Time or Money?

*Cassie Mogilner and Jennifer Aaker at Stanford Graduate School of Business, developed a series of experiments to understand what is the reference to sell something top people: is it money or time? The “Lemonade Stand” was one of those experiments.

They designed 2 different banners and made the kids do the sales of the lemonade:
“Spend a little time and taste our lemonade”“Spend a little money and taste our lemonade”

391 people between ages of 14 and 50 stopped to buy lemonade. The price of one glass of lemonade was between 1 and 3 dollars. In other words “ whatever you feel like paying” model. Right after the lemonade sale, the customers filled in a survey form. For the banner with time, the rate of stopping was 14% and the average price paid for a lemonade was 2.50$, while for the banner with money the rate of stopping was 7% and the average price paid for a lemonade was 1.38$.

The philosophy that promoted time attracted more customers and made more money than the one promoted money.

The researches reviewing the data agreed that promoting time builds a more personal relationship than promoting money and they are trying to see how it will affect the shopping instinct of people to buy an iPod, tv, trousers, perfume etc if messages of time and money was communicated by performing the other 4 experiments in their labs.

The reviews show that when there is a personal connection is established, people tend to buy more and spend more .The Time message connects with experience in human minds and this experience recalls the time that the person have spent/will spend with the product and creates an automatic personal connection .Money does not have the same affect.

On the other hand, for the products not-really-needed like luxury cars, this case invokes the “having” instinct in human nature. For some people, may be not many, this overcomes” experience”.

  • If we know about our target customers well enough we can direct them towards shopping by using the time/experience and hidden personal link in it.
  • We can use money triggers for the ones who act on prestige and owning.
  • If we do not recognize our target customers well enough, then we can direct them by using emotional and personal communication tools, stay away from the materialist triggers that associate with money.

The e-commerce sites, always promoting the cheapest and the most advantageous, do ever take the personal connection seriously?

*Cassie Mogilner and Jennifer Aaker (2009) “The Time versus Money Effect: Shifting Product Attitudes and Decisions through Personal Connection” Journal of Consumer Research, 36 (August), 277-291.

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