Marketers of beauty products capitalize on consumers’ perception of beauty to enact a price placebo effect through setting high prices to insinuate a superior performing product. Yet, in the context of growing alternative beauty movements emphasizing inner beauty and self-acceptance, little is known on how the effect of price on a product’s perceived effectiveness and satisfaction is bounded by different modes of beauty conceptualization (BC). Hence, this study aims to investigate how distinct perceptions of beauty impact the effectiveness-based and satisfaction-based price placebo effects in Muslim-majority markets such as Turkey compared to markets largely driven by Western values such as New Zealand.
This research is based on a quasi-experimental factorial design based on the manipulation of the level of price for a beauty product and the observation of the extent of BC. The sample included 144 participants from Turkey and 147 participants from New Zealand.
This research finds that the manipulation of the price (low vs high) equally activates the effectiveness-centered price placebo effect in both countries. When expectations are taken into account, the (satisfaction-based) price placebo effect is non-existent in New Zealand, while in Turkey the higher price leads to an opposite effect: a significant decrease in satisfaction. It is also found that the effect of price on effectiveness is moderated by BC. In both countries, the price placebo effect is activated only when consumers narrowly conceptualize beauty, while this effect does not hold for broad conceptualizers. The effect of BC on the price placebo appears to be stronger in New Zealand in comparison to Turkey.
Marketing managers’ awareness of different perceptions of beauty and how these may influence the price placebo effect in different cultures would allow them to decide what strategies are most appropriate for different groups of customers. For example, by pursuing the movement toward inner beauty and its broad conceptualization, high-end brands are likely to compromise opportunities to capitalize on the price placebo effect. On the other hand, this alternative perspective may cultivate profound satisfaction in the long-term.
The price placebo effect disappears when people conceptualize beauty from a broad (inner) perspective. This suggests that public policymakers, to counteract the negative effects of misleading marketing and to create fair exchanges, must promote broad BC in society.
This study contributes to the body of the existing research on price placebo by offering unique insights into the boundary conditions of the price placebo effect underscored by BC in two distinct cultural-religious settings. Also, it proposes two different variations of price placebo, namely, effectiveness-centered vs satisfaction-centered. From a methodological point of view, it is the first project in the Islamic marketing discipline that applies the Islamic perspective on causality.
Kadirov, D., Raju, C., Bardakcı, A., Madak, N. and Saud Khan, M. (2020), "Does beauty have a price? The impact of a conceptualization of beauty on the price placebo effect in Turkey compared to New Zealand", Journal of Islamic Marketing, Vol. ahead-of-print No. ahead-of-print. https://doi.org/10.1108/JIMA-06-2019-0121Download as .RIS
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