Increasing acceptance for flaws:

Increasing acceptance for flaws:

Creating a connection between

anthropomorphized products and the self through

endowment

Master Thesis Defense

July 5th, 2017

Michelle Binder

S3180778

First Supervisor: Dr. Jing Wan

Introduction and motivation

Relevance and importance of the topic of flawed products

• Conditioned consumers that need incentives to accept flaws  Change in product perception needed

• Discounts needed (The Economist 2016)  Reduced profitability

Theoretical background

Anthropomorphism

• Tendency to humanize non-human entities  ascribing intentions and consciousness (Epley, Waytz, and Cacioppo 2007)

• Brain activitiy similar (Gazzola et al. 2007)

• Moral circle (Sherman and Haidt 2011)  moral concern (Singer 1981)

• Humans = not perfect (Grant 2008) and liked better with flaws (Breines 2015) • Perfectionism (Hewitt and Flett 1991) • Apply knowledge from the social

world to objects (Kim and McGill 2011)

• Apply similar norms (Chandler and Schwartz 2010)

 Anthropomorphism can change the expectations towards a product!

Theoretical background

Endowment

• Possessions  endowment effect (Kahneman, Knetsch, and Thaler 1990)

• Close connection due to ownership and association between goods and the self (Belk 1988)

• Brain acitivity in similar regions for owned good and self (Kim and

Johnson 2014; Turk et al. 2011) • Possession and people part of the

extended self (Belk 1988)

• Self-determination theory =

incorporation and acceptance of flaws (Deci and Ryan 1985)

• Positive self-image (Cialdini and Trost 1989)  acknowledging flaws as

human (Haslam et al. 2005)

• Flaws seen as normal = character traits or part of the personality for ingroup (Koval et al. 2012)

 Framing of a product as a friend should lead to more tolerance of flaws as

natural features

Conceptual model

Attitude towards watches

Product Flaw No Flaw Anthropomorphism Present Absent Dependent measures Attitude

Likelihood to purchase or keep Monetary valuation

Endowment

Present Absent

Hypotheses

Hypothesis 1:

Anthropomorphizing a flawed product increases the positive attitude, likelihood to purchase or keep and monetary

valuation compared with its

non-anthropomorphized counterpart.

Hypothesis 2:

An individual endowed with a flawed product will demand a higher compensation to give it up compared to the value it has for the

non-endowed individual.

Hypothesis 3:

Within

anthropomorphized products, when there is endowment, consumers’ evaluations are increased particularly when the product is imperfect to at least the same level as the perfect product, or above.

Methodology (1): Research design

Between-subjects design:

2 (Anthro vs. No Anthro) x 2 (Seller vs. Buyer) x 2 (Flaw vs. No Flaw)

Manipulation scenarios

• Anthropomorphism (Aggarwal and McGill 2007) • Face

• Family framing (size) • Wording and pronouns

• Endowment imagery (Peck and Shu 2009) • Store setting: Examining product in store  Potential buyer

Methodology (2)

Data collection

via MTurk (created with Qualtrics)

Sample

409 participants (Average age: 37 years)

Analytical method

Full model ANOVA + adding in control variables • Mood (Lin et al. 2006)

• Attitude towards watches in general

• Price perceptions of MSRP (Munnukka 2008)

 2x2x2 ANCOVA for the 3 dependent variables

 2x2 ANCOVA for the exploratory DV

217 191

1

Results – H1

 Not supported for all three dependent variables: trends in other direction

Results – H2

 Supported for all dependent variables (at least with a trend): sellers focus more on positive aspects as buyers (Nayakankuppam and Mishra 2005)

Results – H3

 Trend supporting the hypothesis for monetary valuation only

4,00 4,50 5,00 5,50 Flaw No Flaw Attitude for a humanized and endowed product 3,00 3,50 4,00 Flaw No Flaw Likelihood for an anthropomorphized and endowed product 100 150 200 250 300 Flaw No Flaw Monetary valuation anthropomorphized and endowed product

( )

 Trend of anthropomorphism decreasing the extent of being bothered

(Grant 2008, Breines 2015)

 Trend of endowment increasing the extent of being bothered

Results – Being bothered by the flaw

Discussion

1. Remains a challenge to frame flaws positively

2. Anthropomorphism = rather negatively viewed:

• Might differ between different product types

• Situational needs (functional vs. emotional; Miesler 2011) • Different associations (Miesler, Leder and Herrmann 2011)

• Values of a watch = serious, reliable; Anthro = childish or dishonest • Uncanny valley theory

(Mori, MacDorman, and Kageki 2012)

• Different levels of sophistication and elegance (Puzakova and Aggarwal 2015)

• Feeling of being watched

(Hill 2012; Bateson, Nettle and Roberts 2006)

3. Endowment imagery  Interaction of endowment and flaw

Implications

• Results add to theory: negative impact of anthropomorphism possible • All concepts have to work in order for the whole manipulation to work

For practice

• Retailers:

1. Either offer discounts or perfect products

2. Endowment  persons overvalue the product • Samples

• Online shopping

• Marketers:

• Only one product type and model • 80%: „high-priced product“

• Attitude watches rather low

Limitations

• Particular anthropomorphism manipulation  miscalibrated • Lack of qualitative data

(associations)

• Extend: the literature on anthropomorphism • Associations • Situational needs • Product categories

Future research

• Gender differences likelihood to purchase or keep

• Gender fit different across anthropomorphism conditions

• Examine: flawed products primed with

combination of humanization and closeness Manipulation of the combination framing in lab

or field (advantages for endowment)

Being bothered by the flaw

• When Median split of both endowment and anthropomorphism

manipulation check is used instead of the independent variables

(conditions), both anthro and endowment as well as the combination

leads to the respondent being less bothered

4,00 4,50 5,00

Endowment No Endowment

Extent of being bothered by anthropomorphized flawed product (IVs) 4,00 4,50 5,00 Endowment No Endowment

Extent of being bothered by anthropomorphized flawed

Manipulation checks

Anthropomorphism

Mean Anthro = 2.25 (SD

= 1.40)

Mean No Anthro = 1.95 (SD

= 1.22)

F

(1, 408) = 5.17, p = .023

Endowment

Mean Endowment = 4.42 (SD

= 1.64)

Impact of the control variables

Attitude

Mood (+): F(1, 408) = 20.002, p = .000, B= .236

Attitude towards watches in general (+): F(1, 408) = 5.833, p = .016, B= .085 Perception of MSRP (-): F (1, 408) = 4.849, p = .028, B= -.143

Likelihood

Mood (+): F (1, 408) = 24.217, p = .000, B= .246

Attitude towards watches in general (+): F(1, 408) = 12.306, p = .001, B= .227

Monetary valuation

Mood (+): F(1, 408) = 8.931, p = .003, B= 10.155

Perception of MSRP (-): F(1, 408) = 19.043, p = .000, B= -18.288

Being bothered