Positive Affect and Malleable Mental Accounting: An Investigation of the Role of Positive Affect in Flexible Expense Categorization and Spending

The present research examines the impact of positive affect on mental accounting and the underlying mechanisms. The authors find that individuals in a positive (vs. neutral) affective state are less likely to exploit ambiguity in mental accounts and justify spending, but only when processing resources are unconstrained. In contrast, when processing resources are limited (high cognitive load), those in a positive (vs. neutral) affective state are more likely to spend. These findings offer new insights into the interplay between affect and cognition in decision making, the use of mental accounting strategies, and the role of affect in spending and self‐control.     

Decisions with ChatGPT: Reexamining choice overload in ChatGPT recommendations

This research examines how individuals respond differently to recommendation options generated by ChatGPT, an AI-powered language model, in five studies. In contrast to previous research on choice overload, Studies 1 and 2 demonstrate that people tend to respond positively to a large number of recommendation options (60 options), revealing diverse consumer perceptions of AI-generated recommendations. Studies 3 and 4 further illustrate the moderating effect of recommendation agents and indicate that choice overload elicits distinct patterns of consumer reactions depending on whether the recommendations are from a human or AI agent. Lastly, Study 5 directly measures consumer preferences for recommendation agents, revealing a general preference for ChatGPT, particularly when a large number of options are available. These findings have significant implications for recommendation system design and user preferences regarding AI-powered recommendations.     

Impact of flow on recognition of and attitudes towards in-game brand placements

This study investigates the moderating influences of brand congruence and placement prominence on the impact of game-evoked flow on cognitive and affective outcomes for in-game brand placements. In two studies, the authors demonstrate that experiencing flow while gaming tends to contribute positively to affective outcomes, leading to more positive brand attitudes, but it has no impact on cognitive processing or brand recognition. In particular, brand congruence moderates the impact of flow, leading to more positive brand attitudes and brand recognition. Brand prominence moderates the impact of flow only on brand recognition, not on brand attitudes. These findings offer several implications, limitations and directions for further research.     

The Impacts of Affective and Cognitive Social Conflict in Business-to-Business Buyer-Seller Relationships: A Comparison of New versus Ongoing Buyer-Seller Relationships

ABSTRACT

Purpose. The purpose of this paper is to report empirical research that examined the impact of conflict in two different buyer-seller situations, an ongoing relationship and a choice situation where the buyer had to choose between two or more alternative suppliers. Conflict was defined as social conflict and has two distinct types, affective and cognitive.

Methodology/Approach. The methodology used was two mail surveys to a random sample of purchasing association members who had buying responsibilities in their firms. In one survey respondents were asked to self-select a current buyer-seller relationship they had for a period of at least one year and to indicate the degree of perceived conflict they had with the key supplier representative as well as the amount of relationship loyalty they perceived they had with that supplier. The second survey randomly assigned respondents to evaluate either a supplier whom they gave business to in a choice situation or one they did not, thus establishing as the dependent variable the actual choice of whom they gave business to.

Findings. The findings are clear for affective types of conflict. When affective conflict is perceived as higher the chance of getting an order in a choice situation as well as the magnitude of the relationship loyalty perception is negatively related. Cognitive conflict is not as clear. In choice situations conflict was negatively related to choice, whereas in on going relationships there was no impact. There was no indication of cognitive conflict having a positive relationship.

Originality/Value/Contribution of the paper. This study is the first to examine perceptions of conflict with a significant other in a buyer-seller relationship to try to determine how those perceptions might relate to either buyer choice or loyalty. While the findings support the expected relationship between affective conflict and outcomes, the findings with regards to cognitive conflict suggest that this may be more complex then originally thought and further points out the difficulty in managing conflict across organizational boundaries.     

LINKED RECURSIVE PREFERENCES AND OPTIMALITY

We study a class of optimization problems involving linked recursive preferences in a continuous‐time Brownian setting. Such links can arise when preferences depend directly on the level or volatility of wealth, in principal–agent (optimal compensation) problems with moral hazard, and when the impact of social influences on preferences is modeled via utility (and utility diffusion) externalities. We characterize the necessary first‐order conditions, which are also sufficient under additional conditions ensuring concavity. We also examine applications to optimal consumption and portfolio choice, and applications to Pareto optimal allocations.     

The impact of retail out-of-stock options on preferences: The role of consumers’ desire for assimilation versus differentiation

This study tested the hypothesis that retail customers’ drive to assimilation or differentiation moderates the effect on their initial preference for a particular product of their discovery in the store of a previously unconsidered comparable alternative, which happens to be presently out of stock. The results revealed that new awareness of alternative options has an impact on customers’ preferences, even if they are unavailable when the choice is being made. Participants who were more concerned with differentiation exhibited a stronger preference for the option originally under consideration if they were told that the alternative was out of stock due to heavy demand rather than short supply. By comparison, those more concerned with assimilation had a weaker preference for the initial product when they learnt that its unavailability was said to be due to heavy demand, not supply shortfall. The article concludes with theoretical implications and areas for future research.     

The Relationship between task complexity and information search: The role of self‐efficacy

Prior research suggests the complexity of a product choice task is inversely related to the extent of consumers' external information search. The resource‐matching perspective holds that cognitive effort (e.g., external information search) is greatest when available cognitive resources (e.g., as determined by self‐efficacy) match the cognitive demands of a task (e.g., perceived task complexity). Within a brand‐choice context, the relationship between self‐efficacy and extent of information search appears nonmonotonic. In support of the resource‐matching perspective, consumers conduct the most extensive information search when their self‐efficacy matches perceived task difficulty. © 2007 Wiley Periodicals, Inc.     

Combined influence of selective focus and decision involvement on attitude–behavior consistency in a context of memory‐based decision making

Marketers often use salient stimuli to draw consumers' attention to a specific brand in the hope that a selective focus on the brand increases the sales of this brand. However, previous studies are inconsistent concerning the impact that selectively focusing on a specific brand has on final brand choice. To offer an explanation for these inconsistent results, this paper introduces decision involvement as a moderator of the relation between selective focus and attitude–decision consistency. Two studies indicate that selectively focusing on a not preferred alternative indeed alters choice decisions, but only when decision involvement is low. Study 1 further shows that this interaction effect between selective focus and involvement takes place in the selection rather than the brand consideration stage. By introducing level of processing along with decision involvement, Study 2 shows that the interaction effect emerges even in limited processing conditions. The study also reconciles different explanations for the negative effect of selective focus on attitude–behavior consistency. Selectively focusing on a not preferred choice option when consumers are low involved and use limited processing seems to lead to inconsistent choices because of an increased accessibility of the focal option, whereas selective focus on a not preferred option when consumers are low involved and use deep processing lead to inconsistent choices because of attitude polarization. © 2011 Wiley Periodicals, Inc.     

How humor in advertising works: A meta-analytic test of alternative models

This study tests a cognitive and an affective model based on extant explanations of the effects of humor along with a new affective?Ccognitive model. Results are derived from meta-analytic data and show how previous explanations may be integrated in order to explain how humor in advertising works. Humor reduces negative cognitions related to the ad because it serves as a distraction from counter-argumentation. In order to maintain positive affect, humor reduces cognitive efforts, in particular those related to brand-related cognitions, thus supporting a vampire effect; that is, humor distracts from processing central benefits of the brand. Humor exerts its strongest impact along affective paths, supporting the dominance of affective mechanisms. Affect and cognition do interplay in line with a congruency effect where the impact of positive affect on attitudes towards the ad is mediated by positive cognitions. The models differ when they are performed based on data from studies using either real or fictitious stimuli. Depending on the type of stimuli, slight changes occur that can be explained by the lack or existence of prior brand experience. Overall, the integration of affect and cognitions into one model provides a better explanation than the previous solely cognitive or solely affective models.     

Is money really the root of all evil? The impact of priming money on consumer choice

Despite the ubiquitous importance of money, the psychology of money has until recently received relatively little attention. While the literature has found that priming money has notable psychological consequences, little research has been done on the impact of priming money on consumer choice, particularly, their choice between hedonic and utilitarian options. The current research proposes that priming money will increase the likelihood of a prevention regulatory focus, and consequently, consumers will be more likely to choose more prudent alternatives when facing a trade-off between hedonic and utilitarian options. Results of four experiments show that participants in the money priming condition were more likely to choose utilitarian over hedonic options, compared with participants in the control condition. Furthermore, this effect was mediated by consumers’ situational prevention focus on the exposure to money primes, but attenuated when credit cards are primed.     

Negative and positive customer shopping experience in an online context

Underpinned by the Bagozzi and Dholakia (1999) goal setting and striving framework this research firstly develops a negative online customer experience model after which regulatory focus theory is used to compare this model with a positive online customer experience model. Analysis of responses from 201 respondents in the first study shows service failure causes negative affective and cognitive experience and has an impact on dissatisfaction and negative word of mouth in the online retailing context. Moreover, results of a second study among 200 respondents indicates that while customer priority in a successful shopping context is affective experience, in a service failure the customer priority moves from an affective to a cognitive experience. Similarly, compared to cognitive experience, affective experience has a higher impact on customer satisfaction and positive word of mouth in a successful shopping context, while in an unsuccessful shopping context cognitive experience has higher impact on dissatisfaction and negative word of mouth. The findings of this study contribute to customer experience management in both successful and unsuccessful shopping situations.     

More Than Aesthetic: Visual Boundaries and Perceived Variety

Many online retailers use seemingly innocuous visual boundaries when presenting choice sets to consumers. In contrast to previously studied aspects of information presentation, visual boundaries do not alter underlying information structure. The authors argue that, beyond their aesthetic role, visual boundaries can systematically increase or decrease perceived choice variety but the impact of visual boundaries on variety perceptions depends on consumer cognitive load. Study 1 finds that, by-attribute (vs. alternative) boundaries increase (decrease) perceived variety under high but not low cognitive load. Study 2 further demonstrates that retailer intent moderates the interaction between visual boundaries and cognitive load such that, when cognitive load is high, effects of visual boundaries on perceived variety are strengthened when consumers believe that retailers use boundaries to aid consumer navigation but reversed when they believe retailers use boundaries to persuade consumers to make purchases. Finally, Study 3 rules out attribute order and number of attribute levels as alternative accounts for the effect and enhances generalizability through a different manipulation of cognitive load. This work advances understanding of how simple environmental cues affect consumer behavior, with implications for retail strategy.     

How Hand Proximity Impacts Consumer Responses to a Persuasive Communication

This research examines the impact of hand proximity (i.e., proximal or distal) on how consumers process the information contained in an advertisement or on a product Web site. Four studies demonstrate that when hands are proximal to that information (e.g., when using a mobile device to view the information), there is more detail‐oriented processing that results in greater attribute recall and a greater amount of attribute‐related thoughts. When hands are distal to that information (e.g., when using a desktop to view the ad or product Web site), there is more holistic, conceptually oriented processing that results in greater thematic recall and more thoughts about the theme. This research also demonstrates that hand proximity can differentially impact choice and product evaluations. Specifically, when hands are proximal consumers prefer ads communicating detailed product information; when hands are distal consumers prefer ads that focus on a theme. Hand proximity effects are driven by the innate tendency to manipulate or inspect an item. The research has important practical implications, given the ubiquity of both hand‐held devices and computers.     

Scared Stiff? The Effectiveness of Threat Appeals in Counseling Services Advertising to High‐Anxiety Students

This exploratory study proposes and tests a theoretical model that analyzes threat appeals in regard to their effectiveness for high‐anxiety students, one of the major target groups for counseling services. In particular, affective and cognitive responses to a threat appeal advertisement and their effects on attitude toward the advertisement and behavior are examined. The results suggest that a strong threat appeal is not effective for counseling services but that positive emotions toward the advertisement and cognitive involvement have a positive impact on advertising outcomes. The study contributes further to knowledge of threat appeal effectiveness, targeting “anxious” audiences.     

I'll Have Fries with That: Increasing Choice Complexity Promotes Indulgent Food Choices

Three studies showed that the way that options are presented in a choice set—as combinations of intersecting attributes or in a more sequential “a la carte” choice format—affects the degree to which consumers adhere to their goals in the consumption setting. Specifically, using the context of food consumption and healthy eating, results showed that consumers were more likely to make double indulgent choices, the choice of both an indulgent entrée and an indulgent side item, when choosing from a menu consisting of predetermined “combination meals” than when selecting among the same entrée and side options in an a la carte fashion. Studies 2 and 3 implicated a goal distraction mechanism in driving the effect; the combination format, with its cross‐cutting of product choices into various combinations, reduces the salience of goal‐related constructs on implicit measures. In showing that different product presentation formats can affect the degree to which consumers make goal‐consistent choices, the current work adds to work on the effects of environmental influences on goal progress and goal achievement. Implications for encouraging goal‐consistent behavior in the context of healthy eating as well as other important consumer goal contexts are discussed.     

How advertising literacy training affect children's responses to television commercials versus advergames

This study examined children's advertising literacy level for traditional versus embedded advertising formats by comparing their cognitive and affective advertising literacy level for television commercials vs. advergames. The study also explored how cognitive and affective advertising literacy further attenuate advertising effects by investigating the mediation impact of cognitive and affective advertising literacy on the relation between the ad's format and the purchase request. Third, the study investigated how an advertising literacy training session moderates these effects.

The results of this experimental study showed that advergames lead to a higher purchase request rate among children than television commercials. However, only affective but not cognitive advertising literacy mediated the effect of the advertising format on purchase request. In addition, a training session was shown to accelerate children's cognitive (but not their affective) advertising literacy for advergames, but not for television commercials.     

Means–end analysis: Does the affective state influence information processing style?

Means–end theory aims at explaining how consumers evaluate products by linking relevant attributes to perceived consequences to desired ends in a hierarchical way, based on core assumptions of cognitive psychology about human information processing. This study investigates the influence of affective states on information processing styles in a means–end measurement situation, thus taking into account an important antecedent and correlate of human decision making and behavior that has received scarce attention so far in the methodological literature on means–end chains. The results reveal that a person's affective state indeed influences the style of information processing. Respondents in a positive mood used more general knowledge structures and processed the laddering questionnaire faster than respondents in a negative or neutral mood. The laddering technique, which measures means–end chains, thus seems to be sensitive to situational effects, and this finding indicates that affective states then also might have an influence on product knowledge and the decision‐making process in a purchase situation. © 2004 Wiley Periodicals, Inc.     

Production and hedging under state‐dependent preferences

This study examines the behavior of the competitive firm under output price uncertainty and state‐dependent preferences. When there is a futures market for hedging purposes, the firm's optimal production decision is independent of the output price uncertainty and of the state‐dependent preferences. If the futures contracts are unbiased, the firm's optimal futures position is an over‐hedge or an under‐hedge, depending on whether the firm is correlation averse or correlation loving, and on whether the output price is positively or negatively expectation dependent on the state variable. When the firm has access not only to the unbiased futures but also to fairly priced options, sufficient conditions are derived under which the firm's optimal hedge position includes both hedging instruments. This study thus establishes a hedging role of options, which is over and above that of futures, in the case of state‐dependent preferences. © 2011 Wiley Periodicals, Inc. Jrl Fut Mark 32:945–963, 2012     

Experiential product attributes and preferences for new products: The role of processing fluency

This study shows how experiential product attributes that are part of the design of new products can create compelling consumer experiences. Following processing-fluency theory, when consumers attend to experiential attributes (sensory or affective), they should process them fluently (i.e., spontaneously and with little effort); however, consumers should process functional attributes always deliberately, irrespective of whether or not they attend to them. An experiment testing the fluency hypothesis confirms that the processing of experiential attributes, but not functional attributes, depends on attention focus. When consumers focus their attention on specific experiential features, products with experiential attributes are evaluated more positively. In contrast, the processing of functional attributes does not depend on attention focus. Further confirming the fluency hypothesis, the experiment also shows that presentation duration does not affect the processing of experiential attributes but does affect the processing of functional attributes. The authors discuss how marketers can use experiential product design in market segmentation and innovation.     

Compromise and attraction effects in food choice

Food choices are being implicated as a key driver in the rising rates of obesity, as well as associated with other health problems that impact both individuals and society as a whole (Cawley and Meyerhoefer). Calorie listings, whether provided on menus or packaged goods, increase consumer's awareness of the calories in potential food choices and, as a result, make consumers more likely to evaluate a product relative to others in the choice set based on this attribute (e.g. choosing a higher or lower calorie option). In this research, we explore whether the provision of calorie information, when presented in the context of other food options, will result in (1) compromise effects, whereby individuals select intermediate (or middle) options in a choice set, and (2) attraction effects, whereby individuals gravitate towards items that are similar to others but also dominate these items in the choice set. In two experimental studies we find evidence for the compromise effect and the attraction effect. These findings extend work demonstrating that the context in which food decisions occur can impact choice, and builds on existing knowledge regarding the consequences of providing calorie information for food items. Although most work has shown that making calories salient has a beneficial impact on the accuracy of consumer calorie estimates and food choice, in this work we show that the compromise and attraction effects – two well‐established findings in decision‐making literature – can actually shift consumers to either higher or lower calorie options. This carries important implications for consumers making choices in information‐rich choice environments.