Buffl

03_Pricing and Branding

pz
by p Z.

Choice Overload


  1. What is the choice overload hypothesis?

  2. What are the effects of choice overload on consumption?

  3. What did the Iyengar and Lepper (2000) study show?

  4. How was choice overload examined in the meta-analysis?

  5. What moderators influence choice overload?


  1. What is the choice overload hypothesis?

  • The hypothesis states that having too many choices can lead to decision difficulties.

  • This often results in lower satisfaction with the chosen option due to the overwhelming number of alternatives.

  • Example: Difficulty choosing a flavor when offered 24 different jams.


  1. What are the effects of choice overload on consumption?

  • Choice overload can lead to less consumption as people struggle to make decisions.

  • Example: Fewer purchases when consumers are presented with 24 jam options compared to 6.


  1. The study found that larger assortments led to lower purchase likelihood.

    1. Consumers were more satisfied with fewer choices, suggesting that too much choice can be demotivating.

    2. Example: 30% purchase rate with 6 jams vs. 3% with 24 jam


  1. How was choice overload examined in the meta-analysis?

    • The meta-analysis compared studies on large versus small assortments.

    • Results were mixed, indicating that the impact of choice overload varies across different contexts and conditions.

    • Example: Some studies showed less choice leads to more satisfaction, while others did not.

    • But Food: More Variet y = More Consumption

  2. What moderators influence choice overload?

    • Cognitive processes, individual differences, and the number and type of available options all influence the effects of choice overload.

    • Example: More options can be overwhelming for individuals with higher cognitive load.






Placebo Effects


  1. What is the placebo effect in marketing?

  2. What role does price play in the placebo effect?

  3. What did the Waber, Shiv, Carmon, and Ariely (2008) study show?

  4. How does the placebo effect influence product performance?

  5. What are the implications of the placebo effect for brands?


  1. What is the placebo effect in marketing?

    • The placebo effect in marketing refers to the perception that higher-priced products are of higher quality.

    • Belief in the product's effectiveness can enhance its perceived performance, independent of its actual properties.

    • Example: Expensive wine tastes better than cheaper wine.

  2. What role does price play in the placebo effect?

    • Price plays a significant role, as expensive products are often perceived as more effective.

    • Example: High-priced energy drinks perceived to improve performance more than cheaper ones.

  3. What did the Waber, Shiv, Carmon, and Ariely (2008) study show?

    • The study found that higher prices lead to better perceived results.

    • Example: More puzzles solved when an energy drink was priced higher.

  4. How does the placebo effect influence product performance?

    • Perceived quality increases with price.

    • Actual performance is influenced by expectations.

    • Example: People report feeling more energetic after consuming a higher-priced energy drink.

  5. What are the implications of the placebo effect for brands?

    • Brands can charge higher prices, as consumers believe in higher quality.

    • Example: Red Bull's premium pricing leads to perceived higher effectiveness compared to cheaper alternatives.



Author

p Z.

Information

Last changed