Exploring the role of spotlight effect in pay‐what‐you‐want (PWYW) pricing—An anchoring and adjustment perspective

2021 ◽  
Author(s):  
Rajat Roy ◽  
Piyush Sharma ◽  
Ricky Y. K. Chan ◽  
Vidyasagar Potdar
Keyword(s):  
Anchoring And Adjustment ◽  
Pay What You Want ◽  
Spotlight Effect

How much would you like to pay? Trust, reciprocity and prosocial motivations in El trato

2012 ◽  
Vol 51 (3) ◽  
pp. 389-417 ◽  
Author(s):  
Francisco J León ◽  
José A Noguera ◽  
Jordi Tena-Sánchez
Keyword(s):  
Social Science ◽  
External Validity ◽  
Laboratory Experiments ◽  
Social Science Research ◽  
Science Research ◽  
Trust Game ◽  
Sales Strategy ◽  
Pay What You Want ◽  
Natural Settings

Prosocial motivations and reciprocity are becoming increasingly important in social-science research. While laboratory experiments have challenged the assumption of universal selfishness, the external validity of these results has not been sufficiently tested in natural settings. In this article we examine the role of prosocial motivations and reciprocity in a Pay What You Want (PWYW) sales strategy, in which consumers voluntarily decide how much to pay for a product or service. This article empirically analyses the only PWYW example in Spain to date: the El trato (‘The deal’) campaign launched by the travel company Atrápalo, which offered different holiday packages under PWYW conditions in July 2009. Our analysis shows that, although the majority of the customers did not behave in a purely self-interested manner, they nonetheless did so in a much higher proportion than observed in similar studies. We present different hypotheses about the mechanisms that may explain these findings. Specifically, we highlight the role of two plausible explanations: the framing of the campaign and the attribution of ‘hidden’ preferences to Atrápalo by its customers, which undermined the interpretation of El trato as a trust game.

scholarly journals Using spotlight effect to curb counterfeit consumption – an experimental investigation

2015 ◽  
Vol 33 (4) ◽  
pp. 556-574 ◽  
Author(s):  
Lingjing Zhan ◽  
Piyush Sharma ◽  
Ricky Y. K. Chan
Keyword(s):  
Undergraduate Students ◽  
Experimental Studies ◽  
Social Consequences ◽  
Probability Estimate ◽  
Content Type ◽  
Outcome Severity ◽  
Target User ◽  
Egocentric Bias ◽  
Spotlight Effect

Purpose – The purpose of this paper is to investigate how counterfeit users estimate the probability of being detected and how this probability affects their counterfeit consumption behaviour. Specifically, it addresses three questions: do perceived social consequences influence counterfeit users’ probability estimate of being detected? What is the psychological mechanism underlying the estimation of this probability? And how does this probability estimate affect counterfeit purchase and usage intentions? Design/methodology/approach – The authors used three scenario-based experimental studies with university students in Hong Kong, a place where counterfeit products are widely available. First study used a factitious brand of jeans as the stimulus and the other two studies used a Ralph Lauren polo shirt. In each study, the authors measured participants’ responses towards counterfeit purchase and the probability of being detected after they read the relevant brand information and had a close-up view of the attributes in the genuine and counterfeit versions. Findings – The authors found that counterfeit users are susceptible to a pessimism bias such that they estimate a higher probability of being detected when they judge the outcome of being detected as more severe and this bias is driven by the spotlight effect in that counterfeit users judging the outcome as more severe tend to perceive that others pay more attention to their counterfeit usage. Moreover, this pessimism bias is mitigated when the target user is another person instead of oneself, thus suggesting the egocentric nature of the bias. Research limitations/implications – The authors used undergraduate students and scenario-based experimental approach in all the studies that may limit the generalisability of the findings. Practical implications – The results suggest that brand managers should emphasise the importance of negative social consequences and highlight the role of outcome severity and egocentric bias in their advertising and communication programmes in order to curb counterfeit consumption. Originality/value – The research contributes to the growing literature on counterfeit consumption by studying the process underlying estimation of the probability of being detected by others, an important but often neglected factor that influences counterfeit purchase decision. The authors also highlight the role of outcome severity and egocentric bias in this process.

scholarly journals Digital Goods Are Valued Less Than Physical Goods

2017 ◽  
Vol 44 (6) ◽  
pp. 1343-1357 ◽  
Author(s):  
Ozgun Atasoy ◽  
Carey K Morewedge
Keyword(s):  
Perceived Control ◽  
Purchase Intention ◽  
Psychological Ownership ◽  
Digital Goods ◽  
Mediating Role ◽  
Incentive Compatible ◽  
Psychology And Economics ◽  
Pay What You Want ◽  
The Difference

Abstract Digital goods are, in many cases, substantive innovations relative to their physical counterparts. Yet, in five experiments, people ascribed less value to digital than to physical versions of the same good. Research participants paid more for, were willing to pay more for, and were more likely to purchase physical goods than equivalent digital goods, including souvenir photographs, books (fiction and nonfiction), and films. Participants valued physical goods more than digital goods whether their value was elicited in an incentive compatible pay-what-you-want paradigm, with willingness to pay, or with purchase intention. Greater capacity for physical than digital goods to garner an association with the self (i.e., psychological ownership) underlies the greater value ascribed to physical goods. Differences in psychological ownership for physical and digital goods mediated the difference in their value. Experimentally manipulating antecedents and consequents of psychological ownership (i.e., expected ownership, identity relevance, perceived control) bounded this effect, and moderated the mediating role of psychological ownership. The findings show how features of objects influence their capacity to garner psychological ownership before they are acquired, and provide theoretical and practical insights for the marketing, psychology, and economics of digital and physical goods.

How consumers respond to social norms: an evidence from pay-what-you-want (PWYW) pricing

2019 ◽  
Vol 36 (4) ◽  
pp. 494-505 ◽  
Author(s):  
Preeti Narwal ◽  
Jogendra Kumar Nayak
Keyword(s):  
Social Norms ◽  
Consumer Behaviour ◽  
Critical Role ◽  
Price Fairness ◽  
Content Type ◽  
Consumer Responses ◽  
Norm Compliance ◽  
Perceived Price ◽  
Pay What You Want

PurposeThis paper aims to investigate consumer behaviour in response to social norms under pay-what-you-want (PWYW) pricing. Specifically, it explores the critical role of social norms such as norm priming and consumer prior trust in the retailer on consumers’ perceived price fairness, trust, willingness to pay, purchase intentions and intentions to spread negative word of mouth about the retailer.Design/methodology/approachData on dependent measures were collected through the scenario-based online experimental approach and assessed using MANOVA analysis.FindingsResults confirm the significance of norms by indicating the critical role of norm belief on consumer responses. Also, increasing the salience of norms by priming them usually intensifies negative behaviour, and pre-existing trust in the retailer serves as an imperfect cushion against consumer negative reactions to norm violation, but this effect is observed to be decreasing with increase in prior trust.Research limitations/implicationsFurther research should consider the contextual (time, place, media) influences and assumptions to increase the generalizability of the findings.Originality/valueTo the best of the authors’ knowledge, this is the first paper to explicitly examine the effects of social-norm compliance by sellers on consumer behaviour in the context of PWYW pricing.

The Role of Altruistic and Egoistic Motivations in Pay What you Want Situations

2014 ◽  
pp. 28-31
Author(s):  
Frank Huber ◽  
Michael Lenzen ◽  
Frederik Meyer ◽  
Eva Appelmann
Keyword(s):  
Pay What You Want

Anchoring and Adjustment With Spatial Uncertainty in Trajectory Prediction

2016 ◽  
Vol 60 (1) ◽  
pp. 1605-1609 ◽  
Author(s):  
Nathan Herdener ◽  
Christopher D. Wickens ◽  
Benjamin A. Clegg ◽  
C. A. P. Smith
Keyword(s):  
Spatial Prediction ◽  
Spatial Uncertainty ◽  
Trajectory Prediction ◽  
Anchoring And Adjustment ◽  
Visual Spatial ◽  
Future Behavior ◽  
Spatial Domains ◽  
Future Object ◽  
Uncertainty Information

Anchoring and adjustment is a prevalent heuristic, common in a range of settings and decisions. While it is well studied using values, there has been limited research on its function in visual-spatial domains. The present study explored the role of anchoring and adjustment with visual displays containing uncertainty information related to spatial prediction. Participants were given a graphical briefing to anchor them on accurate, inaccurate, or no information regarding the future behavior of an object (both its average behavior and the variance in behavior). They then made predictions of future object location and estimated its likelihood at multiple locations. Overall individuals utilized the anchoring information and were able to adjust to incorrect anchors. However, individuals vastly overestimated the likelihood the object would be at any given location, suggesting that they were not anchored on the variance.

The Role of Gender in Pay-What-You-Want Contexts

2021 ◽  
pp. 002224372199205
Author(s):  
Shelle Santana ◽  
Vicki G. Morwitz
Keyword(s):  
Gender Differences ◽  
Marketing Communications ◽  
Economic Factors ◽  
Pay What You Want ◽  
Communal Orientation ◽  
Real Payments

This research highlights how gender shapes consumer payments in pay-what-you-want contexts. Four studies involving hypothetical and real payments show that men typically pay less than women in pay-what-you-want settings, due to gender differences in agentic versus communal orientation. Men approach the payment decision with an agentic orientation, and women approach it with a communal orientation. These orientations then shape payment motives and ultimately affect payment behavior. Because agentic men are more self-focused, their payment decisions are motivated by economic factors, resulting in lower payments. Conversely, communal women are more other-focused, and their payment decisions are motivated by both social and economic factors, resulting in higher payments. The findings additionally highlight how sellers can use marketing communications to increase the salience of social payment motives and demonstrate that by doing so, marketers can increase how much men pay without altering how much women pay in pay-what-you-want settings.

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