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Do consumers prefer offers that are easy to compare? An experimental investigation

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  • Crosetto, Paolo
  • Gaudeul, Alexia

Abstract

Abstract Consumers make mistakes when facing complex purchasing decision problems but if at least some consumers disregard any offers that is difficult to compare with others then firms will adopt common ways to present their offers and thus make choice easier. We design an original experiment to identify consumers’ choice heuristics in the lab. Subjects are asked to choose from menus of offers and we measure the extent to which they favor those offers that are easy to compare with others in the menu. A sufficient number of subjects do so with sufficient intensity for offers presented in common terms to generate higher revenues than offers that are expressed in an idiosyncratic way.

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Bibliographic Info

Paper provided by University Library of Munich, Germany in its series MPRA Paper with number 36526.

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Date of creation: 08 Mar 2012
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Handle: RePEc:pra:mprapa:36526

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Keywords: Bounded Rationality; Cognitive Limitations; Standards; Consumer Choice; Experimental Economics; Heuristics; Pricing Formats; Spurious Complexity;

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Cited by:
  1. Johannes Abeler & Simon Jäger, 2013. "Complex Tax Incentives - An Experimental Investigation," CESifo Working Paper Series 4231, CESifo Group Munich.

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