The effects of physical distance between regular and sale prices on numerical difference perceptions

Abstract

This paper draws upon the psychological, psycho-physiological, and numerical cognition literature(s) to suggest that numerical difference perceptions may be influenced by the physical distance between two prices. In the context of four experiments, we find that a greater horizontal separation of prices leads to greater difference (and hence price-discount) perceptions. The greater price-discount perceptions are linked to a higher perceived value and increased purchase likelihood. The effect is not observed for prices separated by large versus small vertical distances. The processing mechanisms driving our results involve the automatic and non-conscious encoding of “magnitude representations” (i.e., judgments of relative size) related to both relevant (numerical difference) and non-relevant (physical distance) dimensions.