Do you feel instant ownership of items you touch in stores?
Does touching objects and the ensuing ownership lead you to value the objects more than you would have had you not touched it?
Does that higher value translate into higher Willingness to pay?
A recent study by two marketing professors from Booth School and Anderson school finds that the answer to all these questions is yes. A less academic version of the research report is available in TIME magazine.
Professors Joann Peck and Suzanne Shu, posed the questions
Does holding an object and imagining that it is yours influence how much the object is valued? More generally, does mere touch influence the feeling of ownership and the valuation of an object?
The core premise that ownership increases perceived value (endowment effect) in itself is not new and the authors do state twenty years of research on endowment effect. What is innovative in this research is finding that touch as a way to increase ownership and directly relating it to higher willingness to pay.
What does this mean to you as a customer?
- As a tourist wandering the local streets for merchandise, resist the temptation to hold the item. Or have a partner and have them touch it while you negotiate.
- If you are buying a new car, do not negotiate after the test drive. In fact do your test driving with a completely different dealership and buy from another.
- If you are buying used car, do not negotiate right away or follow Tip-1.
- If you are looking to buy a house do not imagine, this will be my workspace, this will be the baby’s room etc. Be aware of your agent telling you, “imagine yourself cooking in the kitchen and your kid playing here …”. Be detached.
- At garage sales, don’t touch anything.
What does this mean to you as a marketer?
- Do not try to sell, do not talk price . Let the customers play with the items. Engage the customers first then sell.
- For new cars, make the customer test drive, take a picture of the customer at the wheel or standing with the car and give it to them.
- Same for selling used cars.
- If you are selling a house, buy Polaroid (do they sell them?) and keep them for use during showings. Encourage the showing agent to shoot pictures of the prospective buyers in the house and give the pictures to them. Make the visitors feel that they “own” it. This is the reason home staging works.
- At garage sales, encourage touching your wares.
What do you think?