You get what you think you pay for……….
It’s often said that here in the UK we’re a nation of shoppers
Every week our high streets and shopping malls are packed full of people eager to consume goods. So you think we’d be pretty good at it.
But according to the latest research, it seems that most of us aren’t. Sure, we might be able to spot a bargain or two. But when it comes to identifying real quality, we all do pretty much the same thing and go by the price.
The more it costs, the better we assume it is. Of course, that’s not a bad yardstick so long as retailers play ball. But as the research suggests, we’re very easily conned into thinking something is better than it is.
Two recent studies in the US set out to prove that not only do prices affect our expectations of quality, but that we actually enjoy a product more if it’s priced higher. In the study, Professor Antonio Rangel from the California Institute of Technology asked people to sample five different varieties of wine, informing them of the price of each as they tasted it. However, in reality, they only sampled three wines because two were offered twice.
The first wine they were told came from a bottle costing $5. Later, this very same wine was offered to them but this time they were told it cost $45. Similarly, they were given a more expensive wine to taste – $90 a bottle – and then later, offered the same wine but told it cost only $10. Finally, they were offered one sample of wine which was correctly priced at $35 a bottle. I don’t know about you but I’m feeling thirsty.
You can probably guess the outcome. Not only did the subjects rate identical wines as tasting better when told they were pricier, but brain scans showed greater activity in the medial orbitofrontal cortex – known to be related to the experience of pleasure. In other words, they genuinely experienced greater pleasure from an identical object when they thought it cost more.
So armed with the knowledge that people prefer cheap wine to the expensive stuff when charged more, what does that tell us? That’s right, we ought to be in the licensing trade.
And there’s more. In another US study, 82 healthy volunteers were recruited to try out a new opioid pain relief pill. They were told it was similar to codeine, only faster-acting. Divided into two groups, one was told that the pill cost $2.50 a pop, the others that it was a mere 10 cents. Then at great expense, ex-professional torturers were flown in from south America to expertly apply light electric shot treatment to their wrists both before and after taking the pill.
I may have elaborated there.
Anyhow, you can probably guess the results once more. Of the patients who took the full-price pill, 85% said they felt less pain after taking it, compared with 61% of those who took the 10-cent pill. In truth, they all took nothing more than a sugar pill with no active ingredient whatsoever. Thus proving the power of the placebo: we experience what we expect to experience.
The conclusion? The price of an item and what we are told about it directly affects our enjoyment and the way we experience its value. We don’t want cheap brands. We just want brands cheap.
And if you want to buy your colleagues and friends a great present what better than a ‘laugh out loud’ hard back book that looks really expensive?