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The effects of anchoring on backers' pledge in reward-based crowdfunding: evidence from Taiwanese market

Ying-Feng Kuo (Information Management, National University of Kaohsiung, Kaohsiung City, Taiwan)
Cheng-Han Lin (Information Management, National University of Kaohsiung, Kaohsiung City, Taiwan)
Jian-Ren Hou (Industrial and Information Management, National Cheng Kung University, Tainan City, Taiwan)

Internet Research

ISSN: 1066-2243

Article publication date: 23 October 2020

Issue publication date: 10 March 2021

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Abstract

Purpose

Crowdfunding allows enterprises or individuals to collect funds from numerous other individuals. This study applies the anchoring effect and range theory in reward-based crowdfunding to explore how different pledge option designs affect the backers' final pledge amount. Moreover, this study examines whether showing the current average amount pledged in the fundraising process has an anchoring effect on the subsequent backers' pledge amount.

Design/methodology/approach

Online experiments were conducted, and data were analyzed using the Kruskal–Wallis test and Spearman rank correlation analysis.

Findings

Results show that among the three pledge option designs, employing the “bolstering range offer” has the highest backing amount. However, presenting the current average amount pledged in the fundraising process has a reversed anchoring effect on subsequent backers' pledge amount only in the case of a crowdfunding project in the physical goods category with a “point offer.”

Originality/value

To the best of authors’ knowledge, no reward-based crowdfunding platform has yet provided the pledge option design of a “bolstering range offer.” This study reveals that the “bolstering range offer” can significantly increase the amount pledged. This study extends the crowdfunding research area to crowdfunding success and suggests a novel way to set up pledges.

Keywords

Acknowledgements

This research is supported by the Ministry of Science and Technology (MOST 106-2410-H-390-012), Taiwan. The authors thank STIMLIG™ and KIGE Studio for the permission to use the content of their crowdfunding projects in our experiments. Earlier versions of this paper were presented at the 5th Multidisciplinary International Social Networks Conference, Saint-Etienne, France, 2018 and at the 2018 International Symposium on Business and Management, Osaka, Japan, 2018.

Citation

Kuo, Y.-F., Lin, C.-H. and Hou, J.-R. (2021), "The effects of anchoring on backers' pledge in reward-based crowdfunding: evidence from Taiwanese market", Internet Research, Vol. 31 No. 2, pp. 635-653. https://doi.org/10.1108/INTR-05-2020-0260

Publisher

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Emerald Publishing Limited

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