How valuable is a well‐crafted design and name brand?: Recognition and willingness to pay

Abstract

ABSTRACT Preferences for similarly designed consumer products, evaluated blind and branded and also with and without prices, were tested in a consumer setting. The consumer's perceptual experience led to preference of the well‐crafted high‐priced option. This preference was enhanced by priming consumers with background information about the brand, perhaps causing the subjects to guess which choice was the well‐known brand before evaluation. Preferences for that choice increased again when brand names were visible during evaluation. When actual prices were added to the evaluations, preferences for the well‐known brand were very robust to high prices, indicating the strength of the brand name. Using the least preferred option and the lowest price as an anchor, the consumers' price threshold to pay for the preferred design and the brand name was computed. Attempts to explain and predict individual differences of choices using measures of inherent design acumen, prior experience, and purchasing behavior were largely unsuccessful. Copyright © 2011 John Wiley & Sons, Ltd.

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