When cheap isn't the same as not expensive: Generic

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Key words: Price terms; negation; antonym; psycholinguistics; cheap; expensive. ... Generic price terms can also be useful when referring to prices that comprise ...
When cheap isn’t the same as not expensive: Generic price terms and their negations

BERT WEIJTERS ELKE CABOOTER HANS BAUMGARTNER

Accepted for publication in the Journal of Consumer Psychology

Bert Weijters ([email protected]) is associate professor of market research at Ghent University, Department of Personnel Management, Work and Organizational Psychology; Dunantlaan 2, 9000 Ghent, Belgium. Elke Cabooter ([email protected] LEM CNRS-8179) is assistant professor of marketing at IESEG School of Management, Rue de la Digue, Lille, France. Hans Baumgartner ([email protected]) is the Smeal Professor of Marketing in the Smeal College of Business at The Pennsylvania State University, 482 Business Building, University Park, PA 16802. Correspondence: Bert Weijters.

Acknowledgements: The authors thank Kristof Geskens for his help in collecting data for Study 1b and Study 5 and for his feedback on an earlier version of the manuscript.

When cheap isn’t the same as not expensive: Generic price terms and their negations

Abstract

Generic price terms such as cheap, not expensive, not cheap, and expensive are used frequently in marketing, but little is known about how consumers interpret them. In typical consumer contexts, in which lower prices are preferred, we find that not cheap means essentially the same as expensive (i.e., not cheap = expensive). By contrast, not expensive does not mean the same as cheap, in that cheap is associated with lower prices (i.e., cheap < not expensive). As an implication, in a consumer survey we find different response distributions for rating scales that are anchored with endpoint labels of not expensive vs. expensive as compared to cheap vs. expensive or cheap vs. not cheap (the latter two are equivalent). Furthermore, although cheap is associated with lower prices than not expensive, this does not necessarily translate into higher preferences for options that are described as cheap (vs. not expensive), because cheap may also evoke negative quality perceptions. Finally, we demonstrate an interesting reversal in the way price terms are interpreted: when higher prices are preferred, cheap is equal to not expensive (i.e., cheap = not expensive), whereas not cheap is associated with lower prices than expensive (i.e., not cheap < expensive). Key words: Price terms; negation; antonym; psycholinguistics; cheap; expensive.

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Introduction

With the increased emphasis on value and the important role accorded to price as a determinant of value, many researchers in marketing have studied how consumers process price information and how information about prices is being communicated to consumers (Kan, Lichtenstein, Grant, & Janiszewski, 2014). Prices can be referred to by using actual monetary amounts (e.g., $15.99), but often consumers cannot remember the exact price of a product and therefore use generic price terms such as cheap or expensive instead (Monroe & Lee, 1999). Generic price terms can also be useful when referring to prices that comprise multiple products (e.g., an assortment, cost of living in a given region or city), prices that fluctuate over time (e.g., fresh produce, real estate), prices that depend on the specifics of the order (e.g., a meal at a restaurant), or prices that involve different currencies (e.g., travel, tourism). As a consequence, generic price terms are ubiquitous in marketing. While prices expressed in monetary values are relatively unambiguous (Kan et al., 2014), price terms such as (not) cheap or (not) expensive are less precise. Cheap and expensive are considered to be antonyms that presumably represent opposite poles of a bipolar continuum (Horn, 1989). But despite their widespread use, the meaning of their negations, not cheap and not expensive, is somewhat equivocal. Customer reviews on web sites such as Tripadvisor.com commonly characterize restaurants with descriptions such as ‘good food, not cheap’ or ‘tasty and not expensive’. Does not cheap equal expensive, and does not expensive equal cheap? If the negated price terms are equivalent to their antonyms, why would consumers refer to a restaurant as being not expensive rather than cheap? And should marketers take notice when their product or service is called not expensive/not cheap rather than cheap/expensive? Despite a thriving

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literature on price perception (Adaval & Monroe, 2002; Alba, Mela, Shimp, & Urbany, 1999; Hamilton & Chernev, 2013), these questions have not been answered. This is unfortunate, since marketers need to know how consumers interpret generic price terms and their negations so that they can extract accurate information from these terms (e.g., when the terms are used in consumer reviews) and apply them appropriately in their communications and market research. The current research aims to disambiguate the meaning that consumers attach to the words cheap, not cheap, expensive and not expensive. Drawing on the psycholinguistic literature, we distinguish four plausible patterns of interpretation describing the relative ordering of the four price terms in consumers’ minds (e.g., cheap < not expensive < not cheap = expensive). In a series of studies we show that in typical consumer contexts (particularly when low prices are preferred), not expensive is different from cheap, whereas not cheap is the same as expensive in the sense that it is associated with similar price levels (i.e., cheap < not expensive < not cheap = expensive). But if high prices are desirable, not expensive is the same as cheap, whereas not cheap is no longer the same as expensive (i.e., cheap = not expensive < not cheap < expensive). In the following section we develop our conceptual framework about the interpretation of generic price terms by drawing on extant psycholinguistic theories and report five empirical studies that support our theorizing and also demonstrate several practical implications of consumers’ asymmetric interpretation of generic price terms. The paper ends with a discussion of the findings and implications for future research.

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Conceptual development

Price and generic price terms

Despite the centrality of price in marketing, little is known about the meanings that consumers ascribe to generic price terms such as (not) cheap and (not) expensive. Generally speaking, consumers are expected to use these terms to refer to prices below or above a reference price. Reference prices are standards against which the purchase price of a product is judged (Mazumdar, Raj, & Sinha, 2005; Monroe, 1973). Extant research in this domain suggests that internal reference prices are formed mainly through earlier experiences (Mazumdar et al., 2005). External reference prices can complement the internal reference price or can serve as a substitute if no internal reference price is available (Mazumdar et al., 2005). Reference prices usually serve as the basis for judging the attractiveness of prices (Winer, 1986). In general, any price below (above) the reference price tends to be perceived as (un)attractive by consumers. However, the relation between exact monetary prices and subjective perceptions based on imprecise verbal labels remains unclear. Based on an extensive review of the reference price literature, Mazumdar et al. (2005) indicate that only limited research exists on the mental representation of (reference) prices, which suggests a need to more closely investigate how consumers convert numeric price estimates into verbal price evaluations and vice versa. In sum, for a variety of reasons, generic price terms such as (not) cheap and (not) expensive are used quite frequently by consumers and there is a need to understand what these terms mean. Below, we will review what we know about the meaning of antonyms and their negations, and how this applies to the antonyms cheap-expensive and their negations. In

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particular, we will discuss alternative patterns of how the terms cheap, not expensive, not cheap and expensive map onto the price continuum.

How generic price terms map onto the price scale: Four possible patterns The adjectives cheap and expensive are gradable antonyms (also called scalar antonyms), which are defined as words that name opposite ends of a single dimensional scale (Lehrer, 1985). The psycholinguistic literature on gradable antonyms such as cheap versus expensive suggests four possible patterns according to which the four generic price terms cheap, not expensive, not cheap, and expensive can be mapped onto the price continuum (Colston, 1999). The mapping patterns are displayed graphically in Figure 1A and are referred to as dual fusion, dual mitigation, upper fusion and lower fusion, respectively. Fusion refers to the fact that two expressions may be mentally ‘fused’ to mean the same thing (e.g., not cheap is equivalent to expensive). In contrast, mitigation signifies that one expression is interpreted as having a more ‘mitigated’ (i.e., less extreme) meaning than another expression (e.g., not cheap connotes a lower price than expensive).

Dual Fusion In the dual fusion pattern, not expensive is approximately the same as cheap, and not cheap is approximately the same as expensive. If the particle ‘not’ were simply a logical operator, one would expect the negation of an adjective to be equivalent in meaning to the antonym of the adjective (e.g., not expensive = cheap). Colston (1999) refers to this pattern as the literalist account of negation. Support for this account comes from studies showing that people sometimes spontaneously recode negated adjectives as the antonym of the adjective (e.g.,

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‘not guilty’ is recoded as ‘innocent’). Mayo, Schul, and Burnstein (2004) call this the fusion model of negation, because the negation operator and the adjective are mentally represented as (i.e., fused into) the antonym of the adjective. If fusion occurs at both ends of the continuum, dual fusion results. However, as a general model of how language users interpret negated terms and their antonyms, the dual fusion account of negation has been found to be deficient. First, negations are more difficult to process than affirmations (Carpenter & Just, 1975), so it seems unlikely, from a pragmatic view, that language users would adopt complex and potentially more ambiguous terms when simpler expressions are readily available (Huang & Snedeker, 2009). Second, although some researchers have argued that one may expect dual fusion to be true for antonym pairs that are mutually exclusive and collectively exhaustive (such as dead versus alive, for which not dead = alive and not alive = dead), dual fusion need not hold for gradable antonyms such as cheap and expensive (Paradis & Willners, 2006). The reason is that these antonyms are not mutually exclusive. They are contraries rather than contradictories (Horn, 1989), which means that they cannot both be true, but they can both be false (see also Fraenkel & Schul, 2008; Harris, 1973; Hatzivassiloglou & McKeown, 1995; Lehrer, 1985). This implies that, even from a merely logical perspective, not cheap (not expensive) is not necessarily the same as expensive (cheap). In sum, although dual fusion is an interpretation that may be relevant for some adjectives (e.g., dead versus alive), it is not expected to be an ordering that applies to the generic price terms (not) cheap and (not) expensive.

Dual mitigation From a pragmatic point of view, language users are expected to use negations only if they are useful in some way (Colston, 1999). One possibility is that speakers intentionally violate

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Grice’s (1975) maxims of quantity and manner (which imply that one should say neither too much nor too little, and express things clearly) because they want to express that ‘not hot’ is less extreme than ‘cold’ and that ‘not cold’ is less extreme than ‘hot’. In other words, negated adjectives are not equivalent to the antonym of these adjectives and are used purposely to communicate less extreme meanings. This is referred to as mitigation. If negations lead to mitigated meanings at both ends of an underlying dimension, dual mitigation occurs (see Figure 1A). There seem to be only a few contexts in which generic price terms are likely to be interpreted according to the dual mitigation pattern. An example might be a situation in which somebody uses the four terms to refer to the relative ranking of four different products in terms of price. In this case there could be a strong suggestion that cheap, not expensive, not cheap, and expensive refer to different positions on the price continuum, and the most likely ordering would be the one implied by the dual mitigation hypothesis. However, price terms are probably not commonly used in this way. We will therefore not consider this pattern in the sequel. Rather, our focus is on the more common type of situation in which price terms are used in evaluative descriptions of the price of a particular product or service, for instance in customer reviews (Moon & Kamakura, 2017). Both dual fusion and dual mitigation are symmetric accounts with respect to the meaning of the two types of negations (not cheap is the same as expensive and not expensive is the same as cheap, or they are both less extreme than expensive or cheap). Interestingly, there are strong reasons to expect that consumers will interpret generic price terms in an asymmetric fashion, which is consistent with the fact that people are known to process evaluative information in an asymmetric fashion (Taylor, 1991). The two remaining patterns take this into account and predict

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an asymmetric fusion pattern in which fusion occurs at one pole of the price continuum (usually the upper or expensive end of the continuum).

Upper fusion Our primary hypothesis is that in most circumstances consumers will interpret generic price terms according to the upper fusion pattern: When something is not cheap, it means it is expensive (i.e., not cheap = expensive). But when something is not expensive, it is between cheap and expensive (i.e., cheap < not expensive < expensive). Combining the two propositions, we get cheap < not expensive < not cheap = expensive. Two different conceptual frameworks support this prediction. To begin with, the linguistic positive bias model developed by Rozin, Berman, and Royzman (2010) states that “negated positive adjectives tend to have a negative valence, whereas negated negative adjectives tend to be neutral in valence” (p. 538, italics in the original). In other words, when something is not good, it means it is bad, but when something is not bad, it is between good and bad. Rozin et al. studied 8 adjectives with clear evaluative implications (i.e., pleasant, sad, dirty, disgusting, bad, sincere, pure and beautiful), and found that the negation of positive words was more likely to have an extreme meaning than the negation of negative words. How does this apply to cheap vs. expensive? In general, one may expect that, in the context of price, cheap is the pole of the price continuum with the more positive evaluation, as implied by the law of demand: all other factors being equal, as the price of a good or service increases, consumer demand for the good or service will decrease, and vice versa. The reason is that consumers’ opportunity cost to acquire that good or service increases, and they must make more tradeoffs to acquire the more expensive product, hence consumers’ preferences for lower

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prices (Nicholson & Snyder, 2011). This also aligns with the idea of the predominantly negative role of price studied in the behavioral pricing literature (Lichtenstein, Ridgway, and Netemeyer 1993) and consumers’ experience of the ‘pain of paying’ (Prelec & Loewenstein, 1998). Assuming that cheap is positive and expensive is negative, Rozin et al.’s prediction is consistent with upper fusion in the case of cheap and expensive (so cheap < not expensive < not cheap = expensive). This prediction can be further corroborated and extended based on the linguistic concept of markedness. Pairs of gradable antonyms often consist of a member that is marked relative to the other, unmarked member in the pair (Fraenkel & Schul, 2008; Harris, 1973; Hatzivassiloglou & McKeown, 1995; Lehrer, 1985). Although markedness is a complex and even contested construct, the unmarked member is typically described as normal and positively valued, whereas the marked member is defined in terms of deviation from the unmarked member (Fraenkel & Schul, 2008; Lehrer, 1985). The most important implication of markedness for the present purposes, as shown by Fraenkel and Schul (2008), is the following. For antonym pairs that span a continuum (i.e., contraries), the negation of the marked member is used to express a more moderate (or mitigated) meaning than the unmarked member (mitigation), whereas the negation of the unmarked member has the same meaning as the marked antonym (fusion). Assuming that lower prices are generally desirable to consumers, in the antonym pair cheap-expensive, expensive is the marked member, and the markedness model leads to the same prediction as the linguistic positive bias model. That is, cheap < not expensive < expensive = not cheap. The reason, presumably, is that since the marked member is defined in terms of deviation from the norm, negating the marked member implies non-deviation; the absence of deviation from the norm is psychologically equivalent to normality. In other words, not expensive means normally

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priced. In contrast, negating the unmarked member implies a negative deviation from normality, and negative information is psychologically more salient and more heavily weighted. So, not cheap means worse than expected (i.e., expensive).

Lower fusion Although markednesss researchers have acknowledged that contextual factors and pragmatic considerations can modify the evaluative meaning of adjectives (Fraenkel & Schul, 2008; Harris, 1973; Hatzivassiloglou & McKeown, 1995; Lehrer, 1985), in general evaluative tone has been viewed as an invariant property of antonym pairs. Furthermore, in the linguistic positive bias model evaluative tone is explicitly regarded as a fixed attribute of a given adjective. However, for at least some adjective pairs, the evaluative tone of the two poles that are contrasted may not be invariant. If evaluation is driving the asymmetry in mitigation and fusion, it is possible that in some situations fusion may occur at the low end of the price continuum (i.e., lower fusion). Thus, we propose that lower fusion (rather than upper fusion) occurs when higher prices have positive evaluative tone. Although price is often perceived in a negative role, there are situations in which higher prices may be preferred. Two well-known cases are when higher prices are used as a signal of quality and when higher prices can be instrumental in conveying social status (de Langhe, van Osselaer, Puntoni, & McGill, 2014; Griskevicius, Tybur, & Van den Bergh, 2010; Lichtenstein, Ridgway, & Netemeyer, 1993). There are also other situations in which consumers may prefer higher to lower prices, such as when one is the recipient rather than the giver of a gift. In all of these cases, it is likely that expensive rather than cheap will be the desirable pole of the low to high price continuum. We therefore expect a reversal of the negation asymmetry, such that when

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low prices are desirable, upper fusion holds, whereas when high prices are desirable, the interpretation of generic price terms follows lower fusion, as depicted in figure 1B.

Summary of predictions and overview of empirical studies Summing up, we propose that since consumers typically prefer lower prices, upper fusion is the most common interpretation of generic price terms such that cheap < not expensive < not cheap = expensive. The most immediate implication of this prediction is that price estimates for products described using different generic price terms will correspond most closely to the upper fusion pattern (see figure 1A). Two other implications will be considered as well. First, when studying price perceptions using rating scales bordered by different generic price terms, the results may vary depending on how the scale endpoints are labeled. In particular, whether the upper endpoint of a scale is labeled not cheap or expensive should be immaterial since these terms have the same meaning. However, since not expensive has a more moderate meaning than cheap, respondents should be more likely to endorse the lowest response category of a rating scale when the endpoint is not expensive rather than cheap. The reason is that respondents are more likely to choose less extreme response categories. Second, when recalling information involving generic price terms (e.g., from an online review), we expect that not cheap is more likely to be remembered as expensive, whereas not expensive is less likely to be remembered as cheap. Finally, in line with our hypothesis about the context dependence of consumers’ interpretation of generic price terms, we anticipate that in situations where higher prices are

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desirable, fusion will occur at the lower end of the price continuum such that cheap = not expensive < not cheap < expensive (i.e., lower fusion). We report five (sets of) studies to provide support for our predictions. In study 1 (consisting of studies 1A and 1B) we empirically test our hypothesis that upper fusion will be used for interpreting generic price terms and their negations when low prices are preferred (the typical situation). In study 2 we demonstrate that the asymmetry has implications for consumer surveys, as we find different response distributions for rating scales that are anchored with endpoint labels of not expensive and expensive as compared to scales bordered by cheap vs. expensive or cheap vs. not cheap (the latter two are equivalent). In study 3, we provide evidence that, when recalling price terms used in customer reviews, fusion is most likely to happen for not cheap (rather than not expensive) so that not cheap is more likely to be recalled as expensive, whereas there is little evidence that not expensive is recalled as cheap. In study 4 we demonstrate that while cheap is associated with lower prices than not expensive, it may also carry negative associations of lower quality. Finally, in study 5 we explicitly manipulate the desirability of low and high prices and test the prediction that fusion occurs for the pole opposite to the positively evaluated end of the price continuum (see figure 1B).

Study 1A

The aim of Study 1A is to test whether negation has a different effect on cheap than on expensive and, if so, whether upper fusion holds, consistent with the linguistic positive bias and markedness models. To examine this research question, we measured and compared the

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monetary price values that people associate with the generic price terms (not) cheap and (not) expensive.

Method

We collected data from the Dutch online panel of a global panel provider (N = 399), with quotas for gender and age (49.6% women; average age 35.6, SD = 11.4, with a range of 16 to 55 years). The questions of interest for the price perception experiment were attached to a survey about online and offline music consumption. Respondents answered price-related questions for four music offerings: a music album on CD, an MP3 song, a monthly subscription fee for Spotify Unlimited (a music streaming service which offers unlimited online access to the complete Spotify music catalogue, free of advertising), and a monthly subscription fee for Spotify Premium (which offers unlimited access, plus the possibility to store music offline on several devices). For each of these four offerings, respondents reported their perceptions of the reference price level (i.e., the normal or regular price) and what they would consider cheap, not cheap, expensive or not expensive. Respondents were randomly assigned to one of the four generic price terms in a simple four-condition between-participants experiment (with four replications as every respondent rated all four products). The questions used dropdown boxes with prices in EURO (ranging from €0 to €50 in steps of €1 for CD’s, from €0 to €10 in steps of €.20 for MP3’s, and from €0 to €25 in steps of €.50 for the Spotify subscription fees).

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Analytic approach In several of our studies (studies 1A, 1B and 5), we aim to assess how well each of the proposed patterns of interpreting generic price terms (dual fusion, dual mitigation, upper fusion, lower fusion) fits the data (see Figure 1A). Instead of comparing individual mean price estimates in a piecemeal fashion, a preferred approach is to directly compare the entire patterns as a whole. This can be done within a Structural Equation Modelling framework as follows. In the dual mitigation model, all four mean price estimates are expected to differ (Mcheap < Mnot expensive < Mnot cheap < Mexpensive), so the model in which the four means are freely estimated should be the preferred model. Since all four means are estimated, this is the least restrictive model and, in fact, this model has zero degrees of freedom. Lower fusion (Mcheap = Mnot expensive < Mnot cheap < Mexpensive) and upper fusion (Mcheap < Mnot expensive < Mnot cheap = Mexpensive) each impose one restriction on the means, thus each model has one degree of freedom per dependent variable. In the current study, all degrees of freedom need to be multiplied by four, since respondents gave price estimates for four different products (MP3s, CDs, and two Spotify subscriptions). The lower and upper fusion models cannot be statistically tested against one another directly (because they are not nested), but they can be compared with the dual mitigation model. If restricting two means to be equal does not significantly decrease the fit of the model, this provides support for the more restrictive and more parsimonious model (either lower or upper fusion); in contrast, if the deterioration in fit is substantial, the more general dual mitigation is supported. The dual fusion model (Mcheap = Mnot expensive < Mnot cheap = Mexpensive) imposes two restrictions on the means and thus has 2 degrees of freedom per dependent variable (8 in the present case with four products). This model is nested in all of the foregoing models and its fit can thus be directly

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compared to that of the other models. If dual fusion is supported, the model with two restrictions should fit as well as the other models, but this is not expected to be the case. For completeness, we also test a model in which all means are restricted to be equal (the null model). All four models of interest are expected to be superior to the null model. For each fitted pattern, we report the chi-square statistic and the Bayesian Information Criterion (BIC) (Schwarz, 1978). The chi-square test yields results that are statistically equivalent to testing planned contrasts on pairs of means, but it is more general because (a) it can handle more complicated contrasts (multiple restrictions on the means can be imposed and tests for several dependent variables simultaneously can be conducted), (b) it enables a direct comparison of different interpretational patterns of generic price terms and a relative ranking of these patterns, and (c) it avoids the limiting ANOVA assumption of equality of variances (and, in the case of the study described here, equality of covariances) across experimental conditions. The advantage of the BIC is that it allows the comparison of non-nested models, so all four models can be compared directly. The pattern that shows the lowest BIC value when fitted to the data is selected as the preferred pattern. In our model comparison analyses, we include meancentered reference prices as control variables in order to account for individual differences in absolute price estimates.

Results and discussion Figure 2 shows the observed means and fitted means (with standard errors) for the current study. Table 1 reports the chi-square and BIC values for all pattern fitting studies, including Study 1A. The mean price levels associated with the four generic price terms are in line with upper fusion (see Figure 1), which supports the linguistic positive bias and markedness models.

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The fit statistics reported in Table 1 demonstrate that lower fusion and dual fusion are clearly inconsistent with the data, and that the more parsimonious upper fusion model fits as well as the unconstrained dual mitigation model. Upper fusion also has the lowest BIC value, which implies that it is the preferred model for these data.

Study 1B

The aim of study 1B is to investigate whether the negation asymmetry found with Dutch respondents (in study 1A) also holds for English-speaking consumers, such that not cheap is the same as expensive but not expensive indicates a higher price than cheap. In addition, we explore whether inexpensive (which has no counterpart in Dutch) is closer to cheap or not expensive. Adding the affix ‘in’ to expensive (called affixal negation) is another way to negate expensive, but it is possible (and indeed likely) that the term has been lexicalized and thus is no longer mentally processed as a negation.

Method

A sample of US MTurk participants (N = 304, 52.0% female, mean age 36.6, SD = 12.1, with a range of 19 to 68 years) indicated their reference price for an MP3 download: “Please imagine you want to legally download a song (e.g., in MP3 format). What would you consider a normal price for this?” The question was followed by a drop-down box with prices ranging from 0.00$ to 2.50$ in steps of .10$. Second, respondents were randomly assigned to one of five versions of the question “What price would you describe as expensive (N = 60) / not expensive

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(N = 69) / inexpensive (N = 59) / cheap (N = 67) / not cheap (N = 49)?” This was followed by the same drop-down box as for the reference price question. Initially, the experiment had an additional condition using the price term ‘not inexpensive’ (N = 57), but we excluded this condition because the data in this condition showed many inconsistent responses (Swain, Weathers, & Niedrich, 2008), which is presumably due to the fact that ‘not inexpensive’ is seldom (if ever) used and difficult to understand due to the complicated double negation.

Results and discussion

The results of Study 1A (which was run in Dutch) were replicated in English (again controlling for mean-centered reference price). The BIC values and chi-square statistics reported in Table 1 show that the data conform to upper fusion. In other words, as in Study 1A, we found that not cheap is equivalent to expensive, whereas not expensive is associated with higher prices than cheap. An additional finding is that the monetary values associated with inexpensive are situated in between those associated with cheap and not expensive. Figure 3 displays the mean price levels corresponding to each of the five price terms.

Study 2

To cross-validate our previous findings, while demonstrating an implication for questionnaire-based research, in this study we investigate how the negation asymmetry found in the previous studies affects responses to price perception rating scales that use alternative labels for the endpoints (see Fraenkel & Schul, 2008, Experiment 2, for a similar idea). In particular,

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we compare rating scales that have anchors of cheap versus expensive, cheap versus not cheap, and not expensive versus expensive. If generic price terms are interpreted according to upper fusion, we expect that the endpoint labeled not expensive will be perceived as less extreme than the endpoint labeled cheap. As a consequence, when respondents rate products with relatively low prices, they will be more likely to use the most extreme scale positions referring to lower prices when the endpoint is labeled not expensive rather than cheap. The reason is that less extreme response options are more readily endorsed because they are less exceptional (de Langhe, Puntoni, Fernandes, & van Osselaer, 2011; Weijters, Baumgartner, & Geuens, 2016). In contrast, the endorsement rates for the scale positions referring to higher prices should not differ regardless of whether the endpoints are labeled not cheap or expensive, because these terms are equivalent in meaning and therefore equally extreme. Method We collected data from a sample of Dutch-speaking members of a global online panel. The current study was part of a longer survey on several food-related topics. Since the product category of interest was beers consumed at a bar, we included only respondents who had visited a bar in the last three months prior to the survey and who said they at least sometimes ordered beer when visiting a bar (i.e., respondents who indicated ‘no, never’ in response to the question ‘do you sometimes order beer when visiting a bar?’ were excluded from participation). In the resultant sample (N = 557), 56.4% were male, the average age was 41.7 years (SD = 12.8), and 45.6% of participants had enjoyed a higher education. Respondents were asked to imagine themselves visiting a bar. They then rated (in random order) three price levels for a beer (25cl draft of the market leader brand): €1.60, €2.00, and

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€2.40, which corresponds to below-average, average and above-average prices at the time the study was conducted. Respondents were randomly assigned to one of three alternative sevenpoint rating scales in which the endpoint labels were varied: cheap vs. not cheap, cheap vs. expensive, and not expensive vs. expensive. The orientation of the rating scale (lower price term on the left- versus right-hand side of the scale) was counterbalanced (and did not interact with the effect of interest, p > .10). Before analyzing the data, we converted participants’ ratings so that the higher price term (i.e. expensive or not cheap) always anchored the high end of the scale. Results and discussion Table 2 reports the response distributions for the three scenarios (within-participant, beer priced at €1.60, €2.00 or €2.40) and the three rating scale formats (between-participants, cheap vs. expensive, not expensive vs. expensive, and cheap vs. not cheap). We anticipated that we would observe differences in response distributions for the lowest price level (€1.60), because respondents were expected to rate lower-priced beers differently depending on whether the lower end of the scale was labeled cheap or not expensive. Consistent with this expectation, in the lowprice scenario (€1.60), the lower endpoint was selected more frequently when it was labeled not expensive (41.8% of responses) than when it was labeled cheap (25.3% and 28.9% of responses; both are significantly different from not expensive, p < .05; see Table 2). When the endpoint was labeled cheap, the second to lowest response option was selected more frequently (32.8% or 32.1%) than when the endpoint was labeled not expensive (21.2%, p < .05). This supports the notion that cheap is perceived as more extreme (i.e., cheap is associated with lower prices) than not expensive. None of the other response frequencies varied significantly between alternatively labeled rating scales. In particular, not cheap and expensive did not attract significantly different

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proportions of responses in any of the price scenarios (p > .10), which is consistent with our expectation that expensive and not cheap are equivalent in meaning. In sum, when conducting research dealing with consumers’ price perceptions, scales with endpoint labels of cheap versus expensive and scales with endpoints labels of cheap versus not cheap can be used interchangeably (assuming low prices are preferred). However, scales with endpoint labels of not expensive versus expensive may lead to different results, simply because not expensive has a more moderate meaning than cheap, and respondents are more likely to endorse positions on a rating scale that are less extreme. One specific implication of this finding is that results from studies in which different endpoint labels of price perception measures are used should only be compared when the rating scales used in these studies are comparable. This is the case for expensive vs. cheap and not cheap vs. cheap, but not for expensive vs. not expensive.

Study 3 Generic price terms and their negations are often used in customer reviews. In this study, we investigate how such price terms in customer reviews are recalled by consumers. More specifically, our first objective in Study 3 is to provide convergent evidence for the upper fusion model by means of a task in which consumers have to recall information from a customer review in which a generic price term was used. We are mainly interested in whether or not fusion occurs, where fusion in the present context means that the negation of a term is mentally coded as its antonym (Mayo et al. 2004). To this end, we compare the likelihood that not cheap is mentally recoded as expensive with the likelihood that not expensive is recoded as cheap. Our expectation is that the former will happen significantly more often than the latter, in favor of the

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upper fusion model. As a secondary objective, we explore the relative salience of the different price terms. Ample prior research has demonstrated the adaptive priority of negative information over positive information (Rozin & Royzman, 2001). In line with this prediction, it has been shown that negative events and behaviors are remembered better (Skowronski & Carlston, 1989). Applied to generic price terms, this implies that consumers should show better recall for the terms referring to higher prices (expensive and not cheap) than for the terms referring to lower prices (cheap and not expensive). Of course, the ease with which alternative price terms are recalled is also interesting per se (apart from what it tells us about evaluative tone), as it provides an indication of the potential impact of customer reviews as a function of what price information they contain. Finally, we also assess the evaluative implications of the meaning of generic price terms for overall product ratings.

Method

We collected data from N = 740 Dutch-speaking respondents in the online panel of a global panel provider that charges a fixed fee per completed survey. In our sample, age ranged from 20 to 50 years (M = 36.6, SD = 8.8) and 50.0% were female. The questions used for this study were included in a survey containing measures related to diverse topics, including food and employment. Respondents read a mock consumer review of a hotel. In the review, the price term at the end of the description was manipulated: “Imagine you are planning a city trip. Read the following online review for a hotel in the city you plan to visit: Modest but pleasant room. Friendly and helpful staff. Quite a good location, not far away from the city center. [Cheap / Not

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cheap / Expensive / Not expensive].” To verify our assumption that consumers generally evaluate lower prices as more attractive, respondents then rated the attractiveness of the hotel on a seven-point scale ranging from 1 = very unattractive to 7 = very attractive. On the next page, respondents were asked (without being able to return to the previous page) to report what they remembered about the review.

Results and discussion

We first analyzed participants’ answers to the open-ended question in the recall task in order to gain more detailed insights into how people process generic price terms. Each response was coded into one of the following categories: verbatim recall of price terms, fusion or reverse fusion price recall (i.e., not cheap is remembered as expensive, not expensive is remembered as cheap, or vice versa), freely worded recall of price terms (e.g., not expensive is recalled as fair price), no price recall (e.g., only info unrelated to price is being mentioned), and incorrect price recall (e.g., a respondent reports recalling cheap while the review said expensive). Two judges independently coded the answers to the recall question without being aware of a respondent’s experimental condition. Given the unambiguous nature of the task (after checking for typos, the occurrence of the terms was checked by using a search function in MS Excel), no coding discrepancies occurred. Table 3 reports all the answer codes per condition. As expected, the incidence of fusion was highest in the not cheap condition (see Table 3). The hotel described as not cheap was recalled as expensive by about one in seven respondents (14.1%), and this percentage was significantly higher than the percentage of respondents who recalled not

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expensive as cheap (only 2.2%; see Table 3). Cheap or expensive were almost never recalled as their negated antonyms (i.e., as not expensive or not cheap, respectively). Table 3 also shows that some respondents did not report any price information in the recall task. This happened more frequently in the not expensive condition, least frequently in the expensive and not cheap conditions. This is in line with expectations (since negative information should be remembered better), although the differences with cheap are not statistically significant and the results are therefore somewhat inconclusive. In sum, we find that not cheap is relatively often remembered as expensive, which provides direct support for upper fusion, whereas fusion is less likely for not expensive, which provides indirect support for mitigation at the lower end of the price continuum. Finally, we tested whether lower prices are perceived as more attractive (when other specifics of the offer are kept constant) and, if so, whether attractiveness ratings show a pattern that reflects fusion for not cheap vs. expensive, but mitigation for not expensive vs. cheap. Figure 4 displays the result of this analysis. Consumers rated hotels that were described as having lower prices as more attractive than hotels described as having higher prices, but there was no evidence of mitigation for not expensive relative to cheap (i.e., hotels described as not expensive were not rated as significantly less attractive than hotels described as cheap).

Study 4 Although the results so far have consistently shown that cheap refers to lower prices than not expensive, we also found that options described using these terms were perceived as equally attractive in study 3. This may seem surprising as, based on the upper fusion pattern, one would expect higher attractiveness ratings for prices described as cheap vs. not expensive. The most

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likely reason for this apparent paradox is that lower prices have both positive and negative connotations. Specifically, we propose that, whereas not expensive refers to prices close to but lower than the reference price, cheap is often associated with both lower prices and lower quality (Lichtenstein et al., 1993). The total effect on the overall attractiveness of the offer therefore depends on the magnitude of the indirect effects via price and quality perceptions. To test this idea, we used a survey experiment focused on the labels cheap and not expensive only. Method We collected data among Dutch-speaking respondents via a global online panel provider who charges a fee per completed questionnaire. Only respondents who reported going to a pizzeria at least sometimes participated in this part of the survey (so we excluded respondents who picked ‘never’ in response to a screener question: ‘How often do you visit a pizza restaurant?’, with response options labeled never, seldom, sometimes, regularly, and often). In our sample (N = 663), 52% respondents were female and age ranged between 20 and 60 years (mean age = 39.5, SD = 11.5). First, respondents indicated their reference price for a standard pizza in a restaurant (using a dropdown box with prices ranging from €1 to €40 in one Euro increments). On the next page respondents were randomly assigned to one of two experimental conditions (not expensive versus cheap) and were asked to imagine themselves in the following situation: ‘You are planning to visit a pizza restaurant. Online you find the following review: Pizza Roma. Friendly service. Not expensive/Cheap.’ Next, respondents indicated their price expectation for a standard pizza at this restaurant (using a €1 to €40 dropdown box), the expected quality of the food (on a six-point scale ranging from ‘very low quality’ to ‘very high quality’), and the likelihood of visiting Pizza Roma (using a sliding scale from 0=’very unlikely’ to 100=’very likely’).

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Results To investigate the process underlying the effect of the two generic price terms on expected price, expected quality, and intention, we specified a path model in which the effect of the price terms (referred to as ‘cheap’ in the sequel) was specified as a dummy variable (0 = not expensive, 1 = cheap). Reference price was included as a control variable. To facilitate the comparison of estimated coefficients, all variables except for the dummy variable were standardized prior to the analysis. As shown in Figure 5, cheap was specified to influence intention via four different routes: directly, via expected price, via expected quality, and sequentially via both expected price and expected quality. Three effects were significant. First, cheap had a negative effect on expected price, in line with our previous results and the upper fusion model (i.e., cheap led to lower price expectations than not expensive, because not expensive has a more mitigated meaning than cheap). Second, expected price had a positive effect on expected quality, consistent with a positive price-quality schema (Lichtenstein et al., 1993). Third, expected quality had a positive effect on intention. Of the four routes via which cheap can influence intention only one is significant: cheap is associated with lower prices, lower prices lead to lower expected quality, and lower quality decreases intention. The total indirect effect via all three indirect routes is also significant, and so is the total effect of cheap on intention via all four routes. In sum, although cheap is associated with lower prices compared to not expensive (supporting the findings of previous studies), it is also associated with lower quality. Apparently then, prices associated with cheap may be perceived as too much of a good thing (i.e., the price may be too low to credibly imply good quality). The total effect of cheap vs. not expensive on the attractiveness of the offer depends on the balance of the various direct and indirect effects. In

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the present case, the total effect of cheap on intention was negative (i.e., relative to a pizza restaurant that was described as not expensive, a restaurant described as cheap led to lower visiting intentions). However, in other situations, the total effect may be nonsignificant (as in the previous study) or the total effect may be positive (if price has no quality associations).

Study 5

The results of the previous studies consistently provided support for upper fusion (or the linguistic positive bias and markedness models). In study 5, in an effort to test more explicitly whether it is indeed evaluative tone that is causing the asymmetry in mitigation, we will introduce a evaluative tone manipulation as a moderator. In particular, we aim to reverse the evaluative tone of low versus high prices by framing a product as a gift one purchases versus receives. Higher prices are often seen as a monetary sacrifice by consumers, but sometimes they are perceived as beneficial, for example because high prices may signal quality (Bornemann & Homburg, 2011). When receiving a gift, higher prices are assumed to be more desirable as people experience the benefits but not the costs of a higher price. If receiving a gift reverses the evaluative tone of cheap and expensive, this should also result in a shift in the meaning of their negations. When buying a gift, low prices are desirable and the meaning of (not) expensive and (not) cheap should be as before (i.e., the interpretational pattern should correspond to upper fusion). When receiving a gift, high prices are desirable, so we hypothesize that expensive refers to higher prices than not cheap, whereas not expensive is equivalent in meaning to cheap (i.e., the interpretational pattern should correspond to lower fusion).

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Method

As a pretest, US MTurk participants (N = 59, 64.4% female, mean age 35.12, SD = 11.8, with a range of 19 to 70 years) were asked “Please indicate to what extent you believe that the average consumer would prefer a low vs. a high price when they are buying vs. receiving a bottle of wine,” rated by two items (“When they receive a bottle of wine as a present for a friend” and “When they buy a bottle of wine as a present for a friend”) on a continuous slider scale anchored by “Prefer a low-priced bottle” (scored 1) to “Prefer a highly priced bottle” (scored 9). As intended, price preferences were significantly higher in the receive condition (M = 6.64, SD = 1.52) than the buy condition (M = 5.44, SD = 1.78; paired-sample t(58) = 3.662, p = .001). The main experiment was included in a survey among Dutch-speaking online panel members of a global panel provider who charges a fee per completed survey. In this sample (N = 493), 56.4% were women and age ranged from 19 to 66 years (M = 42.8, SD = 13.1). Before the actual experiment, respondents indicated their reference price for a bottle of wine (“Generally speaking, what do you consider a normal price for a bottle of wine?”, indicated in EURO from a drop-down list ranging from €0 to €50 in steps of €.50) and the extent to which they considered a bottle of wine as a suitable present (“Would you say that a bottle of wine can be something that is suitable as a present?”, with response options of No, never; Yes, sometimes; Yes, always). Only 1.6% of respondents indicated that wine was never appropriate as a present, whereas 81.5% said it could sometimes be appropriate and 16.8% said it was always appropriate as a present (excluding the eight respondents who deemed wine inappropriate led to the same substantive conclusions as the findings reported below).

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We used a 2 (buy versus receive) by 4 (cheap, not cheap, expensive, not expensive) between-participants experimental design. Respondents were asked to imagine themselves in a situation where they either purchased or received the product as a gift (‘Imagine that you want to buy a bottle of wine as a present for a friend’/‘Imagine that you receive a bottle of wine as a present from a friend’). They then answered the question ‘At what price would you consider this bottle of wine to be cheap / not cheap / expensive / not expensive?’ (using a scale from €0 to €50 in steps of €.50).

Results and discussion

Table 1 reports the chi-square and BIC values for the alternative models fitted to the data. Figure 6 displays the average price estimates per condition (controlling for mean-centered reference price). The results are consistent with our proposed extension of the linguistic positive bias model, where evaluative tone is contextually driven rather than a fixed property of a given adjective. When buying a gift, M cheap < M not expensive < M not cheap = M expensive (which is in line with the earlier results supporting upper fusion), whereas when receiving a gift, M cheap = M not expensive