Selective Accessibility

What it is

Palmeira and Srivastava's 2013 paper in the Journal of Consumer Research is titled "Free Offer is Not a Cheap Product: A Selective Accessibility Account on the Valuation of Free Offers". It starts from a common promotion. A retailer offers a product for free, or at a low discounted price, together with a required purchase. The question is what the product is worth to the customer afterwards, once the promotion has been withdrawn.

The finding is that willingness to pay for the product after the promotion is higher when it was offered for free than when it was offered at a low, discounted price. The reasoning in the abstract has two parts. When a product is on promotion at a low price, that price is used as a natural anchor for estimating its value. When the product is offered for free, people are less likely to consider the product's value, and they are influenced instead by anchors such as the price of the focal purchase it came with. The authors set this against some earlier findings, concluding that a free offer does not devalue the product at all and, at a minimum, devalues it less than a low discounted price would.

The word selective refers to which pieces of information come to mind when a judgement is made. A low price makes the product's own worth easy to retrieve. A zero price leaves that retrieval switched off, and something else fills the gap.

A hypothetical illustration shows the shape of the claim. A shop sells a phone and offers a case free with it, and a second shop sells the same case at a token discount with a phone. After the promotions end, the case is priced at its normal level in both. The paper's finding is that people from the free group will tend to pay more for the case than people from the token-price group. The token price has told the second group what the case is worth. The free offer told the first group nothing, so their estimate was formed from other things, and the price of the phone was one of them.

The account therefore makes a prediction that differs from a common worry. The worry is that giving a product away teaches customers it has no value and makes them reluctant to pay later. Palmeira and Srivastava's abstract reports the opposite ordering for a free offer set against a low discounted price: the free offer did not devalue the product, and a low price devalued it more.

In effect

For a seller, the account explains why giving a product away alongside a purchase can be safer for the product's later price than discounting it deeply. A product that has been sold at a token price carries that token into the customer's idea of its value. A product that was free does not carry a price at all.

The account sits beside a 2006 finding by Sucharita Chandran and Vicki Morwitz that free promotions are more salient than monetary discounts, and so are less damaged by negative information about quality. Both papers describe free offers as drawing attention to the offer and away from the product's own value, which is why free can be strong and can be risky: it works partly because people stop thinking about worth.

The account also marks a limit on what a seller can claim. It concerns willingness to pay after a promotion has been withdrawn. A customer who can still see the product's regular price on the shelf next to the free offer has a ready anchor, and the abstract does not say whether the effect would survive that.

For a shopper, the account suggests a check. When something comes free with a purchase, ask what you would pay for it alone, because the offer may have kept that question from arising.

What it does not say

It does not say free offers are always good for a brand. The finding concerns willingness to pay after a promotion, and not whether the promotion earned or lost money.

It does not tell us how long the effect lasts, or how often a promotion can be repeated before the anchor changes. The abstract describes no such test.

It does not settle the mechanism behind the zero price effect itself. The 2007 paper by Kristina Shampanier, Nina Mazar and Dan Ariely names affect as the most likely account of why zero pulls harder than a small price. Selective accessibility is a different question, about what a free offer does to the value of the product afterwards, and the two can both hold.

It does not report effect sizes. This page was written from the paper's abstract and the paper was not read in full, so the studies, samples and magnitudes are not reported here, and the illustration above is hypothetical, not a description of the paper's materials.

Anchoring itself, the broader tendency for an early number to shape later judgements, is a separate and much more heavily studied effect. Selective accessibility is one way of explaining where the anchor comes from. The vault's page on anchoring covers the wider literature.

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