Mysteries of Pricing — Episode 2: Brevity is best

Episode 1 last Sunday explored the routine use of .99 and generated an enormous amount of feedback, the gist of which pointed out that since sales tax of varying amounts was invariably added, the actual price paid was invariably a non-round number and therefore the "employee-generated shrinkage" explanation proffered for pricing ending in .99 was DOA.

Now comes Alex Mindlin in the August 14 New York Times with a brief item about a new study, to be published in the September issue of the Journal of Consumer Research, showing that "each extra syllable in the price reduces the chances of it being recalled by 20%."

Here's Mindlin's piece.

For a Memorable Price, Trim the Syllables

Consumer researchers know that people are terrible at remembering store prices: two seconds after taking a product from a shelf, the average person has roughly a 50 percent chance of remembering how much it cost. But few researchers have examined why some prices are more memorable than others.

According to a new study, it is a matter of syllables. Each extra syllable in the price reduces the chances of it being recalled by 20 percent, according to the study, which will be published in the September issue of The Journal of Consumer Research [JCR]. In other words, someone faced with a $77.51 camera (eight syllables) and a $62.30 bookshelf (five syllables) is about 60 percent more likely to forget the camera’s price than the bookshelf’s, after half a minute.

“The way information goes from the environment to your memory, there is this phonetic loop which is a two-second buffer,” said Xavier Drèze, one of the study’s authors.

Hungarians are far better than Americans at recalling long prices; on average, they can recall 19 to 24 syllables with decent accuracy, while Americans can recall only 13. The authors suggested that this was because Hungarians speak 41 percent faster, both out loud and when repeating sounds to themselves “subvocally.”

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I am so ahead of the curve: I mean, how many syllables does "free" have?

It doesn't get much shorter than that.

When Shakespeare* wrote that "brevity is the soul of wit" he had no idea how much more was inherent in the concept.

Read the abstract of the forthcoming JCR paper here.

Bonus: that same link lets you download and print out a PDF version of the full paper.

A bit of intellectual arbitrage in play here: casual browsers of the JCR website get only the paper's title and subscribers ($145/year for four quarterly issues) most likely haven't even received their copies yet, but bookofjoe readers (all sixteen of you) get to enjoy the article right now — free.

How many syllables...?

*Name the play