Framing: A tool to ease the pain of paying

Hannah Bateson • 3 min read

Introduction

The rise of E-Commerce amid the COVID-19 pandemic has inevitably changed the way consumers interact with products before making the decision to pay for them. This decision, we know, is psychologically painful because we, as humans, are inherently loss averse.

A key difference in our interaction with this sense of loss is in how we actually come to confront a product’s price.

In a shop, we are drawn towards a rack of clothes, tempted to browse through them and feel them before we ever encounter a price tag. Sometimes, we have to search for the tag, requiring effort that we’d rather save. All these physical barriers are in play to motivate us to want the product so that, by the time we confront its price, we are so convinced that our gain is worth our potential loss.

Online, however, these physical barriers don’t exist. Each and every product is visually matched with its price. Our confrontation with this monetary loss is, therefore, immediate. On top of this, our uncertainty of the product’s quality makes us question the value of our potential gain.

So, where does E-Commerce go from here?

Insights from Behavioural Science tell us that, while numbers are objective in their representation of price, their perceptions can be subjectively interpreted depending on how they are framed.

Framing effects describe how the context in which a decision is presented can influence how a person makes their final decision. These contexts allow consumers to make relative comparisons with other products. If done effectively, they can allow customers to dissociate some degree of loss with the product’s price, subsequently increasing their motivation to go through with its purchase.

 

Here are 2 ways framing can be used to ease the pain of paying.

 

1 ] Anchoring

A highly priced product can deter us from buying it, but an even more highly priced product can serve to remind us of its value. This shift in perceptions is known as the anchoring effect – a type of framing that uses one piece of information to serve as a reference point to which another piece of information is compared.

One way E-Commerce has used this effect is in their placement of premium products above others. J. Crew does this with their online shop – placing premium products at the top of their site, before customers then view their other, more averagely-priced items.

Because the premium product serves as their initial reference point, the drastic jump between numbers frames the more modestly priced alternative to be a great deal.

So, instead of fixating on loss, the customer is now thinking of the immense potential gain they would get by buying a jacket worth $99 dollars from a shop that also sells coats for over a thousand.

 

2 ] Removing commas and decimals

Have a look at these numbers:

£1900

£1,900.00

While these numbers denote the same price, your brain processes them differently. In fact, a study by Coulter, Choi and Moore (2012) found that students shown the first number rated how expensive they thought the product was as lower, on a scale of 1 to 10, than students who were shown the second.

Why?

Because adding commas and decimals to a number changes the way the numbers are read. £1900 is commonly read as “nine-teen hundred”, while £1,900.00 is read as “one-thousand nine-hundred”. The commas elongate the time taken for someone to read and process the number, leading them to perceive it as greater in magnitude – or, more expensive in price.

Airbnb has used this frame to label the homes they advertise. This allows future holiday seekers to focus their attention on the quality gains they can acquire from their Airbnb experience for a reasonable sounding price.

 

Reminder: Be Ethical

While these nudges incredibly impactful in their ability to enhance UX design for e-commerce, remember that a nudge is only ethical if we preserve the consumer’s right to choose. The purpose of these nudges should simply be to guide the consumer towards making positive evaluations of a product. The choice of pursuit, ultimately, must remain theirs.

 

Conclusion

The sense of loss a price tag triggers is likely to overwhelm consumers before they can properly assess a product’s value. With framing effects, however, consumers are nudged towards evaluating a product for its potential gain and realistic value – before their tendency for loss aversion interferes. With anchoring and the omittance of commas and decimals to shorten the auditory perception of a price tag, you can surely achieve this.

 

References

Ariely, D. (2008, December). Are we in control of our decisions? TED. https://www.youtube.com/watch?v=9X68dm92HVI

Coulter, K. S., Choi, P., & Monroe, K. B. (2012). Comma N’ cents in pricing: The effects of auditory representation encoding on price magnitude perceptions. Journal of Consumer Psychology22(3), 395–407. doi:10.1016/j.jcps.2011.11.005

Wu, C.-S., & Cheng, F.-F. (2011). The joint effect of framing and anchoring on internet buyers’ decision-making. Electronic Commerce Research and Applications, 10(3). https://doi.org/10.1016/j.elerap.2011.01.002

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