AXA Research Fellow
|Year of selection||2015|
|Institution||Katholieke Universiteit Leuven|
Type of support
120 000 €
Previous research showed that marketing campaigns promoting tempting products (such as high-calorie snacks, cigarettes, luxuries, or alcohol) increase the extent to which consumers engage in risky behaviors (such as overeating, smoking, overspending, or drunk driving). The mechanisms through which tempting marketing cues (e.g., advertisements for high-calorie snacks) increase risk-taking are however never empirically tested. The objective of this research is to systematically test how tempting cues influence risk-taking. Prospect theory (the dominant theory of decision making under risk) shows that there are two pathways through which the cues may influence risk-taking: through their effect on the (un)desirability of the outcomes or/and through their effect on the perceived probabilities of the outcomes. To illustrate, advertisements for high-calorie snacks may not only increase the desirability of these snacks (or decrease the undesirability of health problems), but may also decrease the estimated probability that health problems may occur (or increase the estimated probability that high-calorie snacks will be acquired). Prospect theory indexes these two components in a value function and a probability weighting function, respectively.
We will use a controlled laboratory experiment to test how tempting marketing cues influence these two different functions. The experimental paradigm involves the completion of an elicitation task while being exposed to either tempting or neutral cues. The elicitation task uses the state-of-the art technique to measure prospect theory’s value function and probability weighting function for each participant in the sample. Up until now, risk-reduction campaigns are built on the assumption that tempting marketing cues increase the desirability of temptations, and that this dynamism can be offset by imposing taxes. The campaigns often do not take into account that tempting cues may also influence the other component of risk preferences, namely probability perception. This may have substantially undermined the effectiveness of the campaigns carried out so far. The results of this research can thus be used to further optimize the effectiveness of social marketing campaigns.
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