TO BE EXTRAVAGANT OR ETHICAL? INTERACTIVE EFFECTS OF CREDIT CARD TYPES AND INDIVIDUAL CHARACTERISTICS ON LUXURY CONSUMPTIONS

다국어 초록 (Multilingual Abstract)

This research was conducted in order to examine whether the type of credit card (premier vs. standard card) influences consumer purchase decisions regarding luxury consumption. The present research reports three experiments with online panels of non-student adults, which find that (1) the use of a premier card (vs. a standard card) leads to a more goal-congruent choices, (2) the effect is mediated by a temporary increase in the perception of pride, and (3) the effect is pronounced for people with a low level of chronic pride.
The effect of payment methods on consumer spending has been a concern of theory and research in consumer behavior (Bernthal, Crockett, & Rose, 2005; Feinberg, 1986; Prelec & Lowenstein, 1998; Soman, 2001). This research stream has shown that consumers tend to spend more when they use a credit card than when they pay cash and has proposed various theoretical mechanisms to account for the phenomenon (Chatterjee & Rose, 2012; Prelec & Simester, 2001; Soman, 2001; Thomas, et al., 2011). However, researchers have paid little attention to the effect of different types of credit cards (i.e., premier vs. standard card) on consumer decisions.
We contend that the use of a premier card (vs. a standard card) can increase the feeling of pride momentarily and in turn increase consumers’ motivation to pursue a long-term goal that they value. As a result, they prefer a choice alternative that is more congruent with the goal. To be specific, the use of a premier card would increase the choice of luxury alternative, and that this effect would be pronounced for those who value material possessions (i.e., high materialism). This expectation was confirmed in the studies that we have performed.
In three experiments, participants were shown a credit card(either premier or standard) and were asked to assume that they were going to use it for their purchase. Then, they were asked to make choices in shopping contexts. Participants with premier credit card, compared to those with standard card, showed more goal-consistent choices. They were more likely to choose luxury alternatives, and this effect was apparent only for those who have a high materialistic value. When the choice set includes both a low-calorie food and a high-calorie food, the use of a premier card increased the choice of low-calorie food, and this effect was apparent only for those with diet goal. These effects were mediated by the feeling of pride.
Three studies in combination provide insights into the effect of types of credit cards on consumer spending regarding luxury consumption and the processes underlying the effect, which have not been reported elsewhere. The use of a premier credit card (vs. a standard credit card) led to a greater choice of luxury alternatives over standard alternatives and a greater choice of low-calorie foods over high-calorie foods. However, these effects were apparent only when people highly valued the goal under consideration (i.e., high materialism or strong diet goal). Finally, these effects were attributable to a momentary increase in the perception of pride by virtue of the use of a premier card, and consequently, the effects were observable only for people who have a relatively low chronic pride.
The effects we observed in this research generalized over different product categories and different long-term goals. Nevertheless, it is desirable to extend findings in more diverse consumption categories (e.g., services) as well as to identify additional variables that moderate the magnitude of the effect. In addition, it is worth considering alternative underlying mechanisms than the one we considered (i.e., the feeling of pride) in future research. For example, a premier card may increase individuals’ construal level, thereby affecting consumer purchase decisions.