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Does it really matter?! : categorization of radically aesthetic innovative products : using the superordinate label 'design'

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24-06-2016, Amsterdam

CATEGORIZATION OF RADICALLY AESTHETIC

INNOVATIVE PRODUCTS: USING THE SUPERORDINATE

LABEL ‘DESIGN’

Evelien Helder (10872361) Supervisor: dhr. dr. B. Kuijken Second reader: Ms I. Rozentale MSc

Master Thesis:

MSc. in Business Administration - Entrepreneurship and Management in the Creative Industries Track

University of Amsterdam

Abstract

Aesthetic innovation in a products’ visual appearance is increasingly gaining recognition as a realistic means for firms to improve their sustainable competitive advantage. Though, when an aesthetic innovation is too radical, consumers may not be able to affix the subordinate category label with certainty as the visual appearance deviates too strongly from the overall product archetype, resulting in negative product evaluations. Moving beyond the subordinate category level, this research examines the role of the superordinate category label, in particular the ‘design’ label, in the context of a radically aesthetic innovation. From this perspective, the superordinate category label design might trigger a more abstract representation as it can include diverse exemplars and comprehends particular concepts, which might reconcile with the visual appearance of a radically aesthetic innovation and may therefore function as a better vehicle to understand and accept these kinds of products.

By conducting an experiment (n = 264), using four different advertisements for a radically aesthetic innovative product, it is investigated how the superordinate category label design affects consumers’ product categorization certainty, willingness to pay, perceived incongruity and aesthetic pleasure and whether this is moderated by consumers’ design acumen. Contrary to expectations, the results in this study do not rely upon arbitrary significance thresholds to support the hypotheses. Specifically, inconsistent with previous research on category labels, participants in this study are not affected by either the subordinate category label or superordinate category label design or both when confronted with a radically aesthetic innovative product. Thus, the results signify that the superordinate category label design is just not that important in the context of radically aesthetic innovative product in consumer markets. Despite the lack of significance results, this research raises a couple of intriguing questions, both managerial and theoretical in nature, which provides worthwhile opportunities for future research.

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

Table of Contents

1.INTRODUCTION ... 3

2.THEORY ... 6

2.1 Radically aesthetic innovation ... 6

2.2 Product appearance and categorization ... 9

2.3 Radically aesthetic innovation and categorization certainty ... 10

2.4 Category labels and evaluation ... 12

2.5 Superordinate category label and categorization ... 14

2.5.1 Superordinate category label: design ... 15

2.6 Aesthetic pleasure and visual appearance ... 17

2.6.1 Design label: aesthetic pleasure and willingness to pay ... 18

2.7 Consumers’ design acumen ... 19

3.METHODOLOGY ... 21 3.1 Product class ... 21 3.2 Experimental design ... 23 3.3 Dependent measures ... 25 3.4 Moderating measure ... 26 4.RESULTS ... 27 4.1 Descriptive statistics ... 27 4.2 Hypothesis testing ... 29 5.GENERALDISCUSSION ... 40

5.1 Limitations and future research ... 42

5.2 Managerial implications ... 44 5.3 Conclusion ... 45 ACKNOWLEDGEMENTS ... 47 REFERENCES ... 48 APPENDIXA. ... 54 APPENDIXB. ... 55 APPENDIXC. ... 56

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

1. INTRODUCTION

There is an increasing recognition that in today’s highly crowded marketplace differentiation based on a products’ technical element alone is not adequate to ensure sustainable competitive advantage (Candi, 2006; Gemser and Leenders, 2001; Hertenstein, Platt and Veryzer, 2005; Kotler and Rath, 1984; Radford and Bloch, 2011; Roy and Riedel, 1997; Trueman and Jobber, 1998; Yamamoto and Lambert, 1994). In this sense, a radically aesthetic innovation in a firms’ product design, that is, its visual appearance, may provide realistic means to ‘stand out from its competitor’ (Bloch, Brunel and Arnold, 2003; Eisenman, 2013; Perks, Cooper and Jones, 2005; Talke, Salomo, Wieringa and Lutz, 2009). Firms as Alessi, Apple, Dyson and Philips follow such radically aesthetic design-driven innovation approach whereby their products’ visual appearance is used as one of the main features for differentiation in the market (Verganti, 2008).

However there are two sides to every coin, this strong deviation in the visual appearance may result in the fact that consumers find it challenging or even impossible to determine the products’ category membership (Goode, Dahl and Moreau, 2013; Jhang, Grant and Campbell, 2012; Moreau, Markman and Lehmann, 2001) and might therefore result in the product being rejected (Alexander, Lynch and Wang, 2008; Campbell and Goodstein 2001; Noseworthy and Trudel, 2011; Rindova and Petkova, 2007). To resolve this difficulty in consumers’ categorization efforts, firms can provide category labels (Goode et al., 2013; Gregan-Paxton, Hoeffler and Min Zhao, 2005; Mogilner, Rudnick, and Iyengar, 2008; Moreau et al., 2001; Yamauchi and Markman, 2000). Though, if consumers are not able to affix the subordinate category label to a new product with certainty, as can happen with a radically aesthetic innovative product design, it will still suffer negativeproductevaluations(Goode et al., 2013).

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

Moving beyond the subordinate category level, in order to stimulate and guide consumers better in their categorization efforts, applying the superordinate category label design may trigger a more overall abstract meaning as it can capture different types of relatedness that might occur between a radically aesthetic innovation and the design label (Murphy and Medin, 1985; Rosch, Mervis, Gray, Johnson and Boyes-Braem, 1976). Specifically, linguistically the word design comprehends particular concepts (Coles, Nelson, Hamilton, Greenberg, Potter, Rand, and Scanlan, 2007; Flusser and Cullars, 1995; Lawson, 1983) that may reconcile with the visual appearance of a radically aesthetic innovation and might thereby be perceived as a better vehicle to understand and accept these kinds of products. As words can differ in their meaningfulness and pleasantness (Goldberg, 1986), the superordinate category label design might also be seen as a meansto add value in terms of a higher aesthetic pleasure and willingness to pay (Goldberg, 1986; Kotler and Rath, 1984).

Differently from traditional design literature, in which design is classified in typologies and follows the view of the multiple facets of one process (Walsh, 1996), this present study moves to a more different and in-depth conceptualization. In this paper design is associated with end products that tend to look significantly different from the overall product archetype in terms of their visual appearance.

While there is research that has examined the effect of providing the category label (Yamauchi and Markman, 2000) in case of really new products (Moreau et al., 2001) novel products (Gregan-Paxton et al., 2005) and innovative aesthetic products (Goode et al., 2013), the focus of these studies is limited on the human concepts of categorization. More specifically, there are no studies that explicitly examine the effect of the superordinate category label in the case of products that cannot be easily categorized as they embody radical visual deviations. This paper will provide a refined

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

view on the superordinate category label design and empirically tests how this label affects consumers’ categorization and evaluation of a radically aesthetic innovation.

By conducting an experiment, using four different advertisements for a radically aesthetic innovative product, this study does not provide evidence that the usage of either subordinate category label or superordinate category label design or both is enacted as a proactive labelling strategy. Participants who experienced the superordinate category label design did no show any improved results in their categorization efforts and evaluation of a radically aesthetic innovative product than participants who did not experienced this superordinate category label. These results do not therefore align with the findings of Gregan-Paxton et al. (2005) who empirically shows that a lower level of product familiarity with the perceptual cue (i.e. products’ visual appearance) is associated with a higher impact level of the conceptually cue, such as the category label information.

In spite of the lack of significant results to support the hypotheses, this study contributes to the existing literature on categorization in multiple ways. This research is the first to explore how the usage of a superordinate category label pertains in the context of radically aesthetic innovation. In particular, this study sheds light on the superordinate category design and empirically tests how this affects consumers’ categorization efforts and product preferences. Analyses of the experiment signifies, however, no potential findings for the superordinate category label design in relation to a radically aesthetic innovative product, which could thereby contribute to the general understanding of withholding other researchers in repeating resources on this specific subject. Lastly, this study also still fires up the discussion about what type of information, conceptual or perceptual, consumers will mainly use when forming their inferences in case of radically aesthetic innovative products.

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

2. THEORY 2.1 Radically aesthetic innovation

Before discussing the main subject of this paper, that is, the effect of the superordinate category label design in context of a radically aesthetic innovative product, it has to be made clear what we understand by this concept. Presently isomorphic processes, in which competitors often imitate strategic choices, triggers and increases the overall attention of a firm’s pursuit for aesthetic innovation in their product design (Eisenman, 2013; Glynn and Abzug, 2002; Zuckerman, 2004). In the end only certain products are selected and retained by consumers (Anderson and Tushman, 1990; Utterback and Abernathy, 1975) and simply differentiation based on products’ technical factors to improve a firms’ performance is not sufficient nowadays (Black and Baker, 1987; Hertenstein et al., 2005; Kotler and Rath, 1984; Trueman and Jobber, 1998; Walsh, Roy, Bruce and Potter 1992).

A review of existing literature shows that different authors use several concepts that can be linked to the concept of radically aesthetic innovative product. From this perspective, a radically aesthetic innovative product comprehends a high level of design newness (Mugge and Dahl, 2013; Talke et al., 2009), high aesthetic and symbolic content (Eisenman, 2013; Rampino, 2011), greater performance quality (Mugge and Schoormans, 2012) and an unusual visual appearance (Bloch, 1995; Hekkert, Snelders and Wieringen, 2003). Therefore, a radically aesthetic innovative product can be consumed for a more affective or sensory fulfilment purpose (Hirschman, 1983; Holbrook, 1986a, 1986b; Holbrook and Anand, 1992). In this line, the product is accompanied by the product semantics – the understanding that the visual appearance (shape, size, color) act as a signifier that communicates meanings

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

Figure 1

Visual Appearance Nescafe Dolce Gusto Krups Drop Automatic

2011; Verganti, 2009). In this particular situation, consumers attach a greater value to the product experience itself than the functionality of the product (Hirschman, 1980). Consequently, a radically aesthetic innovative product can enable consumers to express their identities and social statuses via the consumption of it (Belk, 1988; Solomon, 1983). Consider the Nescafe Dolce Gusto Krups drop automatic for example (figure 1). The visual appearance of this coffee machine emphasize the radically aesthetic innovation of this invention, which turns the household appliance from being functional (i.e. providing coffee) into a symbolic object of affection (Creusen and Schoormans, 2005; Verganti, 2008).

Furthermore, radically aesthetic innovations are often also known for altering existing markets or creating new ones (Hoeffler, 2003; Meyers and Tucker, 1989; Veryzer, 1998). When a product or industry reaches the phase of maturity, which is often initiated by the decline in the overall demand (Day, 1981), a radically aesthetic innovative design can be employed to communicate and increase its value to customers (Eisenman, 2013; Low and Abrahamson, 1997). This is particularly important nowadays for technology-based firms as the product design can provide a bridge between market opportunities and technical innovations (Candi, 2006; Gemser and

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

Leenders, 2001; Gemser and Wijnberg, 2002). Indeed, Eisenman (2013) argues that the establishment of a radically aesthetic innovative product design is often triggered by the coevolution of technical innovation. Firms can compete by offering their new product, derived from new technology, via a radically aesthetic innovative product design (Eisenman, 2013). In other words, through product design firms are able to explain radical technological character of the product.

Similarly, Talke et al., (2009) and Rindova and Petkova (2007) states that design newness and technical newness can be conjointly used to emphasize the interaction effect between both newness dimensions and thereby increase the perception of the value of an innovation. However this is not always the case, firms can also embody incremental innovations in a novel product form to increase the perceived value (Rindova and Petkova, 2007). Additionally, expressing new technology through a non-aesthetic innovative product design is also valuable and essential (Veryzer and Hutchinson, 1998), however this is beyond the scope of this paper.

Sincethe visual appearance of radically aesthetic innovative product design tends to be significantly different from existing products, it can create a competitive advantage because it allows a better differentiation between alternatives (Bloch, 1995; Kotler and Rath, 1984; Trueman and Jobber, 1998; Yamamoto and Lambert; 1994) and thereby receives more attention (Schoormans and Robben, 1997) which consequently has a positive effect on the product evaluation (Creusen and Schoormans, 2005). Although firms may perceive the pursuit for a radically aesthetic innovative product design as a realistic mean to differentiate in the marketplace, its strategic decision can backfire in terms of consumers’ categorization difficulties. Since there are some differences between consumers and designers (Hsu, Chuang and Chang, 2000; Verganti, 2008), firms can encompass a greater level of aesthetic innovation in a products’ visual

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

appearance than consumers are willing to accept (Bloch, 1995). Indeed, marketing and consumer research studies show that when a product’s visual appearance is highly unusual or extremely new,the consumer struggles to categorize it and attempts to fit it onto an existing product category (Gregan-Paxton, Hibbard, Brunel and Azar, 2002; Jhang et al., 2012; Moreau, Lehmann and Markman, 2001; Moreau et al., 2001). This perceptual (i.e. visual) incongruity may result in the fact that consumers may find it difficult to determine the products’ category membership and might therefore result in a negative product evaluation (Alexander et al., 2008; Campbell and Goodstein 2001; Noseworthy and Trudel, 2011; Rindova and Petkova, 2007).

2.2 Product appearance and categorization

Category membership knowledge can be pertained through either perceptually via the visual appearance of a category frame or conceptually via the textual information (Gregan-Paxton et al., 2002; Gregan-Paxton et al., 2005). Category membership knowledge can be described as the categorization process in which a new product is judged according to the perceived fit of its membership in a category that already contains a product or gathering of products (Goode et al., 2013; Gregan-Paxton et al., 2002; Loken and Ward, 1990; Moreau, Lehmann et al., 2001; Zuckerman, 2004). Since the visual appearance of a product is the first thing consumers notice in an innovation, it therefore directly communicates information (i.e. knowledge) about the product category (Noble and Kumar, 2010; Olshavsky and Spreng, 1996; Schoormans and Robben, 1997).

However, consumers are only able to connect the dots that they already have collected (Cohen and Basu, 1987; Sujan, 1985). To clarify, categorization of a new product activates the consumers existing mental schema (i.e. knowledge base) from which they can identify, compare and evaluate new attributes and benefits

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(Gregan-

Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

Paxton et al., 2005; Moreau et al., 2001; Rindova and Petkova, 2007; Talke et al., 2009). From this point of view, a product will be categorized as belonging to a specific category when there is a positive match between the consumers’ prior knowledge of a category and the experience of the visual characteristics of a new product (Creusen and Schoormans, 2005; Goode et al., 2013; Moreau, Lehman et al., 2001; Rindova and Petkova, 2007).

The establishment of a products’ dominant architecture (i.e. archetype) can provide the consumer guidance in their product categorization (Gregan‐Paxton et al., 2002; Rampino, 2011). In this particular situation, a product in a given category tends to be closely visual resembled to the overall product archetype: televisions, washing machines and refrigerators are various examples (Rampino, 2011). As a result, the product is perceived as more familiar and cause less uncertainty (Goode et al., 2013; Rampino, 2011), which has a positive affect on the consumer product evaluations (Blijlevens, Creusen and Schoormans, 2009; Veryzer and Hutchinson, 1998). Conversely, when the product’s visual appearance differs significantly from the overall product archetype in the relevant product category, identifying the product category may be difficult or even impossible, which is often the case with a radically aesthetic innovative product design (Goode et al. 2013; Jhang et al., 2012; Moreau et al., 2001).

2.3 Radically aesthetic innovation and categorization certainty

When the Apple iPad first appeared on the market, consumers lacked a knowledge structure that would allow them to directly identify the product category and thereby be able to make sense of its attributes and benefits (Gregan-paxton et al., 2002; Moreau et al., 2001). There were no visual similarities that indicated the specific category for the iPad since the dominant architecture was not yet established (Goode et al., 2013;

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

These radically aesthetic innovative products, such as the iPad, are often characterized by the fact that they cannot be categorized into existing product categories and therefore regularly form the roots for new product categories (Garcia and Calantone, 2002; Gregan-Paxton and John, 1997). Though, there are also radically aesthetic innovations that are still belonging to the same category such as the Dyson Air Multiplier. This fan deviated in its appearance and technology from the classic fan but remained within the existing category ‘ventilators’ (Goode et al., 2013; Moreau, Lehmann et al., 2001).

As previously mentioned, a radically aesthetic innovative product is often incongruent with consumers’ expectations and their existing category schema, as the product’s visual appearance differs significantly from the overall product archetype (Goode et al., 2013; Moreau et al., 2001; Noseworthy and Trudel, 2011; Stayman, Alden and Smith, 1992). Schoormans and Robben (1997) empirically find that a radically product appearance receives high attention but scores low on acceptance: the product is perceived outside the range of acceptable product appearances for that particular product category. This perceptual incongruity can result in higher uncertainty (Goode et al., 2013; Hoeffler, 2003; Mugge and Dahl, 2013). Consumers are unsure about what knowledge can be transferred from their mental schema to the new product when they feel that the innovation does not fit with their existing schema (Moreau, Lehmann et al., 2001; Rindova and Petkova, 2007).

Consequently, when a product is difficult to categorize into an existing category based on its visual appearance, consumers may not consider the product as a purchase alternative (Alexander et al., 2008; Campbell and Goodstein 2001; Creusen and Schoormans, 2005; Schoormans and Robben, 1997). For the potential value and benefits of a radically aesthetic innovative product to be perceived and therefore to be

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

considered as a purchase alternative (Rindova and Petkova, 2007), the preliminary perceptual incongruity that it triggers must be resolved (Jhang et al., 2012; Mugge and Dahl, 2003; Rindova and Petkova, 2007). From this frame of reference, firms can provide category labels to guide consumers in their categorization efforts and eventually resolve the perceptual incongruity (Goode et al., 2013; Gregan-Paxton et al., 2005; Yamauchi and Markman, 2000).

2.4 Category labels and evaluation

Marketers can stimulate and encourage the categorization task by providing consumers a plausible category label that suggests a products category (Goode et al., 2013; Suarez and Grodal, 2014; Yamauchi and Markman, 2000). Category labels stimulate consumers in transferring the knowledge from the existing category to the new product in order to maximize the perceived similarity (Yamauchi and Markman 2000). In other words, for instance when a firm uses an existing category label to refer to a radically aesthetic innovative product, they signal that this product belongs to the same category and thereby comprehends a degree of familiarity (Grodal, Gotsopoulos and Suarez, 2015). Overall, category labels provide consumers guidance and encouragement in their categorization efforts and form references for comparison to existing products in order to judge the value of new products (Mogilner et al., 2008).

In addition, Grodal et al. (2015) address the ‘rule of membership’ in relation to category labels. The rules of membership can be described as specific characteristics a product must contain to be considered as belonging to that category (Grodal et al., 2015; Suarez and Grodal 2014). Thus, when the category label possesses sufficient similarities with the visual appearance, the product should be categorized in the proposed category (Creusen and Schoormans, 2005; Goode et al., 2013; Yamauchi and

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

However, a classification system, such as providing category labels, often consists of multiple hierarchical levels. According to the authors Rosch and Mervis (1975) the human concepts of categorization ensure three different levels; superordinate category level (e.g., kitchen appliances), basic category level (e.g., coffee machines) and subordinate category level (e.g., espresso coffee machine). From this frame of reference, subordinate category labels can be seen as more concrete and imageable and are likely to be comparable on more specific sets of attributes than members of superordinate category labels (Loken and Ward, 1990; Rosch et al., 1976). Thus, as a subordinate category label may trigger a greater similarity, it might guide consumers when the product category is not directly obvious and when the categorization effort turns out to be difficult (Gregan-Paxton et al., 2005; Moreau et al., 2001).

Since a radically aesthetic innovative product is likely to trigger disorientation and uncertainty as the visual appearance often deviates from the existing category (Mugge and Dahl, 2013), reconciling this incongruity by applying a subordinate category label can result in the generation of positive affect (Jhang et al., 2012; Meyers-Levy and Tybout, 1989; Rindova and Petkova, 2007). Based on prior literature, the following hypotheses can be formulated:

H1a: Providing the subordinate category label a radically aesthetic innovative product belongs to, results in a positive effect on consumers’ categorization certainty.

H1b: Providing the subordinate category label a radically aesthetic innovative product belongs to, results in a negative effect on consumers’ perceived incongruity.

On the other hand, the proposed subordinate category label might not have sufficient similarities with the visual appearance of a radically aesthetic innovative product to categorize it in the proposed category (Goode et al., 2013; Grodal et al.,

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

2015; Suarez and Grodal 2014; Zuckerman, 1999). In other words, radically aesthetic innovations do not match to the category’s rules of membership, as consumers are not able to affix the subordinate category label with certainty. Consequently, these products face the risk of being overlooked by consumers and eventually firms still might suffer from performance drawback (Goode et al., 2013; Grodal et al., 2015; Suarez and Grodal 2014; Zuckerman, 1999).

2.5 Superordinate category label and categorization

Previously mentioned, situations can occur where consumers remark a product category membership by the provided subordinate category label, but may not be convinced or are uncertain that the product is a valid member of that particular category as the visual appearance deviates too strongly (Goode et al., 2013). From this point of view, a radically aesthetic innovative product may be stored under a superordinate category label in order to stimulate and guide consumers better in their categorization efforts.

Superordinate concept categories are sufficiently abstract; they include more diverse exemplars and therefore have a few, if none, attributes in common to all members (Rosch et al., 1976; Goldberg, 1986). In this line, objects are almost entirely related to each other by means of family resemblances of overlapping attributes (Rosch and Mervis, 1975). Rorissa and Iyer (2008) empirically show that sorting tasks, that involve people to group things together, lead to categorization at the superordinate level. More importantly, Markman and Wisniewski (1997) argues that people are less likely to fail in their categorization an object at the superordinate level, since these categories have been around longer than subordinate categories (p. 68). Thus, in this study the superordinate category label comprehends unique abstract meanings that

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

typically originate from a particular configuration of product features (e.g. high level of design newness, high priced, unique, novel, unusual appearance etc.)

Consequently, in comparison to simply providing the subordinate category label, providing a superordinate category label might trigger a more abstract representation as it may include various archetypes, each with different attributes, which might reconcile with the visual appearance of a radically aesthetic innovation. From this perspective, to surpass the subordinate category label and therefore employing an additional superordinate category label might stimulate and guide consumers better in their categorization effort for a radically aesthetic innovative product.

2.5.1 Superordinate category label: design

The word design has won its central place in present-day communication since people tend to look behind the word and concept of it (Flusser and Cullars, 1995). According to the same authors design also currently indicates any situation in which art and technique is coming together to combine forces (Flusser and Cullars, 1995). Although this might be true, the term design is given quite specific and different meanings among certain groups of people (Lawson, 1983), and covers a wide scope of activities in the literature such as graphic design, industrial design, fashion design and interior design (Walsh, 1996). Thus design may be an applicable denoting to a categorical construct of a created object, or a verb for the process of creation (Lawson, 1983).

This present study moves to a more in-depth conceptualization where the word design is associated with end products that tend to look significantly different in terms of their visual appearance from the overall product archetype (Rampino, 2011). The design product encompasses radically aesthetic innovative and extremely new visual elements that communicate meaning that extend the material embodiment (Eisenman; 2013; Rampino, 2011; Verganti, 2009).

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

From the existing literature the word design occurs in context associated with fashion, style and trendy (Walsh, Roy and Bruce, 1988), high aesthetic (Eisenman, 2013;), unusual or novel (Hekkert et al., 2003), newness (Talke et al., 2009) uniqueness (Bloch, 1995), high quality and craftsmanship (Kristensen, Gabrielsen, Zaichkowsky, 2012), radically invention as in innovation (Walsh, 1996) and higher priced products (Fortsythe, 1991; Kotler and Rath, 2007). Previously mentioned, in modern life the words design and art are closely related to one another (Coles, et al., 2007; Flusser and Cullars, 1995; Lawson, 1983). For example, according to Lawson (1983) a good design can be seen as an art piece to enrich the lives of people and therefore can have a greater impact on their daily lives. Thus using design as superordinate category label may contain a particular concept in terms of associations with it, which can be used as a vehicle to categorize a radically aesthetic innovation.

Although a high level of perceptual incongruity is likely to have a negative effect on categorization and the perceived value, its resolution can be gratifying, and can have positive effects on both (Jhang et al., 2012; Mandler, 1982; Rindova and Petkova, 2007). Accordingly, by being stored together under the same superordinate concept category label design may increase the consumers’ product categorization certainty and lowers the perceived incongruity, therefore, the following hypothesis can be stated:

H2a: Providing the superordinate category label design has a positive effect on consumers’ categorization certainty for a radically aesthetic innovative product. H2b: Providing the superordinate category label design has a negative effect on consumers’ perceived incongruity for a radically aesthetic innovative product.

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

As words can differ in their meaningfulness and pleasantness (Goldberg, 1986) and consumers may associate the superordinate category label design with the Applied Arts, this label might also be perceived as a means to add specific value in terms of aesthetic pleasure and willingness to pay (Fortsythe, 1991; Kotler and Rath, 2007; Mogilner et al., 2008; Schreier, Fuchs, and Dahl, 2012).

2.6 Aesthetic pleasure and visual appearance

Many firms are leveraging visual aesthetics as a way to differentiate in matured markets since consumers nowadays are placing an increasing value on the visual aesthetics of product design (Bloch et al., 2003; Creusen and Schoormans, 2005; Page and Herr, 2002; Radford and Bloch; 2011;Veryzer and Hutchinson, 1998; Yamamoto and Lambert, 1994). Implementing aesthetics in product designs is also stimulated by the growth of online shopping, where the external appearance of a product is prominent and what may trigger the initial desire to purchase (Rampino, 2011). In either way, consumers will pay more attention to products that visually stand out from its competitive products (Creusen and Schoormans, 2005).

Aesthetic pleasure relates to the particular aspect of cognitive responses: it is the perception of how pleasing the process of observing an object is as a whole, without considering the functionality of the product (Holbrook, 1980). People are motivated to avoid products that provide displeasure and seek for products that provide more pleasure that are beneficial to their primary senses (Desmet and Hekkert, 2007; Hekkert, 2006). Indeed, prior research has shown that when a product is perceived in the same functioning and price, the consumer will prefer the one that is more aesthetical (Creusen and Schoormans, 2005). Additionally, since aesthetic pleasure primarily consists of emotional responses, they are also personally bounded (Bamossy, Scamoon an Johnston, 1983).

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

Furthermore, obtaining aesthetic pleasure from products enables consumers to express their identities and social statuses via the consumption of it (Belk, 1988; Solomon, 1983). In this line, acquiring an aesthetic innovative product design can be seen as a form of self-expression, which can enhance a desirable image in a social context (Coates, 2003). This can have a positive affect on the consumers’ design appraisal (Belk, 1988; Eisenman, 2013; Solomon, 1983), whereby the preference of consumers decline when the product becomes more widely available (Ward and Loken, 1988). Although the visual appearance is the prominent component by establishing aesthetic pleasure of a product (Goode et al., 2013; Creusen and Schoormans, 2005), the label information of a product might also have an effect on the visual aesthetic perception of the product (Goldberg, 1986; Mogilner et al., 2008; Rindova and Petkova, 2007).

2.6.1 Design label: aesthetic pleasure and willingness to pay

Next to assisting consumers in their categorization efforts for a radically aesthetic innovative product, the superordinate category label design might have a facility for adding value in terms of higher aesthetic pleasure and willingness to pay. Similarly the words design and aesthetic pleasure are also closely linked to one another since design products are often associated with high and innovative aesthetic elements (Bloch, 1995; Trueman and jobber, 1998; Walton, 1993). The superordinate category label design might therefore increase the perception of how pleasing the product is. As already mentioned, today the term design is widely associated with the Applied Arts, which can align with the idea that the superordinate label design may not only increase consumers categorization certainty and lowers the perceived incongruity but also increase the aesthetic value of a radically aesthetic innovative product. However, on

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

Walton, 1993) and might cause a counter intrinsic feeling in terms of immunity and indifferently towards the label.

From a completely other perspective, in the study of Schreier et al. (2012) consumers evaluate a same product more positively and denote stronger purchase intentions if it is labeled as ‘created by users’ versus the firm’s internal designers. In this line, most consumers expect to pay a higher price for reasons other than the quality of the product itself (Fortsythe, 1991) and show therefore potential for the superordinate label design. According to the authors Kotler and Rath (1984) design also appears in the description of higher priced products, such as designer furniture or designer jeans. This provides also support for the idea that the superordinate category label design might be perceived as a means to add value. Therefore, based on existing literature the following hypotheses can be specified:

H3a: Providing the superordinate category label design has a positive effect on consumers’ product aesthetic pleasure for a radically aesthetic innovative product. H3b: Providing the superordinate category label design has a positive effect on consumers’ willingness to pay for a radically aesthetic innovative product.

2.7 Consumers’ design acumen

Consumers can differ in the degree to which they pay attention to, or are affected by a particular product design (Bloch et al., 2003). In this line, the authors Csikszentmihalyi and Robinson (1990) argue that consumers’ design acumen can be seen as a personality trait and is something which certain people are born with. People with high design acumen posses the ability to recognize, categorize and evaluate product designs and are often characterized as design-minded people (Bloch et al., 2003; Csikszentmihalyi and Robinson, 1990). These people are able to make quicker sensory

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

connections and express more sophisticated preferences towards the design of things (Bloch et al., 2003; Csikszentmihalyi and Robinson, 1990). Whereas people with low design acumen are rather indifferent to a product design (Bloch et al., 2003).

Previous studies in the consumer research (Childers, Houston and Heckler, 1985; Holbrook, Chestnut, Oliva and Greenleaf, 1984) have demonstrated that some consumers prefer visual processing over verbal processing. Consumers that are highly visual attend more to the visual design elements and therefore may have higher preferences for aesthetic attributes in their product choices than consumers with low visual processing (Holbrook, 1986b). Similarly, the authors Kristensen et al. (2012) argue that consumers who score low on design acumen might rely more on external cues, such as product labels and brand names, rather than the actual visual design of a product to form their preferences. Whereas consumers who score high on design acumen may rely more on the real design of a product to develop their preferences (Kristensen et al., 2012). From this perspective the superordinate category label design might have a greater influence on consumers who score low on design acumen than consumers who score high on design acumen. Therefore the following is expected:

H4a: Consumers’ design acumen positively moderates the effect of providing the superordinate category label design on consumers’ product aesthetic pleasure for a radically aesthetic innovative product.

H4b: Consumers’ design acumen positively moderates the effect of providing the superordinate category label design on consumers’ willingness to pay for a radically aesthetic innovative product.

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

3. METHODOLOGY

To examine whether or not the superordinate category label design effects consumers’ product categorization certainty, willingness to pay, perceived incongruity and aesthetic pleasure for a radically aesthetic innovative product and whether this is moderated by consumers’ design acumen, an experimental vignette study was applied. In this particular study, participants were exposed to an advertisement for a radically aesthetic innovative product. To test the hypotheses it was necessary to create three treatments and one control advertisements.

3.1 Product class

A pretest (n = 36) was administered to increase the generalizability of the results; five product designs from five different categories (coffee machine, tumble dryer, iron, hairdryer and washing machine) were selected as stimulus material (see appendix A). These categories were selected since most consumers are daily exposed to their currently dominant archetype (Gregan-Paxton et al., 2002; Rampino, 2011). Moreover, these categories also contain a high penetration level, implying that theses products are important to the participants (Mugge and Dahl, 2013). Measuring the existing knowledge of the target population in a pretest can insure the lack of visual familiarity. In this line, to decrease this chance for visual familiarity, product concepts were chosen as stimulus material since they are not introduced on the market yet.

Familiarity was measured using a one five-point scale item adapted from Gregan-Paxton et al. (2005) with a scale ranging from 1 (extremely unfamiliar) to 5 (extremely familiar). In addition, on a seven-point scale anchored by 1 (strongly disagree) to 7 (strongly agree) participants answered one item assessing whether it was difficult to categorize the product (Campbell and Goodstein, 2001). Furthermore, since the

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

superordinate category label design is central in this study, participants also answered one item assessing to which extent they perceived the product as a design product, by rating the product from 0 (not a design product at all) to 10 (really a design product). Finally, participants rated on a five-point scale the products’ aesthetic visual innovativeness anchored by 1 (not aesthetic visual innovative at all) to 5 (extremely aesthetic visual innovative). Note that, the products did not contain any visual brand name or logo to avoid primed results.

A repeated measures Analyses of Variance (ANOVA) was conducted to compare the effect of the different product designs on familiarity, categorization, perceived design product and aesthetic visual innovativeness. The ANOVA analyses confirmed statistically that across product categories mean familiarity F(4, 140) = 9.687, p < .001., and mean categorization F(4, 140) = 6.357, p < .001., differed significantly. Further, the results showed that there was no significant effect of product categories on aesthetic visual innovativeness, F(4, 140) = 0.307, p = .08, and perceived design product F(3,06, 140) = 0.596, p = .623. These results suggested that no product category was significantly more aesthetic visual innovative and perceived as a design product in comparison to the other product categories. Thus, analyses on these five product categories separately confirmed that participants perceived the tumble dryer and hairdryer as least familiar and most difficult to categorize (see table 1).

Based on these results, the concept hairdryer of Dyson was chosen as the stimulus for a radically aesthetic innovative product design since it represented the lowest familiarity across product categories and showed a high-level of product categorization difficulty. In addition, the hairdryer was also chosen since the products of Dyson have been featured extensively in the consumer and product innovation management

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

literature (Goode et al., 2013; Noble and Kumar, 2010; Noseworthy, Di Muro and Murray, 2014;Radford and Bloch, 2011; Talke et al., 2009).

Table 1

Results Pre Test - Means and Standard Deviations for the Dependent Variables Broken Out by Product Category

Coffee machine

Tumble

dryer Iron Hairdryer

Washing machine M SD M SD M SD M SD M SD Familiarity 2.56 1.03 1.83 1.23 3.14 1.31 1.81 1.04 2.06 1.04 Categorization 3.72 1.65 5.08 1.86 3.61 2.06 4.89 2.01 4.61 1.73 Perceived design 7.33 1.96 6.83 2.51 6.91 2.06 6.86 2.02 7.22 1.79 Aesthetic innov. 3.06 .89 3.25 .99 3.17 .85 3.22 1.12 3.25 .99 3.2 Experimental design

Design, procedure and stimuli. All participants (n = 264) were surveyed through an online questionnaire. Thereby participants were not aware of the other treatments nor saw other treatments. The average age of the sample was 30.1 years, and 57 percent of the participants were female. Participants were mostly students and acquaintances who primarily possessed a bachelor’s (60,6%) or a master’s degree (24,9%).

Two factors were manipulated between-subjects: (1) the subordinate category label (present or not present) and (2) superordinate category label design (present or not present). Participants were randomly assigned to one of the four treatments in this two-by-two between-subjects experimental design, were the specific label cue was the manipulated factor. In the first control treatment, the subordinate category label and superordinate category label design were both absent in the advertisement. In the second treatment, the product was labelled with the subordinate category label ‘Hairdryer’. In the third treatment, the subordinate category label was absent and enclosed only the design label: ‘Design product’. Finally, in the fourth treatment, both subordinate label and superordinate category label design were present, shown as

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

‘Design hairdryer’. Note that, participants were only exposed to one advertisement in each treatment.

Thus, four versions of an advertisement for the hairdryer were created to cue different label conditions (see appendix B). To avoid obvious and logical demand effects by providing no explanation at all about the functionality of the product, a short description was specified in the advertisement: “Make an instant and noticeable difference in the way you dry your hair with the new XT-100”. By adding this particular phrase the advertisement could be perceived as more representative and realistic for a today’s advertisement. Furthermore, by providing this description participants were also encouraged to think of the product as a whole rather as assembly of different attributes. In addition, the product in the advertisements did not contain any visual brand name or logo in order to avoid primed categorization and demand effects. In summary, three versions of the advertisement, without any brand name or logo, enclosed three basic components: the product, the label (i.e. headline) and a short description below the label. Except from the control condition, here both category labels were absent providing no contextual cue at all.

Participants were told that the purpose of this research was to investigate consumer responses to new products and were instructed to observe the advertisement attentively to form an impression of the product featured. The advertisement appeared on the second page of each treatment, after the introduction, and participants were able to view it at their own pace before completing the accompanied questionnaire. The back button, that enabled participants to see the advertisement again to perhaps change their responses, was not integrated in the survey in order to secure the internal validity. In the first section willingness to pay was asked in order to reduce hypothesis guessing and thereby obviate the primed effect of other questions on the outcome. This question

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

was followed up by questions about participants’ categorization certainty, perceived incongruity, aesthetic pleasure and design acumen. Finally, in the last part the following socio-demographic characteristics were collected: gender, age, level of education and monthly gross income (see appendix C for the complete survey).

3.3 Dependent measures

Categorization certainty. Measures of categorization certainty were derived from the study of Goode et al., (2013). Participants indicated their agreement from 1 (strongly disagree) to 7 (strongly agree) on the following statements: “I knew what the product was right away”, “I am not sure about the product” (reverse scored), “I am very certain about what I think the product is” and “I will be very confident telling another person what the product is” (Goode et al., 2013, p. 196). Responses on these four items were averaged to create an index of categorization certainty (α = .81).

Willingness to pay. A direct open question approach for the measurement of willingness to pay was used (Breidert, Hahsler and Reutterer, 2006). To this end, the following item was formulated: “Imagine you will have to place a bid on this product, what would you offer? In other words, what price are you willing to pay for this product”. Participants filled out their bid in the Euro currency.

Perceived incongruity. Assesses of the overall perceived incongruity in this study was measured by a comprised scale adapted from Campbell and Goodstein (2001). Additionally the construct was measured on two different categorization levels of the human concepts, namely: subordinate category level and superordinate category level (Rosch and Mervis, 1975; Rosch et al., 1976). To measure perceived incongruity on the subordinate category level participants were asked on 7-point scales from 1 (strongly disagree) to 7 (strongly agree), “This product design is unusual for a hairdryer” and “This product design is typical for a hairdryer”. The latter item was

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

reverse scored. Participants also answered an item assessing whether it was difficult to categorize the product, “It is difficult to categorize the product as a hairdryer” (Campbell and Goodstein, 2001). These three items were averaged to generate an index of perceived subordinate category incongruity (α = 0.71).

To measure perceived incongruity on the superordinate category level participants were asked the same items with the associated scale, however the hairdryer was replaced by the words ‘design product’, “This product is unusual for a design product”, “This product is typical for a design product” and “It is difficult to categorize the product as a design product”. Responses to the first and third items and the reverse score of the second item were averaged to form the index of perceived incongruity on the superordinate category level (α = 0.76).

Aesthetic pleasure. According to Blijlevens, Thurgood, Hekkert, Leder and Whitfield (2014) research within the domain of aesthetics lacks a coherent and reliable scale to measure the construct aesthetic pleasure. From this point of view these authors have developed a specific scale to measure this construct. In this line, aesthetic pleasure can be measured on a 7-point scale from 1 (strongly disagree) to (7 strongly disagree) with the items: “This is a beautiful product”, “This is an attractive product”, “This product is pleasing to see”, “This product is nice to see” and “I like to look at this product”. These items measure the construct aesthetic pleasure, separate from its determinants, thus as a singular construct (Blijlevens et al., 2014, p. 105). These items were averaged to produce an index of aesthetic pleasure (α = 0.94).

3.4 Moderating measure

Design acumen. To measure participants’ design acumen, participants filled out a facet of the ‘Individual Differences in the Centrality of Visual Product Aesthetics’ scale,

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

acumen, according to the following statements: “Being able to see subtle differences in product designs is one skill I have developed over time”, “I have pretty good idea of what makes one product look better than its competitor”, “I see things in a product’s design that other people tend to pass over” and “I have the ability to imagine how a product will fit in with designs of other things I already own” (Bloch et al., 2003, p. 556). Participants indicated, using 7-point rating scales, to what extent they agree with these statements. Ratings were also averaged to create the index of design acumen measure (α = 0.80). A median split was applied in order to create two groups: participants low in design acumen, and participants high in design acumen (Iacobucci, Posavac, Kardes, Schneider and Popovich, 2015).

4. RESULTS 4.1 Descriptive statistics

Table 2 reports the treatment means, standard deviation and number of observations for the core dependent measures of this study. The observations (N) across the treatments differ somewhat as respondents were randomly assigned to one of the four treatments. Additionally, respondents had the possibility to step out of the survey at any time. The means in table 2 indicate, as expected, that providing the superordinate category label design has a positive effect on consumers’ categorization certainty compared to only providing the subordinate category label (M = 4.01, SD = 1.47, M = 3.82, SD = 1.17 versus M = 3.68, SD = 1.48). In other words, the number of respondents who experienced the advertisement with the design label categorized the product more with certainty than the number of respondents who experienced the advertisement with only the subordinate category label. It is worth nothing that, contrary to the expectations, respondents in the control group (treatment 1) were more

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

certain about categorizing the radically aesthetic innovative product in comparison to the treatment were the subordinate category label was provided (M = 3.96, SD = 1.54 versus M = 3.68, SD = 1.48). Moreover, as expected, compared to specifying the subordinate category label, providing the superordinate category label design resulted in a higher positive effect on aesthetic pleasure (M = 4.95, SD = 1.22, M = 4,71, SD = 1.34 versus M = 4.68, SD = 1.29) and willingness to pay (M = 52.29, SD = 42.48, M = 48.23, SD = 35.51 versus M = 44.83, SD = 33.90). Again, values for the control group, displaying no label at all, were surprisingly high for aesthetic pleasure (M = 4.80, SD = 1.26) and willingness to pay (M = 50.58, SD = 29.75). Finally, descriptive statistics of perceived incongruity on the different categorization levels of the human concepts shows that overall scores on perceived superordinate incongruity (see table 2) were lower in comparison to scores on the perceived subordinate category incongruity. These results suggest that respondents were more accurate at mapping schema-relevant information when the radically aesthetic innovative product was measured on the superordinate category label design.

Analyses of Variances (ANOVAs) between-subjects and independent-samples t tests were used to test the several experimental effects1. In the one-way ANOVA, the condition variable indicating whether which treatment respondents were assigned to, was treated as one independent factor to examine the overall group mean differences. Further, independent-samples t-tests were used to conduct comparisons of any two treatments within that independent factor. For instance, to determine if a difference existed between the means of the treatment providing the subordinate category label (i.e. Hairdryer) and the treatment providing both subordinate category label and

1 In case of absent scores, rather than deleting the entire case, analysis for the individual measures were conducted

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

superordinate category label design (i.e. Design hairdryer). When the superordinate category label design was compared to the treatment without the superordinate category label, the treatment variable was recoded into dummy variables. Additionally, the plug-in software PROCESS macro allowed regression analyses within SPSS to examine the role of the moderator (Hayes, 2012).

Table 2

Treatment Means, Standard Deviations and Observations for the Core Dependent Variables

N M SD

Treatment 1 (no labels)

Categorization certainty 62 3.96 1.54 Perceived incongruity: superordinate level 62 3.09 1.17 Perceived incongruity: subordinate level 62 4.97 1.21 Aesthetic pleasure 62 4.80 1.26 Willingness to pay 62 50.58 29.75

Treatment 2 (‘Hairdryer’)

Categorization certainty 68 3.68 1.48 Perceived incongruity: superordinate level 68 3.22 1.21 Perceived incongruity: subordinate level 66 5.06 1.13 Aesthetic pleasure 66 4.68 1.29 Willingness to pay 71 44.83 33.90

Treatment 3 (‘Design product’)

Categorization certainty 64 3.82 1.17 Perceived incongruity: superordinate level 62 2.97 1.14 Perceived incongruity: subordinate level 62 5.15 1.21 Aesthetic pleasure 62 4.71 1.34 Willingness to pay 66 48.23 35.51

Treatment 4 (‘Design hairdryer’)

Categorization certainty 64 4.01 1.47 Perceived incongruity: superordinate level 63 3.15 1.17 Perceived incongruity: subordinate level 63 4.98 1.14 Aesthetic pleasure 63 4.95 1.22 Willingness to pay 65 52.29 42.48

4.2 Hypothesis testing

Categorization certainty. To test the hypotheses, comparisons were conducted between the treatment in which the subordinate category label was presented to the treatment in

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

No Label Subordinate Label Design Label only Subordinate and Design Label Treatments 4.00 3.90 3.80 3.70 C at egor iz at ion C er tai n ty Figure 2

The Effect of Treatments Levels on Categorization Certainty (Means)

which there was no label featured and the treatments where the superordinate category label design were present. First, a one-way Welch ANOVA was executed to determine if the categorization certainty score for a radically aesthetic product diverged for all the different treatment levels. There was heterogeneity of variances, as assessed by Levene's test of homogeneity of variances (p = .026). As figure 2 shows, categorization certainty scores increased from providing the subordinate category label (M = 3.68, SD = 1.48), to providing only the design label (M = 3.82, SD = 1.17), to providing no label at all (M = 3.96, SD = 1.54), to providing both subordinate category label and superordinate category label design (M = 4.01, SD = 1.47), in that order, but the differences between these groups were not statistically significant, Welch's F(3, 140.002) = .666, p = .574.

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

where only the subordinate category label was specified t(128) = 1.069, p = .287, or between the groups where the subordinate category label was present and both subordinate category label and superordinate category label design was featured t(130) = -1.276, p = .204. In addition, a comparison was conducted between the treatments where the superordinate category design label was provided (3 and 4) and the treatments where this was absent (1 and 2). Again, results showed no significant values for this comparison t(252.634) = -.547, p = .585,

Overall, it was expected that respondents would score higher on categorization certainty when a subordinate category label was specified (Gregan-Paxton et al., 2005; Moreau et al., 2001). However this presumption did not emerged from the analysis. Moving beyond the subordinate category label, it was also expected that by applying a superordinate category label respondents were better stimulated and guided in their categorization efforts, resulting in even higher categorization certainty scores. Although the descriptive statistics provided indication for the later, it was not empirically supported. Thus, as the ANOVA and independent samples t-tests did not disclose significant results they do not provide support for Hypotheses 1a and 2a.

Willingness to pay. From the descriptive statistics, indicated in table 3, respondents were willing to pay more for a radically aesthetic innovative product when it was advertised as ‘Design hairdryer’ instead of solitary advertised as ‘Hairdryer’. In addition, scores for the control group were surprisingly high (M = 50.58, SD = 29.75); this was in contrast to what is predicted. Noteworthy, in two treatments the minimum willingness to pay was zero Euros. A possible explanation for this occurrence is that among several respondents no interest in or attached value to the advertised product was ensued.

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

A Kruskal-Wallis H test was conducted to examine the effect of the different treatments levels on willingness to pay. This non-parametric test was conducted, as the dependent measure was not normally distributed. Median willingness to pay scores were not significantly different between the treatment levels, χ2(3) = 2.781, p = .427. Further, a Mann-Whitney U test was used to determine if there were differences between the treatments where the subordinate category label was present and were both subordinate category label and superordinate category label design was featured. A significant difference, Mann-Whitney U = 2078.50, Z = -1.004, p = .316, was not found. In addition, another Mann-Whitney U = 8669.50, Z = -.068, p = .946 showed that there was no significant relation between the treatments where the superordinate category design label was provided and the treatments where this was absent.

Table 3

Descriptive Statistics Willingness To Pay per Treatment (in Euro's)

N M S.E. M SD Min. Max.

Treatment 1

Proving no label 62 50.58 3.78 29.75 0 150

Treatment 2

Providing the subordinate label 71 44.83 4.02 33.90 10 235

Treatment 3

Providing the design label 66 48.23 4.37 35.51 0 200

Treatment 4

Providing both subordinate and design label 65 52.29 5.27 42.48 10 200

All treatments 264 48.87 2.19 35.64 0 235

Additionally, a robustness check was done by excluding the respondents who might be less interested in the radically aesthetic innovative product. From this perspective, the differences in the means of the top 50% of the inserted willingness to pay values (above 39 euros) were only included in the analysis, see table 4. Again, a Kruskal-Wallis H test was run to determine if there were differences in the willingness to pay of

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

significant χ2(3) = .437, p = .932. Additionally, a Mann-Whitney test showed statistically that there was no significant differences in the top 50% scores between the groups where the superordinate category label design was absent and where this specific label was specified U = 2331.50, Z = -.356, p = .722. Thus, based on these findings it is hard to conclude whether providing the superordinate category label design resulted in a higher willingness to pay for a radically aesthetic innovative product, therefore these results do not provide support for Hypothesis 3b.

Table 4

Descriptive statistics Top 50% Willingness to pay per treatment (in Euro's)

N M S.E. M SD Min. Max.

Treatment 1

Proving no label 38 67.92 4.07 25.06 40 150

Treatment 2

Providing the subordinate label 31 70.74 6.68 37.17 40 235

Treatment 3

Providing the design label 36 69.42 5.93 35.57 40 200

Treatment 4

Providing both subordinate and design label 34 77.44 7.81 45.51 40 200

All treatments 139 71.27 3.06 36.04 40 235

Since there were no significant differences in the means of the different levels of treatments on willingness to pay, an additional regression analysis to examine the role of design acumen as a moderator was not relevant. However, to have an indication of the moderator role of design acumen, results from the descriptive statics were analysed. To make the analysis more straightforward and easier to interpret, a median split (4.50) was used as a breakpoint to divide the sample into low (46,6%) and high (53,4%) differential groups of design acumen (Iacobucci et al., 2015). Figure 3 shows that for respondents with low design acumen, providing the superordinate label design might increases their willingness to pay for a radically aesthetic innovative product. On

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Thesis Entrepreneurship and Management in the Creative Industries | University of Amsterdam | June 2016

54,00 Wi ll in gn es s T o P ay (I n E u ros ) 52,00 50,00 48,00 46,00 44,00 42,00 Figure 3

Moderating Role of Respondents’ Design Acumen on the Effect of the Design Label on Willingness To Pay (standard coefficients)

the contrary, providing the superordinate design label for respondents with high design acumen might result in a negative effect on their willingness to pay for a radically aesthetic innovative product. Nonetheless as previously mentioned, since there was no direct effect of the different treatments on willingness to pay, this moderating result is only suggestive and therefore not conclusive in terrestrial.

In summary, there was no overall significant effect of the different treatments on the respondents’ willingness to pay. Consequently a moderator analyses to investigate if the respondents’ design acumen positively moderates the effect of the superordinate category label design on their willingness to pay for a radically aesthetic innovative product was not applicable. In this line, Hypothesis 4b is not supported in this study.

Perceived incongruity. Given that people can successfully resolve low and moderate incongruity (Mandler 1982; Meyers-Levy and Tybout 1989; Peracchio and Tybout 1996), respondents should be quite accurate at mapping schema-relevant information and thereby score lower when the superordinate category label design was provided.

Low Consumer Design Acumen

High Consumer Design Acumen No Design Label Design Label

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