tag:theconversation.com,2011:/global/topics/marketing-ploys-30681/articlesMarketing ploys – The Conversation2023-06-20T05:49:34Ztag:theconversation.com,2011:article/2077282023-06-20T05:49:34Z2023-06-20T05:49:34ZWhy are we paying so much for alcohol-free drinks that aren’t taxed?<figure><img src="https://images.theconversation.com/files/532831/original/file-20230620-27-fy6fr8.jpg?ixlib=rb-1.1.0&rect=67%2C0%2C5579%2C3181&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Dry July, an <a href="https://www.dryjuly.com/">Australian fundraising campaign</a> to support people affected by cancer, is almost here again. The premise is that abstaining from booze and hangovers for a month frees up money to donate.</p>
<p>But with prices in the <a href="https://intheblack.cpaaustralia.com.au/innovation/why-non-alcoholic-beverages-industry-booming">booming alcohol-free drinks category</a> often <a href="https://www.news.com.au/lifestyle/food/drink/why-do-nonalcoholic-drinks-cost-so-much-in-australia/news-story/303a63e02fdaad4b623e7faf11ee8f09">rivalling those of regular tipples</a>, participants this year might find they have less spare cash than they anticipate.</p>
<p>Traditional alcohol producers, who have expanded into the <a href="https://www.theiwsr.com/no-and-low-alcohol-category-value-surpasses-11bn-in-2022/">US$11 billion</a> non-alcoholic drinks industry, have helped make the high prices charged seem acceptable to consumers by using a marketing tactic called price-anchoring.</p>
<h2>Lured into paying more</h2>
<p>When we encounter a new product, we latch onto whatever seems relevant in the immediate environment to estimate its value. Sellers often exploit this by staging information at purchase points. The classic is a price tag with $99 struck out and $79 written in. Whether it’s accurate or not, the $99 reference point shapes our perception of value and price.</p>
<p>This so-called “<a href="https://www.talon.one/glossary/price-anchoring">price anchoring</a>”, is just one example of the broader <a href="https://www.science.org/doi/10.1126/science.185.4157.1124">anchoring cognitive bias</a> described by psychologists Amos Tversky and Daniel Kahneman.</p>
<p>The essence of anchoring is that we tend to rely too heavily on an initial piece of information (the “anchor”) when making decisions. This can lead to skewed judgements and <a href="https://helpfulprofessor.com/anchoring-bias-examples/">poor decisions</a> in everything from deciding whether to have surgery to buying real estate.</p>
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Read more:
<a href="https://theconversation.com/australias-system-of-taxing-alcohol-is-incoherent-but-our-research-suggests-a-single-tax-rate-isnt-the-answer-195907">Australia's system of taxing alcohol is 'incoherent', but our research suggests a single tax rate isn't the answer</a>
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<p>Anchoring has been used to reinvent and elevate the virgin drinks category by exploiting the fact we are used to paying high prices for alcohol in bottles, cans or glasses of a certain size, shape and sophistication. When alcohol-free versions with similar labels appear beside them on the shelf, website or menu, we tacitly accept they should command roughly the same prices.</p>
<p>It’s not just that the next bottle along provides a suggestive price. Our brains, steeped in marketing, know that alcohol prices can range far upwards from “normal”, making them not just comparison points but the proverbial $99 scratched out. So even if we spend a lot on non-alcoholic wine, we feel like we have scored compared with what we might have dropped on a bottle of Grange.</p>
<h2>Where we are most susceptible</h2>
<p>The effect is strongest in bottle shops and bars, where the glitz of alcohol marketing, social pressure and the sheer number of expensive items overwhelms our rational thinking. But it also works on websites of the national liquor outlets where special zero-alcohol categories have been established beside the traditional beer, wine and spirits listings.</p>
<p>It doesn’t take much browsing to confirm that prices are similar. Currently, on one of the big retailers’ websites, a case of 330ml bottles of Heineken Lager (5% alcohol) is $55, Heineken 3 (3.3% alcohol) is $50, and Heineken Zero (less than 0.5% alcohol) is $49. Among the non-alcoholic spirits, 700ml of Lyre’s Dry London Spirit - “<a href="https://lyres.com.au/range/dry-london-spirit/">crafted to capture the essence of a classic gin</a>” - is $51 at another outlet while the same size bottle of 37% alcohol Gordon’s London Dry Gin is $45. Gordon’s own non-alcoholic offering - Gordon’s 0.0 Alcohol Free - is listed at $38.</p>
<p>Price anchoring in the alcohol-free market comes with an extra twist of lemon.</p>
<p>Brands will encourage you to think their investment in developing “healthier options” using “high-quality ingredients” means <a href="https://www.craftzero.com.au/blogs/craftzero-life/why-non-alcoholic-drinks-arent-cheap">high prices are fair enough</a>, and that a non-alcoholic drink made with arcane “botanicals” and “<a href="https://www.entrepreneur.com/living/adaptogens-in-non-alcoholic-beverages-are-on-the-rise-and/450472">adaptogens</a>” in a nice bottle is worth a splurge.</p>
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<img alt="Woman selecting wine in supermarket" src="https://images.theconversation.com/files/532827/original/file-20230620-21-ajfknu.jpg?ixlib=rb-1.1.0&rect=548%2C131%2C4914%2C3366&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/532827/original/file-20230620-21-ajfknu.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/532827/original/file-20230620-21-ajfknu.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/532827/original/file-20230620-21-ajfknu.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/532827/original/file-20230620-21-ajfknu.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/532827/original/file-20230620-21-ajfknu.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/532827/original/file-20230620-21-ajfknu.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">We get caught thinking it’s worth paying extra for non-alcoholic versions of well known brands.</span>
<span class="attribution"><a class="source" href="https://www.shutterstock.com/image-photo/woman-examines-bottle-wine-supermarket-shopping-2105786561">www.shutterstock.com</a></span>
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<p>But look at what makes up the price. All processed drinks incur a Goods and Services Tax (GST). And drinks that contain alcohol are hit with a heavy additional excise. The <a href="https://www.ato.gov.au/business/excise-on-alcohol/excise-duty-rates-for-alcohol/">exact percentage</a> is <a href="https://theconversation.com/australias-system-of-taxing-alcohol-is-incoherent-but-our-research-suggests-a-single-tax-rate-isnt-the-answer-195907">difficult to calculate</a>, but the alcohol-related tax on a bottle of full-strength beer can exceed 30%.</p>
<p>Industry players don’t pay that tax on non-alcoholic drinks. So, in a sense, they are pocketing a hefty bonus that well-anchored customers forget is not being passed on to the government. Ouch.</p>
<h2>Supermarkets and nurturing the next generation</h2>
<p>Seemingly at odds with price anchoring is the appearance of non-alcoholic versions of some famous brands in supermarkets.</p>
<p>An incentive for names like Heineken, Coopers and Gordon’s to be in supermarkets is visibility in a family-friendly environment. Their brand becomes recognisable to customers who are underage now, but will soon be ready to buy alcohol for their 18th birthday bash.</p>
<p>It’s a risky strategy, however, and can attract <a href="https://www.menzies.edu.au/icms_docs/327145_Zero-alcohol_beverages_%E2%80%93_harm-minimisation_tool_or_gateway_drink.pdf">adverse publicity</a>. In fact, to protect their reputations, several supermarket chains in New Zealand <a href="https://www.1news.co.nz/2022/11/08/why-are-supermarkets-checking-id-for-zero-per-cent-alcohol-sales/">require customers to show ID</a> when purchasing non-alcoholic lookalike drinks.</p>
<h2>Is there a way to overcome the illusion?</h2>
<p>The Australian government’s Behavioural Economics Team (BETA) has an informative <a href="https://behaviouraleconomics.pmc.gov.au/blog/anchors-away-prices-anchors-and-auctions">blog post on minimising the impact of price anchors</a>. But research suggests even <a href="https://onlinelibrary.wiley.com/doi/10.1111/j.1755-053X.2008.00018.x">experts are susceptible</a>.</p>
<p>Besides awareness, you can <a href="https://hbr.org/2015/05/outsmart-your-own-biases">reduce the effect</a> by curating your exposure to price information. If you need non-alcoholic drinks for home or an event, visit the supermarket before the bottle shop. The range may not be as big, the drinks may not be any cheaper, and you may need to go to the bottle shop anyway. But the experience will put the untaxed non-alcoholic products in a fairer context – the soft drink aisle. Comparing prices under those sober lights, you might suddenly feel like picking up a bottle of ginger ale instead.</p>
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Read more:
<a href="https://theconversation.com/were-getting-really-good-at-making-alcohol-free-beer-and-wine-heres-how-its-done-193318">We’re getting really good at making alcohol-free beer and wine. Here’s how it’s done</a>
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<p>In bars and clubs, you can try to flip the script. Ask for your soda water in a fancy glass with lots of ice and slices of lemon or lime. This anchors what’s in your hand to high-priced cocktails.</p>
<p>Of course, if you embrace the life of a true ascetic, H₂O is a <a href="https://earth911.com/business-policy/country-regulations-free-drinking-water/">zero-dollar option</a> that, <a href="https://www.goodreads.com/quotes/346824-water-is-sufficient-the-spirit-moves-over-water#:%7E:text=Quote%20by%20Friedrich%20Nietzsche%3A%20%E2%80%9CWater,the%20spirit%20moves%20over%20water.%E2%80%9D">as Nietzsche said</a> always suffices. In Dry July, you might even join the hype and call it non-alcoholic vodka.</p><img src="https://counter.theconversation.com/content/207728/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Cameron Shackell works for GeneriTrend, a firm using AI to quantify the genericness of brands and trademarks. Its customers at the time of publication do not include any drinks-related brands, alcoholic or otherwise.</span></em></p>Going alcohol-free can spare the hangover and save money - unless your new drink of choice is the zero-free version of certain high profile tipples.Cameron Shackell, Visiting Fellow, Queensland University of TechnologyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1813262022-04-24T20:18:43Z2022-04-24T20:18:43ZWhy getting less with shrinkflation is preferable to paying more<figure><img src="https://images.theconversation.com/files/459208/original/file-20220421-21-pbqfm5.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">shutterstock</span> </figcaption></figure><p>Have you noticed your favourite chocolate is <a href="https://www.moneymag.com.au/shrinkflation-food-paying-for-less">a little smaller</a>, there are <a href="https://startsat60.com/media/news/shoppers-angry-at-weet-bix-size-price-change">fewer biscuits in the same-sized package</a> or bags of chips <a href="https://www.9news.com.au/national/shrinkflation-sneaky-way-companies-australia-increase-grocery-price/2a030dc9-ed6c-4bf2-83d3-08ca9873c862">contain more air</a>? </p>
<p>If you haven’t, you’re not alone. </p>
<p>What marketers call a “contents reduction strategy” is more popularly known as “shrinkflation” – reducing the size of a product while the price remains the same.</p>
<p>It’s a comparatively recent phenomenon in the supermarket business, reflecting the pressure on manufacturers to keep prices down. In fact the word “shrinkflation” entered the lexicon <a href="https://corporatefinanceinstitute.com/resources/knowledge/economics/shrinkflation/">only in 2009</a>.</p>
<p>Since then, manufacturers have “shrunk” everything from <a href="https://www.facebook.com/7NEWSsydney/videos/downsizing-our-food/1059014464122686/">jars of Vegemite</a>, <a href="https://www.9news.com.au/national/shrinkflation-sneaky-way-companies-australia-increase-grocery-price/2a030dc9-ed6c-4bf2-83d3-08ca9873c862">Maltesers, Tim Tams</a>, <a href="https://finance.nine.com.au/business-news/freddo-frogs-cut-to-smaller-size-to-save-costs/e3d7b42c-155c-45d5-9c18-3074e7e45f10#:%7E:text=Cadbury%20has%20shrunk%20its%20Freddo,15g%2C%20the%20Herald%20Sun%20reports.">Freddo Frogs</a> and <a href="https://www.irishtimes.com/news/ireland/irish-news/kelloggs-changes-breakfast-cereal-boxes-to-cut-costs-and-help-the-environment-1.4564593">Corn Flakes</a>. In the United Kingdom, the Office for National Statistics counted <a href="https://www.ons.gov.uk/economy/inflationandpriceindices/articles/shrinkflationandthechangingcostofchocolate/2017-07-24">2,529 examples</a> between 2012 and 2017. </p>
<p>So why does shrinkflation seem preferable when it is effectively the same as putting up the price? </p>
<p>To investigate this, we conducted experiments playing with consumer perceptions of changes in prices and volume sizes. Our results show the innate cognitive bias shoppers have towards focusing on price, no matter what.</p>
<h2>How we tested the shrinkflation effect</h2>
<p>In <a href="https://link.springer.com/article/10.1007/s11747-019-00716-z">our experiments</a> we wanted to measure the relative effect of different strategies to increase a product’s per-unit price. </p>
<p>We simulated this in real-world conditions by manipulating shoppers’ perceptions of products for sale in a supermarket in Brisbane, then measured the differences in sales. The experiment took six weeks and involved five products – coconut rolls, confectionery, biscuits, soy milk and coconut water. </p>
<figure class="align-center ">
<img alt="Supermarket shelf showing soy and other milk products." src="https://images.theconversation.com/files/459222/original/file-20220422-16-g7itfz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/459222/original/file-20220422-16-g7itfz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/459222/original/file-20220422-16-g7itfz.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/459222/original/file-20220422-16-g7itfz.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/459222/original/file-20220422-16-g7itfz.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/459222/original/file-20220422-16-g7itfz.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/459222/original/file-20220422-16-g7itfz.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<p>We changed neither the price nor size of these products. But we did change the shelf tickets, to manipulate shoppers into believing the price or size had previously been different. </p>
<p>Each week over four weeks we changed the shelf tickets to test the following four scenarios, all implying an identical increase in the per-unit price: </p>
<ul>
<li><p>tactic 1 created the impression only the price had increased </p></li>
<li><p>tactic 2 created the impression the price was the same but the size had been reduced (standard shrinkflation) </p></li>
<li><p>tactic 3 created the impression the size has increased, but also the price had increased even more </p></li>
<li><p>tactic 4 created the impression the product’s price had been reduced, but also the size had been reduced even more (shrinkflation variant). </p></li>
</ul>
<p>The following images show how we did this with the coconut rolls.</p>
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<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/459255/original/file-20220422-20-ryrfj3.png?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="" src="https://images.theconversation.com/files/459255/original/file-20220422-20-ryrfj3.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/459255/original/file-20220422-20-ryrfj3.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=960&fit=crop&dpr=1 600w, https://images.theconversation.com/files/459255/original/file-20220422-20-ryrfj3.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=960&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/459255/original/file-20220422-20-ryrfj3.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=960&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/459255/original/file-20220422-20-ryrfj3.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=1207&fit=crop&dpr=1 754w, https://images.theconversation.com/files/459255/original/file-20220422-20-ryrfj3.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=1207&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/459255/original/file-20220422-20-ryrfj3.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=1207&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="caption">Examples of unit price increasing tactics used in the field experiment, by changing the ‘Was’ price and size information.</span>
<span class="attribution"><span class="source">Author provided</span></span>
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<p>The product and price never changed but the signs indicating the previous price and size did. In each case the “before” per-unit price was also shown – an identical 38 cents per 10 grams.</p>
<p>The other two weeks were used as “control” weeks. In one week we displayed a “New Package” shelf ticket. In the other control week we displayed a regular shelf ticket without the words “New Package”.</p>
<h2>What we found</h2>
<p>Even though the changes signalled by the shelf tickets represented an identical increase in per-unit price, the sale results suggest shoppers found our shrinkflation variant the most attractive.</p>
<p>The following chart shows the sales figures for all five products over the six weeks. With tactic 4 (our shrinkflation variant) 530 units were sold. This compares with 448 sales with tactic 3; 435 sales for tactic 2 (standard shrinkflation), and 391 sales for tactic 1.</p>
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<iframe title="The power of price reductions" aria-label="Bar Chart" id="datawrapper-chart-Oo30c" src="https://datawrapper.dwcdn.net/Oo30c/4/" scrolling="no" frameborder="0" style="border: none;" width="100%" height="301"></iframe>
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<h2>The power of framing</h2>
<p>These results demonstrate the commercial power of psychological “framing”.</p>
<p>First, there is the “<a href="https://pubsonline.informs.org/doi/abs/10.1287/mnsc.1090.1076">silver lining effect</a>” – a mixed outcome consisting of a small gain (a lower price) and a larger loss (an even smaller size) is more favourable than a net outcome consisting of just a smaller loss (price increasing or package downsizing) alone.</p>
<p>This effect is tied to the “loss-aversion theory” developed by psychologists Daniel Kahneman and Amos Tversky, which says people value losses and gains differently.</p>
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Read more:
<a href="https://theconversation.com/the-behavioural-economics-of-discounting-and-why-kogan-would-profit-from-discount-deception-117895">The behavioural economics of discounting, and why Kogan would profit from discount deception</a>
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<p>Second, price is more noticeable and is given more weight than size. Thus shoppers were influenced more by the price drop than by the reduction in package size. </p>
<p>We attribute this to an <a href="http://psychology.iresearchnet.com/social-psychology/social-cognition/automatic-processes/">automatic cognitive response</a> – people have inherent preference toward lower prices.</p>
<h2>Unit pricing is important, but not enough</h2>
<p>In most developed countries, consumer protection laws require retailers to display unit prices to enable shoppers to cut through the proliferation of marketing signals designed to attract attention. </p>
<figure class="align-center zoomable">
<a href="https://images.theconversation.com/files/459213/original/file-20220422-14-y21wt0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=1000&fit=clip"><img alt="'Price drop' shelf tickets in a supermarket" src="https://images.theconversation.com/files/459213/original/file-20220422-14-y21wt0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/459213/original/file-20220422-14-y21wt0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=450&fit=crop&dpr=1 600w, https://images.theconversation.com/files/459213/original/file-20220422-14-y21wt0.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=450&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/459213/original/file-20220422-14-y21wt0.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=450&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/459213/original/file-20220422-14-y21wt0.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=566&fit=crop&dpr=1 754w, https://images.theconversation.com/files/459213/original/file-20220422-14-y21wt0.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=566&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/459213/original/file-20220422-14-y21wt0.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=566&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px"></a>
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<span class="attribution"><span class="source">Shutterstock</span></span>
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<p>However, there’s no obligation to show the “before” unit price, so it’s difficult to gauge unit price changes.</p>
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Read more:
<a href="https://theconversation.com/archibald-argy-bargy-as-ben-quilty-wins-populist-prize-841">Archibald argy bargy as Ben Quilty wins populist prize</a>
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<p>It seems to be equally important for retailers to advertise unit price changes to help consumers make more informed purchases.</p>
<p>But our results confirm what marketers have clearly gleaned over the past decade. Consumers’ cognitive biases are strong. So you can expect ever more shrinkflation and for ever more “price drop”, “discount”, “new price” and “price match” tickets to adorn supermarket shelves.</p><img src="https://counter.theconversation.com/content/181326/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The authors do not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and have disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The sneaky strategy of reducing pack sizes shows the strength of consumers’ cognitive bias towards focusing on price, no matter what.Jun Yao, Senior Lecturer in Marketing, Macquarie UniversityDi Wang, Senior Lecturer in Marketing, Queensland University of TechnologyGary Mortimer, Professor of Marketing and Consumer Behaviour, Queensland University of TechnologyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1248972019-12-15T18:57:14Z2019-12-15T18:57:14ZMust end soon! But not too soon! The catch in time-limited sales tactics<figure><img src="https://images.theconversation.com/files/305802/original/file-20191209-90574-or10im.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Time-limited offers leverage risk-aversion. That is, the more you dislike risk, the more likely it is you will take the bait and buy now.</span> <span class="attribution"><span class="source">www.shutterstock.com</span></span></figcaption></figure><p>As Christmas shopping ramps up, you may be getting a lot of emails offering you attractive discounts for a short period only. You may see flash sales or special deals that exhort you to “buy now” to avoid missing out.</p>
<p>These digital “time-limited” offers, as they are called, are actually an old sales tactic. </p>
<p>Those in the game of selling cars, for example, have long used the trick of alluding to that other very interested buyer who’s likely to return and snap up the bargain that’s before you. Telephone salespeople routinely offer deals that must be accepted during the call. Want time to think about it? Too bad.</p>
<p>Online time-limited sales work on the same basis, but with technology taking it to a whole new level. Now retailers can bombard you with offers that are highly customised and super-short – a deal, perhaps, for something you might have been searching online for, and now available at a discount only until midnight.</p>
<p>But for these tactics to work, our research suggests, requires finding a Goldilocks zone between being too pushy and not all. Time needs to be limited to deter you from searching elsewhere for a better deal. But paradoxically you also need enough time to convince yourself that buying is the best decision.</p>
<h2>Experimenting with time limits</h2>
<p>To find out what makes time-limited offers effective, I and my colleagues Robert Sugden and Mengjie Wang from the University of East Anglia <a href="https://doi.org/10.1016/j.jebo.2019.09.008">ran experiments</a> to see what leads people to accept or reject such offers. </p>
<p>What we found is that these offers leverage risk-aversion. That is, the more you dislike risk, the more likely it is you will take the bait and buy now. </p>
<p>In our experiments, using university students, we asked participants to complete 30 “price search” tasks. These tasks involved giving participants a “budget” and asking them to buy a product from six different price offers, shown to them sequentially with a few seconds between each. Any unspent money they got to keep. </p>
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<img alt="" src="https://images.theconversation.com/files/306533/original/file-20191212-85404-gk1e26.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/306533/original/file-20191212-85404-gk1e26.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=400&fit=crop&dpr=1 600w, https://images.theconversation.com/files/306533/original/file-20191212-85404-gk1e26.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=400&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/306533/original/file-20191212-85404-gk1e26.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=400&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/306533/original/file-20191212-85404-gk1e26.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=503&fit=crop&dpr=1 754w, https://images.theconversation.com/files/306533/original/file-20191212-85404-gk1e26.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=503&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/306533/original/file-20191212-85404-gk1e26.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=503&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<span class="caption">Time-limited offers seek to deter you from searching elsewhere for a better deal.</span>
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<p>In half of the tasks they could consider all six offers before making their choice.
In the other half, one of the first three offers would be time-limited, lapsing after either four or 12 seconds, which they could only accept before the next offer appeared.</p>
<p>We also varied, when participants accepted a time-limited offer, between showing them no more offers or showing all remaining offers immediately. This was to test if greater feedback (increasing the possibility of regret) reduced the probability of a time-limited offer being chosen.</p>
<p>Participants then did 15 related risk-taking tasks based on their choices in the tasks with time-limited options. This helped us determine what was going on with their choices. </p>
<h2>A time paradox</h2>
<p>Overall our results point to choosing time-limited options being linked to risk aversion. People generally prefer to secure a certain cake now over the uncertain possibility of a better cake in the future. We really do believe the old proverb that a bird in the hand is worth two in the bush. </p>
<p>But there was a catch – and a big one. Somewhat paradoxically, people also need to think things through to jump on the time-limited offer. Time-limited offers were accepted more when participants had 12 seconds to decide rather than four seconds. </p>
<p>This indicates people need enough time to reflect on the task to decide they are better off going for the “safe” deal.</p>
<p>As we <a href="https://www.sciencedirect.com/science/article/pii/S0167268119302823?via%3Dihub#sec0008">warn in our paper</a>, one should be wary about extrapolating too directly from laboratory behaviour to real markets, but our results suggest time-limited offers do not rely on limits to the consumers’ ability to make a rational decision. When they work it is because they are mechanisms of search deterrence – restricting the consumers’ opportunities to compare available offers – amplified by risk aversion.</p>
<p>So businesses may be shooting themselves in the foot when they create offers that are too short, too pushy. If you’re like most people, you need time to reflect on the risk of not buying. If the offer is too fast and furious, you’re likely to just be turned off.</p><img src="https://counter.theconversation.com/content/124897/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>The research referred to in this blog was supported by the Economic and Social Research Council of the UK (awards no. ES/K002201/1 and ES/P008976/1); by the Centre for Behavioural and Experimental Social Science (CBESS) at the University of East Anglia (UEA); and by funding from the European Research Council (ERC) under the European Union's Horizon 2020 research and innovation programme, grant agreement no. 670103.</span></em></p>Technology has taken the old sales tactic of time-limited offer to a whole new level. But for the tactic to work requires a Goldilocks zone between being too pushy and not all.Daniel Zizzo, Professor and Academic Dean of the School of Economics, The University of QueenslandLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/1112592019-02-17T18:56:56Z2019-02-17T18:56:56ZThe decoy effect: how you are influenced to choose without really knowing it<figure><img src="https://images.theconversation.com/files/257627/original/file-20190207-174890-1btlu70.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The decoy effect is the phenomenon where consumers swap their preference between two options when presented with a third option.</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>Price is the <a href="https://www.forbes.com/sites/keithlevy/2011/11/30/price-marketings-most-delicate-p/#62a2a8ed397f">most delicate element</a> of the marketing mix, and much thought goes into setting prices to nudge us towards spending more. </p>
<p>There’s one particularly cunning type of pricing strategy that marketers use to get you to switch your choice from one option to a more expensive or profitable one. </p>
<p>It’s called the <a href="https://www.intelligenteconomist.com/decoy-effect/">decoy effect</a>.</p>
<p>Imagine you are shopping for a Nutribullet blender. You see two options. The cheaper one, at $89, promotes 900 watts of power and a five-piece accessory kit. The more expensive one, at $149, is 1,200 watts and has 12 accessories. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/259209/original/file-20190215-1745-1120dly.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/259209/original/file-20190215-1745-1120dly.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=447&fit=crop&dpr=1 600w, https://images.theconversation.com/files/259209/original/file-20190215-1745-1120dly.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=447&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/259209/original/file-20190215-1745-1120dly.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=447&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/259209/original/file-20190215-1745-1120dly.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=562&fit=crop&dpr=1 754w, https://images.theconversation.com/files/259209/original/file-20190215-1745-1120dly.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=562&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/259209/original/file-20190215-1745-1120dly.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=562&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<p>Which one you choose will depend on some assessment of their relative value for money. It’s not immediately apparent, though, that the more expensive option is better value. It’s slightly less than 35% more powerful but costs nearly 70% more. It does have more than twice as many plastic accessories, but what are they worth?</p>
<p>Now consider the two in light of a third option.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/259210/original/file-20190215-1751-jgbfa2.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/259210/original/file-20190215-1751-jgbfa2.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=295&fit=crop&dpr=1 600w, https://images.theconversation.com/files/259210/original/file-20190215-1751-jgbfa2.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=295&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/259210/original/file-20190215-1751-jgbfa2.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=295&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/259210/original/file-20190215-1751-jgbfa2.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=370&fit=crop&dpr=1 754w, https://images.theconversation.com/files/259210/original/file-20190215-1751-jgbfa2.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=370&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/259210/original/file-20190215-1751-jgbfa2.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=370&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<p>This one, for $125, offers 1,000 watts and nine accessories. It enables you to make what feels like a more considered comparison. For $36 more than the cheaper option, you get four more accessories and an extra 100 watts of power. But if you spend just $24 extra, you get a further three accessories and 200 watts more power. Bargain!</p>
<p>You have just experienced the decoy effect. </p>
<h2>Asymmetric dominance</h2>
<p>The decoy effect is defined as the phenomenon whereby consumers change their preference between two options when presented with a third option – the “decoy” – that is “asymmetrically dominated”. It is also referred to as the “attraction effect” or “asymmetric dominance effect”.</p>
<p>What asymmetric domination means is the decoy is priced to make one of the other options much more attractive. It is “dominated” in terms of perceived value (quantity, quality, extra features and so on). The decoy is not intended to sell, just to nudge consumers away from the “competitor” and towards the “target” – usually the more expensive or profitable option. </p>
<p>The effect was first described by academics Joel Huber, John Payne and Christopher Puto <a href="https://apps.dtic.mil/dtic/tr/fulltext/u2/a101132.pdf">in a paper</a> presented to a conference in 1981 (and later published in the <a href="http://dx.doi.org/10.1086/208899">Journal of Consumer Research</a> in 1982). </p>
<p>They demonstrated the effect through experiments in which participants (university students) were asked to makes choices in scenarios involving beer, cars, restaurants, lottery tickets, films and television sets. </p>
<p>In each product scenario participants first had to choose between two options. Then they were given a third option – a decoy designed to nudge them toward picking the target over the competitor. In every case except the lottery tickets the decoy successfully increased the probability of the target being chosen. </p>
<p>These findings were, in marketing terms, revolutionary. They challenged established doctrines – known as the “<a href="https://www.researchgate.net/publication/227712025_The_Similarity_Heuristic">similarity heuristic</a>” and the “<a href="https://www.researchgate.net/publication/317954913_Assortment_Optimization_under_the_General_Luce_Model">regularity condition</a>” – that a new product will take away market share from an existing product and cannot increase the probability of a customer choosing the original product. </p>
<h2>How decoys work</h2>
<p>When consumers are faced with many alternatives, they often experience choice overload – what psychologist Barry Schwartz has termed the <a href="https://www.scientificamerican.com/article/the-tyranny-of-choice/">tyranny</a> or <a href="https://psmag.com/social-justice/paradox-choice-barry-schwartz-psychology-10-years-later-96706">paradox of choice</a>. Multiple behavioural experiments <a href="https://www.sciencedirect.com/science/article/abs/pii/S1057740814000916">have consistently demonstrated</a> that greater choice complexity increases anxiety and hinders decision-making. </p>
<p>In an attempt to reduce this anxiety, consumers tend to simplify the process by selecting only a couple of criteria (say price and quantity) to determine the best value for money. </p>
<p>Through manipulating these key choice attributes, a decoy steers you in a particular direction while giving you the feeling you are making a rational, informed choice. </p>
<p>The decoy effect is thus a form of “<a href="https://www.behavioraleconomics.com/resources/mini-encyclopedia-of-be/nudge/">nudging</a>” – defined by Richard Thaler and Cass Sunstein (the pioneers of nudge theory) as “any aspect of the choice architecture that alters people’s behaviour in a predictable way without forbidding any options”. Not all nudging is manipulative, and some argue that even manipulative nudging can be <a href="https://blogs.lse.ac.uk/politicsandpolicy/nudges-manipulate-except-when-they-dont/">justified if the ends are noble</a>. It has proven useful in social marketing to encourage people <a href="https://www.researchgate.net/publication/319023957_Nudging_and_Boosting_Steering_or_Empowering_Good_Decisions">to make good decisions</a> such as using less energy, eating healthier or becoming organ donors. </p>
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<em>
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Read more:
<a href="https://theconversation.com/nudging-people-towards-changing-behaviour-what-works-and-why-not-27576">'Nudging' people towards changing behaviour: what works and why (not)?</a>
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<h2>In the market</h2>
<p>We see decoy pricing in many areas. </p>
<p>A decade ago behavioural economist <a href="http://danariely.com/">Dan Ariely</a> spoke about his fascination with the pricing structure of <a href="https://www.economist.com/democracy-in-america/2009/05/22/the-importance-of-irrelevant-alternatives">The Economist</a> and how he tested the options on 100 of his students.</p>
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<p>In one scenario the students had a choice of a web-only subscription or a print-only subscription for twice the price; 68% chose the cheaper web-only option.</p>
<p>They were given a third option – a web-and-print subscription for the same price as the print-only option. Now just 16% chose the cheaper option, with 84% opting for the obviously better combined option. </p>
<p>In this second scenario the print-only option had become the decoy and the combined option the target. Even The Economist was intrigued by Ariely’s finding, publishing a story about it entitled “<a href="https://www.economist.com/democracy-in-america/2009/05/22/the-importance-of-irrelevant-alternatives">The importance of irrelevant alternatives</a>”.</p>
<p>Subscription pricing for <a href="https://www.theaustralian.com.au/">The Australian</a> today replicates this “irrelevant alternative”, though in a slightly different way to the pricing architecture Ariely examined.</p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/259378/original/file-20190217-56215-12lo0e8.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/259378/original/file-20190217-56215-12lo0e8.png?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=580&fit=crop&dpr=1 600w, https://images.theconversation.com/files/259378/original/file-20190217-56215-12lo0e8.png?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=580&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/259378/original/file-20190217-56215-12lo0e8.png?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=580&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/259378/original/file-20190217-56215-12lo0e8.png?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=729&fit=crop&dpr=1 754w, https://images.theconversation.com/files/259378/original/file-20190217-56215-12lo0e8.png?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=729&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/259378/original/file-20190217-56215-12lo0e8.png?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=729&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
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<p>Why would you choose the digital-only subscription when you can get the weekend paper delivered for no extra cost? </p>
<p>In this instance, the digital-only option is the decoy and the digital+weekend paper option is the target. The intention appears to be to discourage you from choosing the more expensive six-day paper option. Because that option is not necessarily more profitable for the company. What traditionally made print editions profitable, despite the cost of printing and distribution, was the advertising they carried. That’s <a href="https://home.kpmg/content/dam/kpmg/co/pdf/co-17-01-08-tmt-stop-the-presses.pdf">no longer the case</a>. It makes sense to encourage subscribers to move online.</p>
<p>Not all decoys are so conspicuous. In fact the decoy effect may be extremely effective by being quite subtle.</p>
<p>Consider the <a href="https://www.aussieprices.com.au/food/boost-juice-menu-prices/">price of drinks</a> at a well-known juice bar: a small (350 ml) size costs $6.10; the medium (450 ml) $7.10; and the large (610 ml) $7.50. </p>
<p>Which would you buy?</p>
<p>If you’re good at doing maths in your head, or committed enough to use a calculator, you might work out that the medium is slightly better value than the small, and the large better value again. </p>
<p>But the pricing of the medium option – $1 more than the small but just 40 cents cheaper than the large – is designed to be asymmetrically dominated, steering you to see the biggest drink as the best value for money. </p>
<p>So have you just made the sensible choice, or been manipulated to spend more on a drink larger than you needed?</p><img src="https://counter.theconversation.com/content/111259/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Gary Mortimer does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Most pricing structures nudge us to spend more. But there’s a particularly cunning type of pricing that can get us to swap our preference from a cheaper to a more expensive option.Gary Mortimer, Associate Professor in Marketing and Consumer Behaviour, Queensland University of TechnologyLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/783952017-07-03T04:26:20Z2017-07-03T04:26:20ZWho’s paying for lunch? Here’s exactly how drug companies wine and dine our doctors<figure><img src="https://images.theconversation.com/files/173735/original/file-20170614-21325-1uxqo3v.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">Now you can find out who's wining and dining our doctors, nurses and pharmacists with publicly available data of drug company funded events.</span> <span class="attribution"><a class="source" href="https://www.shutterstock.com/download/confirm/571821898?src=TmrktekrTjHO6OM4a6e84g-1-19&size=medium_jpg">from www.shutterstock.com</a></span></figcaption></figure><p>In June 2015, 24 Australian cancer specialists flew to Chicago to attend a five-day conference. Drug giant Amgen funded the trip, including registration, transfers and wining and dining. It cost almost A$270,000. </p>
<p>In December 2013, in a teaching hospital in New South Wales, 11 pharmacists and pharmacy technicians attended a 45-minute presentation by a pharmaceutical representative from a company called Menarini. The presentation was accompanied by a lunch that included sandwiches, wraps, sushi and fruit juice. Lunch cost A$200.</p>
<p>These are just two very different examples of the more than 116,000 events for Australian health professionals that drug companies funded in a recent four-year period, which we analysed in a study just published in <a href="http://bmjopen.bmj.com/content/7/6/e016701">BMJ Open</a>. </p>
<p>You can examine the <a href="https://researchdata.ands.org.au/pharmaceutical-industry-funded-sept-2015/941218">data</a> yourself.</p>
<p>Since 2007, drug companies <a href="https://www.accc.gov.au/media-release/australian-competition-tribunal-affirms-acccs-decision-on-extra-reporting-for?pageDefinitionItemId=16940">have been required</a> to publish detailed reports of how they sponsor educational events for health professionals. </p>
<p>They have had to list the number of attendees, the name of the restaurant, resort or clinic, and the costs of food and drink. But so far, they have not had to list the names of the doctors enjoying it. </p>
<p>Until today there has been little analysis of these reports. This is because despite being publicly available, the millions of bits of data were “trapped” in PDF files. Now the information is available for anyone to analyse.</p>
<h2>What did we find?</h2>
<p>The data shows the routine, yet influential, ways health professionals interact with pharmaceutical companies when it comes to professional education.</p>
<p>Between 2011 and 2015, pharmaceutical companies sponsored more than 116,000 events - on average more than 600 a week. While many of the breakfasts, lunches and dinners were held in hotels and fancy restaurants across the country, most took place inside hospitals or doctors’ offices, suggesting drug companies have a pervasive presence in everyday clinical practice.</p>
<p>Most of the events (82%) included medical doctors, but many included different types of health professionals. For example, 39.6% included nurses, 38.3% trainees and 8.4% pharmacists. </p>
<p>Oncology or cancer – a field where there is increasing concern about the use of high-cost medicines – was the most frequent area of focus of the events, accounting for 19.7% of the functions.</p>
<h2>Why does this matter?</h2>
<p>Industry sponsored events for health professionals are commonly termed “educational” events. However, they are a <a href="http://annals.org/aim/article/727539/narrative-review-promotion-gabapentin-analysis-internal-industry-documents">key pillar</a> of the pharmaceutical industry’s marketing strategy. </p>
<p>Although health professionals often <a href="https://www.ncbi.nlm.nih.gov/pmc/articles/PMC2801075/">fail to perceive commercial biases</a> in such events, their educational content <a href="http://jme.bmj.com/content/41/10/859.long">can be biased</a> in favour of the sponsor. The prescription rate of the sponsor’s drug <a href="http://jamanetwork.com/journals/jamainternalmedicine/fullarticle/2520680">has also been shown to increase</a> afterwards.</p>
<p>Even the provision of free meals, which are commonly provided at sponsored events, can influence clinical practice. Evidence of this comes from the United States, where thanks to the <a href="https://www.congress.gov/bill/111th-congress/senate-bill/301">Sunshine Act</a>, pharmaceutical companies have to report all payments to individual doctors.</p>
<p>Prescribing drugs based on exposure to industry-sponsored events <a href="https://theconversation.com/drug-companies-are-buying-doctors-for-as-little-as-a-16-meal-61364">raises concerns</a> about the unhealthy effects on patient care and increasing health care costs when newer, expensive and aggressively promoted drugs are prescribed.</p>
<p>A recent <a href="http://jamanetwork.com/journals/jamainternalmedicine/fullarticle/2528290">study</a> conducted in the US found the receipt of even a single sponsored meal worth as little as US$16 was associated with an increase in prescribing of promoted drugs. </p>
<h2>Disappearing data</h2>
<p>The analysis published today is timely considering two <a href="https://medicinesaustralia.com.au/wp-content/uploads/sites/52/2010/01/20150617-PUB-Code-Edition-18-FINAL.pdf">major changes</a> to drug company reporting that have recently been implemented in Australia. </p>
<p>From October 2015, drug companies have no longer had to report on these influential “educational” events. Instead, they are now required to report on payments they make to individual health professionals, and to name those individuals. </p>
<p>This could improve transparency in some ways. For instance, people could check if their own doctor has attended an educational event sponsored by a drug company. But the new rules contain loopholes.</p>
<p>For example, they explicitly exclude the need for drug companies to report how much they spend on food and beverages. As 90% of the events analysed included the provision of food and beverage, a large proportion of potentially influential payments from drug companies to health professionals are now invisible.</p>
<h2>The value of transparency and independence</h2>
<p><a href="https://www.cmu.edu/dietrich/sds/docs/loewenstein/PitfallsdisclosingCOI.pdf">As some authors have pointed out</a>, transparency is not going to solve the problem of unhealthy industry influence as it does not eliminate the conflicts of interest that arise when health professionals interact with pharmaceutical companies. </p>
<p>The most important issue is not just transparency, but if it is appropriate for health professionals to receive meals from and rely on information provided by drug companies in the first place.</p>
<p><a href="https://www.ncbi.nlm.nih.gov/books/NBK22942/">Evidence</a> suggests that it is time to forge much greater independence between the companies marketing the drugs, and the doctors prescribing them.</p>
<p>Policies to limit health professionals’ interactions with pharmaceutical companies can be a more effective measure than disclosure to reduce and eliminate unhealthy commercial influence on clinical practice and professional education. </p>
<p>For example, some medical institutions in the US <a href="http://amsascorecard.org">have limited interactions</a> between their students and doctors and the pharmaceutical industry, banning gifts and free food by manufacturers and regulating pharmaceutical representatives visits to physicians. These policies <a href="http://jamanetwork.com/journals/jama/article-abstract/2623607">have been associated </a> with changes in prescribing behaviours.</p>
<p>Another example of a policy to provide greater independence comes from the Australian Medical Students Association, which has a <a href="https://www.amsa.org.au/sites/amsa.org.au/files/Pharmaceutical%20Sponsorship%20%282014%29.pdf">strict ban</a> on accepting drug company funding for its conferences - unlike most doctors groups which accept it.</p>
<p>However, notwithstanding the limits of disclosure, there are still enormous opportunities for designing effective and inclusive transparency policies. </p>
<p>Ten years ago, Australia introduced a world-first scheme to disclose every single drug company-funded event for doctors. Since then the US Sunshine Act created a new international benchmark, revealing all payments and naming the doctors who receive them.</p>
<p>Today it seems that Australia has dropped the ball, with moves towards individual disclosure overshadowed by abandoning transparency around routine wining and dining, and is slipping backwards into the darkness of secrecy.</p><img src="https://counter.theconversation.com/content/78395/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Alice Fabbri receives a PhD scholarship from the University of Insubria (Varese, Italy).</span></em></p><p class="fine-print"><em><span>Lisa Bero receives funding from The University of Sydney for a program in Pharmaceutical Policy. She is Co-chair of the Governing Board of Cochrane.</span></em></p><p class="fine-print"><em><span>Dr Ray Moynihan is a National Health and Medical Research Council Early Career Fellow. </span></em></p>Drug companies funded more than 116,000 educational events for doctors over four years. Now you can find out exactly which companies footed the bills and how much they paid.Alice Fabbri, PhD student, University of SydneyLisa Bero, Chair professor, University of SydneyRay Moynihan, Senior Research Fellow, Bond UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/802212017-06-29T12:54:52Z2017-06-29T12:54:52ZDon’t believe the hype: sexually-charged advertising is not the best way to push a product<figure><img src="https://images.theconversation.com/files/176227/original/file-20170629-16053-1gsk88n.jpg?ixlib=rb-1.1.0&rect=148%2C0%2C2505%2C1360&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">The infamous 1994 Wonderbra advert featuring Czech model Eva Herzigova.</span> <span class="attribution"><span class="source">TBWA/Wonderbra</span></span></figcaption></figure><p>Over the decades, people have been taken on a sexual liberation tour that has challenged sexual norms. During the 1970s and 1980s, pop bands such as Queen tantalised audiences by singing “I am like a sex machine ready to reload/ Like an atom bomb about to oh oh oh oh oh explode,” and manufacturers of everything from cars to cigarettes featured pretty women in their advertising, hoping to boost sales. More recently, we have seen Marks & Spencer create saucy adverts for its food, a style dubbed “<a href="http://metro.co.uk/2014/09/03/marks-spencer-is-bringing-back-its-food-porn-ads-and-we-want-to-eat-all-of-it-4855111/#ixzz4lCUpaBfn">food porn</a>”. It would be easy to think that sex is the key to selling almost anything. </p>
<p>In the past, it has been claimed that sexually-laden advertisements grab consumers’ attention, enhance memory of the brand, establish positive attitudes, and increase the likelihood of purchase. But sexually-themed adverts don’t attract as much attention as they used to – indeed, it’s been a while since we’ve heard of <a href="http://www.huffingtonpost.co.uk/2011/03/31/hello-boys-billboard-voted-most-iconic-advert-image-of-all-time_n_7410644.html">drivers becoming distracted by roadside billboards of women in underwear</a>. So does sex still sell? According to a recent study, it appears not.</p>
<p>Published in the International Journal of Advertising, a new analysis that compared the results of <a href="http://www.tandfonline.com/doi/full/10.1080/02650487.2017.1334996">78 research studies between 1969 and 2017</a> found that while people remember adverts with sexual appeal more than those without, the enhanced recollection does not extend to the product or brand that advert is selling. Not only that, but the sexual ads can have a negative impact on how a brand is perceived. While, overall, men view sexual imagery in advertising more favourably, and women view it more negatively, in neither case is there any evidence that the ads generate a greater chance of purchasing the product. </p>
<h2>Conditioned to react</h2>
<p>Some of the past success of using sexual imagery in advertising has been attributed to what psychologists call “classical conditioning”, a method that can, if used correctly, enhance attention and memory. Classical conditioning happens when the sexual arousal prompted by the advert is subconsciously transferred to the product or brand, leading to a feeling of arousal when exposed again to the product or brand, generating a “feel-good effect” for the product. </p>
<p>The problem is that if people are continuously faced with a large volume of sexual imagery, they eventually <a href="http://www.apa.org/pubs/journals/releases/bul-bul0000018.pdf">become desensitised</a> to it and so no longer experience physiological arousal. This is what has happened as a barrage of sexually-charged advertisements have become a permanent feature of the advertising landscape. What started out as something novel – in step with the sexual liberation of the 1960s and 1970s – has now turned into something mundane and everyday, even frowned upon. </p>
<figure class="align-center ">
<img alt="" src="https://images.theconversation.com/files/176218/original/file-20170629-16051-1vlax1t.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&fit=clip" srcset="https://images.theconversation.com/files/176218/original/file-20170629-16051-1vlax1t.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=600&h=462&fit=crop&dpr=1 600w, https://images.theconversation.com/files/176218/original/file-20170629-16051-1vlax1t.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=600&h=462&fit=crop&dpr=2 1200w, https://images.theconversation.com/files/176218/original/file-20170629-16051-1vlax1t.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=600&h=462&fit=crop&dpr=3 1800w, https://images.theconversation.com/files/176218/original/file-20170629-16051-1vlax1t.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=754&h=580&fit=crop&dpr=1 754w, https://images.theconversation.com/files/176218/original/file-20170629-16051-1vlax1t.jpg?ixlib=rb-1.1.0&q=30&auto=format&w=754&h=580&fit=crop&dpr=2 1508w, https://images.theconversation.com/files/176218/original/file-20170629-16051-1vlax1t.jpg?ixlib=rb-1.1.0&q=15&auto=format&w=754&h=580&fit=crop&dpr=3 2262w" sizes="(min-width: 1466px) 754px, (max-width: 599px) 100vw, (min-width: 600px) 600px, 237px">
<figcaption>
<span class="caption">A scantily clad Pamela Anderson in an advert for Peta.</span>
<span class="attribution"><span class="source">Peta</span></span>
</figcaption>
</figure>
<p>This is particularly true for charitable advertising. Numerous female celebrities have stripped for charities such as PETA, but it has been found that using <a href="http://journals.plos.org/plosone/article?id=10.1371/journal.pone.0083311">sexualised imagery can be seen as dehumanising to women</a>, leading to a subsequent decrease in support for the brands or companies in question. Interestingly, both men and women adopt negative views of ethical causes “exploiting” women in this way, as the audience ends up questioning the integrity of a charity which would seemingly benefit from taking advantage of women.</p>
<h2>Seen it all before</h2>
<p>As we now live in a world where sexual imagery can be found easily online, scantily-clad men and women in advertising are not going to capture the attention and generate the arousal they once did. Society has changed, and so has advertising. Overtly explicit sex adverts are no longer deemed fashionable. Consumers want advertising that feels up-to-date. There has been a big political shift that is altering peoples’ interest and focus, and a big part of this is the recent political upheaval in the US. </p>
<p>To capture consumers’ attention something less frivolous is needed, as people feel a need to right the wrongs in the world. Racism, sexism, and environmentally friendly products are examples of topics that consumers now zoom in on. For example, <a href="https://www.youtube.com/watch?v=GkyxpuSd5u4">Kenco coffee</a> has cleverly tapped into the newfound consumer interest in social politics, with adverts that suggest that drinking their coffee will rescue young men in Honduras from becoming gang members. This allows people to feel socially active while still indulging in consumerism. There are many examples of products and brands that are willing to use <a href="http://uk.businessinsider.com/5-brands-political-oscars-ads-ny-times-cadillac-ge-hyatt-audible-2017-2?r=US&IR=T">politically-based messages</a> to further their image.</p>
<p>Consumers also want “experiences” as their expectations of what a product should do have increased considerably through the years. Of course, this is difficult to deliver through traditional advertising. This is why we have seen a shift in marketing towards more “hands on” communication, using <a href="https://www.marketingweek.com/2016/01/18/top-sensory-marketing-trends-for-2016/">in-store virtual reality, or smell and taste to evoke memories</a>, as it is often more persuasive. </p>
<p>And with these shifts in audiences’ expectations, the sexually-based advertisements are on their way out. Sex is unlikely to ever go away, of course, but it is much less likely to be featured in mass media messaging once it no longer gels with the modern consumer.</p><img src="https://counter.theconversation.com/content/80221/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Cathrine Jansson-Boyd does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>The old adage that ‘sex sells’ is past its sell-by date, as consumers now sport a more socially-conscious mindset.Cathrine Jansson-Boyd, Reader in Consumer Psychology, Anglia Ruskin UniversityLicensed as Creative Commons – attribution, no derivatives.tag:theconversation.com,2011:article/643972016-08-28T18:07:59Z2016-08-28T18:07:59ZChildren must be protected from robust marketing if they’re going to eat well<figure><img src="https://images.theconversation.com/files/135518/original/image-20160825-6618-1dsubhd.jpg?ixlib=rb-1.1.0&q=45&auto=format&w=496&fit=clip" /><figcaption><span class="caption">
</span> <span class="attribution"><span class="source">Shutterstock</span></span></figcaption></figure><p>For the sake of future generations, it is critical that we teach our children to eat well: lots of fruit and vegetables, less salt, less sugar and fewer processed carbohydrates. </p>
<p>This sounds simple. But the context in which such education needs to take place is one of multiple conflicts of interest. </p>
<p>Children need to be protected from marketing efforts. At the same time parents need to – with support – exercise authority, monitor their children’s eating patterns and ensure a balanced diet that has less processed and sugar filled food. </p>
<p>This protection and support is vital to prevent illness. It will save unnecessary spending on health care, but also ensure that populations are healthy to enable <a href="https://ideas.repec.org/p/zbw/ifwedp/200940.html">maximum contribution</a> <a href="http://www.who.int/hdp/atmgh13.pdf?ua=1">to development</a>.</p>
<h2>Children are vulnerable</h2>
<p>There are three main reasons that companies and brands direct their marketing at children.</p>
<p>The first is the “pester power” that children have. They are encouraged to buy various brands of food – usually processed and high in sugar – by nagging their parents. Numerous marketing ploys are built around this, especially the free toys and collectable items that accompany branded products. In a <a href="http://www.roymorgan.com/findings/6698-pester-power-purchasing-decisions-201602292247">survey in Australia</a> more than 40% of purchases related to breakfast cereals and other foods were decided by children.</p>
<p>The second is that children themselves often have some income and can easily purchase these foods for themselves as they are cheaper and seem more appetising and tasty than healthier alternatives.</p>
<p>The third is the long term loyalty children will have to a brand that they come to know and love. They are bound to buy it in the future for themselves and their children and this affects their lifelong eating patterns.</p>
<p>The food that is advertised is not fruit and vegetables, which have been shown internationally to save lives. Nor is it food that is non-processed or healthy. Children are exposed to food that is high in sugar and crave this far more than they do healthy food.</p>
<p>According to the <a href="http://www.commercialfreechildhood.org/resource/marketing-children-overview">campaign for a commercial-free childhood</a>, marketing exploits children’s developmental vulnerabilities. </p>
<p>Their research shows that <a href="http://www.commercialfreechildhood.org/resource/marketing-children-overview">very young children</a> can’t distinguish between commercials and programme content. Even older children sometimes fail to recognise product placement as advertising. Until the age of eight, children do not understand <a href="http://www.commercialfreechildhood.org/resource/marketing-children-overview">advertising’s persuasive</a> intent.</p>
<p>They have also found that marketers often <a href="http://www.commercialfreechildhood.org/resource/marketing-children-overview">denigrate adults</a> and exploit older children’s desires to fit in with their peers and rebel against authority figures as a selling point for their products.</p>
<h2>Why does this matter</h2>
<p>The rise of non-communicable diseases – particularly diabetes, hypertension and cardiovascular diseases – has highlighted how important it is to intervene against this marketing.</p>
<p>Cardiovascular disease is strongly linked to high blood pressure, obesity and a lack of exercise. Prevention is critical to controlling obesity as well as diabetes and cardiovascular disease.</p>
<p>In the developing world, these chronic diseases have been <a href="http://www.hsrc.ac.za/en/research-outputs/view/6493">skyrocketing</a> and interventions have become more urgent. The challenge is that such countries now face a <a href="http://www.hsrc.ac.za/uploads/pageContent/3893/NCDs%20STRAT%20PLAN%20%20CONTENT%208%20april%20proof.pdf">double burden</a> of both HIV and non-communicable diseases.</p>
<p>South Africa is doing particularly poorly in treating chronic diseases. Prevalence, awareness, treatment and the control of high blood pressure are all problem areas. Fewer than 10% of people identified as suffering from high blood pressure have it under <a href="http://www.hsrc.ac.za/en/media-briefs/population-health/results-sanhanes1">control</a>. </p>
<p>And in the last 10 years, the number of <a href="http://www.hsrc.ac.za/en/media-briefs/population-health/results-sanhanes1">overweight children</a> has increased, from 10.6% to 18.2%. Obesity sits at <a href="http://www.hsrc.ac.za/en/media-briefs/population-health/results-sanhanes1">4.7%</a>.</p>
<p>South Africa cannot afford to allow food companies to advertise to children if it’s serious about curbing childhood obesity and the lifestyle disease epidemic among the general population. If such marketing and advertising isn’t tackled, the country will sit with a situation in which future generations will be obese; will have increasing levels of hypertension and diabetes and will struggle more with heart disease.</p>
<h2>Aggressive campaigns</h2>
<p>Many countries have voluntary codes that the food industry is supposed to follow, such as not advertising when more than 30% of the audience is children. This is often not successful.</p>
<p>In the US, the food and beverage industry <a href="http://www.ftc.gov/os/2008/07/P064504foodmktingreport.pdf">spends</a> about US $2 billion per year marketing to children. The fast food industry <a href="http://www.ftc.gov/os/2008/07/P064504foodmktingreport.pdf">spends</a> more than US $5 million every day marketing unhealthy foods to children.</p>
<p>Research shows that children <a href="http://www.rwjf.org/childhoodobesity/product.jsp?id=72665">watch</a> an average of more than ten food-related ads every day. This amounts to nearly 4,000 adverts a year. About 98% of these <a href="http://www.rwjf.org/en/library/research/2011/08/trends-in-the-nutritional-content-of-television-food-advertiseme.html">food advertisements</a> are for products that are high in fat, sugar or sodium and around 79% percent are low in fibre.</p>
<p>The evidence also notes that children who identify with brands become more obese. And those exposed to advertising become obese even when viewing time and eating in front of the TV is controlled. </p>
<p>This is not just a phenomenon in the USA. A <a href="https://www.cdc.gov/pcd/issues/2015/14_0559.htm">study in Soweto</a>, one of Africa’s largest urban settlements, showed that advertisements of sugar sweetened beverages were relatively close to schools and that half the schools in the area had branded advertising of these beverages on their properties.</p>
<p>These campaigns run despite South Africa’s <a href="https://www.ifballiance.org/sites/default/files/South_african_marketing_to_children_pledge.pdf">voluntary marketing pledge</a> under which the food and beverage industry has promised not to advertise unhealthy products to children under the age of 12. </p>
<p>Children sporting events have also been targeted by <a href="http://www.sport24.co.za/cricket/bakers-to-quit-sa-cricket-20100317">sweet biscuit</a> producers and <a href="http://www.kfcminicricket.co.za/">fast food chains</a>. </p>
<h2>Turning the tide</h2>
<p>Often parents don’t know the high sugar, salt and fat content of foods. Many products such as have a lot of sugar but parents regard as healthy. But the reality is that children’s diets directly affects their risk of diabetes, and it also impacts on their levels of obesity. </p>
<p>As with all other complex issues, banning advertising to children in only one part of the equation. </p>
<p>Other interventions include better food labelling, increased access to safe exercise facilities, increased education about what healthy eating means and finally, making sure that the most unhealthy foods, such as sugar sweetened beverages are taxed so that they cost more than the healthy foods.</p><img src="https://counter.theconversation.com/content/64397/count.gif" alt="The Conversation" width="1" height="1" />
<p class="fine-print"><em><span>Susan Goldstein does not work for, consult, own shares in or receive funding from any company or organisation that would benefit from this article, and has disclosed no relevant affiliations beyond their academic appointment.</span></em></p>Marketers take advantage of the fact that children sometimes can’t recognise the difference between product placement and advertising.Susan Goldstein, Honorary Senior Lecturer at the School of Public Health, University of the WitwatersrandLicensed as Creative Commons – attribution, no derivatives.