Forum for Science, Industry and Business

Sponsored by:     3M 
Search our Site:

 

Spillover effect: Why we end up spending more when we think we're saving

10.11.2006
Ever go to a store intending to buy one item, only to leave with a cartful? Or walked out of a store after feeling you had been overcharged for something you needed?

A groundbreaking new paper in the December issue of the Journal of Consumer Research is the first to comprehensively outline "spillover effect" – that is, the tendency for consumers to spend more on a shopping trip when something they were planning to buy is deeply discounted. Similarly, an unanticipated price increase, or a decrease in quality, on a planned purchase causes overall spending to go down.

"Results from two laboratory studies show that spillover effects can occur in response to both positive and negative changes in either the price or quality of a product," write Narayan Janakiraman (University of Arizona), Robert J. Meyer (University of Pennsylvania), and Andrea C. Morales (Arizona State University). "Positive changes increase total spending on other items and negative changes reduce it."

Positive surprises, like a sale on something you were planning to buy anyway, inflated overall purchasing. But both unexpected price increases and decreases in quality caused people to buy fewer discretionary items – and to pass up other goods offered at attractive, discounted prices.

This challenges prior research on the effect that suggests that we mentally budget and react to feelings of diminished or increased wealth by shopping accordingly. Instead, based on their findings, the researchers argue that a more consistent root of "spillover effect" is attribution theory and our desire to reward or punish the retailer for shopping surprises.

Unexpected changes in price trigger feelings of anger or gratitude. In this sense, the researchers point out, consumers are like restaurant patrons who may express gratitude for a complimentary bottle of wine by ordering more, or express anger over a long wait by ordering less.

"Are the feelings rational? In some cases they might well be – such as if consumers have real reason to believe that a decision to withhold purchases might cause the retailer to offer better terms in the future," explain the authors. "But in this research no such expectations existed, [and] yet the instincts to reward or punish prevailed."

Suzanne Wu | alfa
Further information:
http://www.uchicago.edu

More articles from Studies and Analyses:

nachricht Europe’s Demographic Future. Where the Regions Are Heading after a Decade of Crises
10.08.2017 | Berlin-Institut für Bevölkerung und Entwicklung

nachricht Scientists reveal source of human heartbeat in 3-D
07.08.2017 | University of Manchester

All articles from Studies and Analyses >>>

The most recent press releases about innovation >>>

Die letzten 5 Focus-News des innovations-reports im Überblick:

Im Focus: Fizzy soda water could be key to clean manufacture of flat wonder material: Graphene

Whether you call it effervescent, fizzy, or sparkling, carbonated water is making a comeback as a beverage. Aside from quenching thirst, researchers at the University of Illinois at Urbana-Champaign have discovered a new use for these "bubbly" concoctions that will have major impact on the manufacturer of the world's thinnest, flattest, and one most useful materials -- graphene.

As graphene's popularity grows as an advanced "wonder" material, the speed and quality at which it can be manufactured will be paramount. With that in mind,...

Im Focus: Exotic quantum states made from light: Physicists create optical “wells” for a super-photon

Physicists at the University of Bonn have managed to create optical hollows and more complex patterns into which the light of a Bose-Einstein condensate flows. The creation of such highly low-loss structures for light is a prerequisite for complex light circuits, such as for quantum information processing for a new generation of computers. The researchers are now presenting their results in the journal Nature Photonics.

Light particles (photons) occur as tiny, indivisible portions. Many thousands of these light portions can be merged to form a single super-photon if they are...

Im Focus: Circular RNA linked to brain function

For the first time, scientists have shown that circular RNA is linked to brain function. When a RNA molecule called Cdr1as was deleted from the genome of mice, the animals had problems filtering out unnecessary information – like patients suffering from neuropsychiatric disorders.

While hundreds of circular RNAs (circRNAs) are abundant in mammalian brains, one big question has remained unanswered: What are they actually good for? In the...

Im Focus: RAVAN CubeSat measures Earth's outgoing energy

An experimental small satellite has successfully collected and delivered data on a key measurement for predicting changes in Earth's climate.

The Radiometer Assessment using Vertically Aligned Nanotubes (RAVAN) CubeSat was launched into low-Earth orbit on Nov. 11, 2016, in order to test new...

Im Focus: Scientists shine new light on the “other high temperature superconductor”

A study led by scientists of the Max Planck Institute for the Structure and Dynamics of Matter (MPSD) at the Center for Free-Electron Laser Science in Hamburg presents evidence of the coexistence of superconductivity and “charge-density-waves” in compounds of the poorly-studied family of bismuthates. This observation opens up new perspectives for a deeper understanding of the phenomenon of high-temperature superconductivity, a topic which is at the core of condensed matter research since more than 30 years. The paper by Nicoletti et al has been published in the PNAS.

Since the beginning of the 20th century, superconductivity had been observed in some metals at temperatures only a few degrees above the absolute zero (minus...

All Focus news of the innovation-report >>>

Anzeige

Anzeige

Event News

Call for Papers – ICNFT 2018, 5th International Conference on New Forming Technology

16.08.2017 | Event News

Sustainability is the business model of tomorrow

04.08.2017 | Event News

Clash of Realities 2017: Registration now open. International Conference at TH Köln

26.07.2017 | Event News

 
Latest News

A Map of the Cell’s Power Station

18.08.2017 | Life Sciences

Engineering team images tiny quasicrystals as they form

18.08.2017 | Physics and Astronomy

Researchers printed graphene-like materials with inkjet

18.08.2017 | Materials Sciences

VideoLinks
B2B-VideoLinks
More VideoLinks >>>