Payment method and perceptions of ownership
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Payment method and perceptions of ownership Bernadette Kamleitner & Berna Erki
Published online: 25 August 2012 # Springer Science+Business Media, LLC 2012
Abstract How consumers pay influences how they feel about a transaction. In particular, paying by card has been argued to have an effect on the perception of cost, making it less salient and painful. We propose and show that payment method also influences how consumers feel about the acquired good. Specifically, we focus on effects of the payment method on psychological ownership, i.e., the perception of an object as “mine.” We propose that cash payment results in stronger psychological ownership because it influences the extent of perceived investment in an object. We provide evidence for the proposed effect from field and laboratory settings. Results of a longitudinal exit survey and an experiment show that cash payers report higher levels of immediate psychological ownership than card payers. However, this effect seems to depend on the meanings associated with a payment method. Asian students (who associate credit card payment with investment and debt) do not exhibit this effect. Moreover, the initial boost in psychological ownership seems to be comparably short-lived. While those paying in cash experience no further increase in psychological ownership over time, those paying by card do. Keywords Payment method . Psychological ownership . Credit card . Attachment . Behavioral intention
1 Introduction Whether consumers pay by card or in cash matters. Previous evidence (e.g., Prelec and Simester 2001; Soman 2003) suggests that payment method influences the perception of the amount paid. Payment by card may be hedonically advantageous B. Kamleitner (*) Vienna University of Eocnomics and Business, Augasse 2-6, 1090 Vienna, Austria e-mail: [email protected] B. Erki Queen Mary, University of London, Mile End Road, London E1 4NS, UK
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Mark Lett (2013) 24:57–69
(i.e., reducing the “pain of payment”) but economically disadvantageous (i.e., leading to an underestimation of real cost). Consumer transactions however consist of both payment and object acquired. Behavior towards an object and its seller is a function of how consumers feel about both aspects. While the literature indicates an effect of payment method on cost perception, it holds no such empirical evidence with regard to the acquired good. Yet literature on mental accounting suggests that costs and benefits of a transaction can be reciprocally linked so as to influence each other’s perception (e.g., Kamleitner and Hölzl 2009). We extend this notion by examining how payment method influences a specific object perception, the extent to which psychological ownership is experienced by the consumer immediately after purchase. We investigate the existence of such a relation and explore its robustness in terms of temporal stability and susceptibility to variations in the meanings associated with payment methods. This paper is structured as follows. We first review existing literature on the effe
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