The Higher the Price the Better the Result? The Placebo-Like Effects of Price and Brand on Consumer Judgments

I-Ling Ling, Chih-Hui Shieh, Jun-Fang Liao

Department of Distribution Management, National Taichung University of Science & Technology, Taichung, Chinese Taipei.
Department of International Business, Wenzao Ursuline College of Languages, Kaohsiung, Chinese Taipei.
Graduate Institute of Marketing & Logistics/Transportation, National Chiayi University, Chiayi, Chinese Taipei.

DOI: 10.4236/tel.[phone]                

Abstract

This research investigates the placebo effects of price and brand on consumer judgment and focuses on how two psychological moderators, deliberation thinking and self-confidence, influence the placebo-like effects. Two experiments were conducted. The results show that although different prices and brands on the same product would not influence consumers’ taste evaluation, they would affect participants’ grades in the memory test. That means there is a placebo effect on price/brand cues. The results also indicate that the placebo effect of price is more influenced by the discounted price than the regular price when people have low deliberation thinking. Furthermore, the findings show that the effects of brand and self-confidence create an interaction effect. Self-confidence moderates the placebo effect of brand on consumers’ judgment. Theoretical and managerial implications of the findings are provided.

Keywords

Placebo Effect; Price; Brand; Deliberation Thinking; Self-Confidence

Conflicts of Interest

The authors declare no conflicts of interest.

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