Ever wonder why upgrade fever strikes? Researchers at the Yale School of Management have shown that the thrill of owning a new gadget fades – but that we rarely take that into account when buying it.
Yale professors Nathan Novemsky and Ravi Dhar asked shoppers to predict their enjoyment from products including plasma TVs, stereos, and digital cameras at different points in time, and found that even when people believe they will enjoy a product less in the future, they don't consider that when buying.
Basically, we're all a bit thick
Consumers were asked to consider two cars: a basic model and the same car with a sunroof for an extra £500. Before choosing, one group predicted how much they would enjoy the sunroof several months after purchase, while another predicted enjoyment at two points: immediately after purchase and several months later.
The two-prediction group accurately expected their enjoyment of the sunroof to diminish over time. The single-prediction group overestimated – their enjoyment level for the sunroof several months after purchase matched that of the two-prediction group immediately after purchase.
In the end, only 26 per cent of participants in the double-prediction group would have bought the car with the sunroof compared to 61 per cent in the single-prediction group. The moral of this tale? If you really want to buy that 50in plasma, don't think about it too much or you'll end up with a 26in CRT.
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