We have learned one more truth about ourselves: when we think an object is worth more, we enjoy it more. When told a bottle of wine is worth $90, researchers have found our brain tells us it’s more enjoyable than the same bottle of wine priced at $10. As if we don’t already have enough inflation to worry about – $3.10 gallons of gas, $4.00 gallons of milk, and Starbucks coffee costing more – we have to worry about the damage to the pocketbook we’re self-inflicting. Now, it may not mean we’re likely to actually go out and pay more for a bottle of wine – afterall, I’m as big a cheapskate as they come – but we’re more likely to feel better about the Night Train we’ve just bought on sale…marked down from $90 to a paltry lucky $13.
We are conditioned to believe that if something costs more, it must be better. To the point that in this California Institute of Technology and Stanford Business School study, we find that our brains actually change to accommodate this belief, by sending more blood and oxygen to the medial orbitofrontal cortex – the area of the brain associated with reward.
The study itself purports to provide evidence that marketing actions can influence the consumers’ not only expectations of quality, but our actual experience of enjoyment.
In a way, it makes sense and it is something from which marketers have made a living for as long as there have been marketers – if a person believes they’re getting a deal, they’re more likely to spring to buy a product. For instance, consumers as a whole do not understand the varying qualities of jewlery and when we see an advertisement for a sale – “with prices slashed” from/to – we think we’re getting a good deal. What we fail to notice is the caveat at the end/bottom of the advertisement: “original price may not have resulted in actual sales.” We’re told that the item is worth $X, and that the sale price is now some percentage reduced from that value, but we have no real way of knowing if it actually could sell at the “original” price.
This goes one step farther. This study asserts that marketing can actually change our physiological experience of a product, or in the argot of the profession, it can actually change the intrinsic quality of the product. Meaning that, at least with wine, if we’re told that it is an expensive bottle, we enjoy the wine – “enjoy” as operationally defined by brain activity in the pleasure center of the brain – to a greater extent.
That’s some heavy stuff. Watch out for more studies on this – the more we find out, the more likely we are to be paying more for the perception that we’re getting products of quality.
The study entitled “Marketing actions can modulate neural representations of experienced pleasantness” appears in the Proceedings of the National Academy of the Sciences of the United States of America January 14, 2008.
Afterward: I wrote this in March 2008, so I don’t know if any of the links still work, but I figure it was worth reposting. For instance, gas has come down some in the last 10 years…this caused me to remember what it was like leading up to the economic crash. I’ve found a few things from 2008 and am culling through them to see what’s relevant to post.
One thought on “Hang onto your wallet – or lower your expectations”
Love this post. Pricing places such a mind game on us. Another wine example. A bottle’s list price is $19.99 … but is on sale at $9.99 forty weeks a year. In other words, is it really on sale?