Take that! Brand Torture=Low, Low, Prices

New research out of MIT’s Sloan School looks at ways consumers can punish brands. Turns out that savvy consumers understand that deeply discounted prices hurt brands by shaving down profit margins. Converesly, people are willing to pay a premium for socially responsible brands. For example, consumers were willing to pay more than $4.00 more for “ethically grown” coffee. On the flip side, consumers “punished” unethical coffee brands for their bad behavior with a mean price that was $2.42 below the control group’s. So, negative information had almost twice the impact of positive information on the participants’ willingness to pay. “

thanks to photographer Wendy Adams for making shopping look so cool on Flickr