Cost Conscious? The Neural and Behavioral Impact of Price Primacy on Decision Making

by UMA R. KARMARKAR, BABA SHIV, and BRIAN KNUTSON on JMR

Positioning

The order effect of information presentation can influence decision

Exposure to stimulus results in immediate affective preference formation

People don't evaluate the price in a vacuum. It can have an impact on how a product is evalulated, such as focusing on the overall worth of a product, etc.

Conceptual and Empirical

Hypothesis

• H1: Price vs. product presentation order -> decision-making

• H2: Price primacy (presenting price first) -> increase considerations of product's monetary worth

• H3a: Price primacy -> increase activity patterns related to perceived monetary value in MPFC

• H3b: Price primacy -> does not decrease activity patterns related to product value in MPFC and preference in the NAcc

• H4: Price primacy -> increase the likelihood of purchasing utilitarian product

Experiment:

• Choice tasks of deciding purchase

• Price first / Product first picture - Joint picture - Decision picture

• Preference survey for product post-choice task

Result

• Price did not shift value, simply make one aspect (monetary) more sailent

H1: Changing the sequence in which price and product information are encountered changes the decision-making process. H2: In contrast to product primacy, price primacy causes a qualitative shift in how product value is determined, increasing considerations of an item's (monetary) worth.

General Issues