service. After all, someone who really enjoys making jewelry or loves painting probably spends more time and focus on it than others. When buyers learn of this enjoyment, they then presume the product/service is of high quality and are therefore more likely to buy it.

Notably, signaling production enjoyment works best when the production process requires a lot of skill. Automation has made many production processes much easier. In situations where buyers assume the production process is largely automated (or assume the offering does not require much skill overall), production enjoyment does not impact buyers nearly as much.

But even in high-skill contexts, why do sellers charge less for products and services they enjoy producing? Like buyers, sellers also associate production enjoyment with high quality products and services, which should increase prices. We think sellers instead charge lower prices because the joy that they experience during the production process already compensates them for their work. In any case, it seems that production enjoyment carries signals for sellers that lead to different pricing decisions.

Taken together, these findings are somewhat contradictory: sellers charge less money for products and services they enjoy producing, even though buyers are willing to pay more for them.

Lessons for Sellers

  • When sellers mention production enjoyment in their profiles and marketing, buyers are more interested in their products and services.
  • By comparing production enjoyment to a variety of other established cues of product quality (e.g., production effort) and identifying several moderators that determine the impact of this signal (e.g., required skill), we give sellers a useful framework for when and how to signal production enjoyment.
  • Sellers should reconsider their willingness to charge for different products/services. This knowledge can also benefit buyers, who can recognize production enjoyment as a signal of a potential discount, because sellers charge less when they enjoy the production process.

    Overall, if you enjoy the work you do, make sure you tell people! They will think you do better work and should be willing to pay you more for it.

Read the Full Study for Complete Details

Source: Anna Paley, Robert W. Smith, Jacob D. Teeny, and Daniel M. Zane, “,” Journal of Marketing.

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How Daylight Saving Time Is Bad for Your Health: Consumers Eat Worse and Skip the Gym More After Springing Forward /2024/07/23/how-daylight-saving-time-is-bad-for-your-health-consumers-eat-worse-and-skip-the-gym-more-after-springing-forward/ Tue, 23 Jul 2024 10:02:00 +0000 /?p=163563 This Journal of Marketing study finds that consumers eat more unhealthy foods and skip trips to the gym after springing forward into daylight saving time.

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Changing clocks twice a year is a tradition for most people living in the United States, with the spring transition to daylight saving time raising the ire of many due to the loss of an hour of sleep.

Public policy makers are grappling with the question of whether to abolish the biannual time change and, if so, whether to make standard time or daylight saving time permanent. While sleep scientists call for year-round standard time because it best aligns with humans’ circadian rhythms, many retailers and outdoor industries support permanent daylight saving time, arguing that longer sunlight in the evenings supports their business. It is thus crucial to further illuminate the consequences of the current policy to better inform policy makers, managers, and consumers.

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In a , we explore whether the onset of daylight saving time leads consumers to engage in unhealthy behaviors. Are there contextual and individual moderating factors that might amplify the potential deleterious consequences of switching to daylight saving time?

We examined social media data from X (formerly Twitter) to study consumer responses to the onset of daylight saving time. We find that the number of tweets with keywords related to the disruptive nature of the switch to daylight saving time peaked around 12 hours after the change occurred. We also find that the volume of negatively toned tweets rose more substantially, indicating a stronger increase in negative sentiment toward the time change. Overall, our preliminary findings suggest that consumers respond negatively to the switch to daylight saving time.

Snack Consumption and Fitness Center Visits

Next, we examine two unique disaggregate level datasets that capture two different consumer behaviors: snack consumption and fitness center visits. The first dataset captures consumers’ real-time snack consumption in their natural environments, while the second dataset tracks the attendance records of customers visiting fitness centers. For understanding consumer behavior following the onset of daylight saving time, we compare consumers’ calorie consumption from packaged snacks and visits to fitness centers across two customer groups: those who are affected by the onset of daylight saving time (the treatment group) and those who are not affected by the onset of daylight saving time (the control group), before and after the onset of daylight saving time.

We find that:

  1. calorie consumption from largely unhealthy snacks increases following the time change and
  2. visits to fitness centers decrease.

The effect on calorie consumption is amplified during the evening hours and for cloudy days. Further, visits to fitness centers are reduced among fitness center members who live farther away and who do not visit the fitness centers regularly. Finally, we also examine the effect of the transition from daylight saving time to standard time (during fall) and find that there is no effect of the fall transition on calories consumed from unhealthy snacks. Our results highlight the role of sleepiness caused by the one-hour setback, which impairs consumers’ self-control and leads to less healthy consumption behavior.

Lessons for Public Policy Makers

Our study indicates that the onset of daylight saving time is an obstacle to consumers’ health goals, suggesting that policy makers should continue trying to end the time changes. Further, from a consumer well-being perspective, public health campaigns promoting healthy eating and exercise might be especially necessary around the time change.

“Our study indicates that the onset of daylight saving time is an obstacle to consumers’ health goals, suggesting that policy makers should continue trying to end the time changes.”

Lessons for Consumers

We suggest that consumers follow self-control strategies such as avoiding stocking up on unhealthy snacks before the time change. Conversely, fitness center members might plan activities close to the center to reduce the effort required to visit it following the time change. Consumers vulnerable to self-control failures might also seek support from peers (e.g., online social networks) and platforms incentivizing healthy behavior (e.g., through gamification).

Novel technologies, such as smart circadian lighting systems, might also help consumers reset their circadian clocks in a less disruptive fashion. Apps originally designed for travelers to reduce jet lag can be used to minimize the effect of the time change.

Lessons for Chief Marketing Officers

Firms involved in health-related industries can use the insights from the study to anticipate demand and to better serve their customers around the onset of daylight saving time. For instance, when daylight saving time starts, fitness centers could offer promotions like free coffee or a competition or event to bring people in and counter their tendency to skip exercising.

Overall, policy makers, consumers, and firms can benefit from our study by anticipating the likelihood with which people will be thrown off course due to the disruption caused by the time change and discussing steps that might be taken by stakeholders to mitigate the negative consequences.

Read the Full Study for Complete Details

Source: Ramkumar Janakiraman, Harsha Kamatham, Sven Feurer, Rishika Rishika, Bhavna Phogaat, and Marina Girju, “,” Journal of Marketing.

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