Experiment 1: Reference Pricing

a. Place the two products together. Place a sign on one with a low price. Place a sign on the other with a high price (about 50 percent higher will do). Ask your research participants to evaluate the quality of each of the items and to tell which one they would probably purchase.

b. Reverse the signs and ask other research participants to evaluate the quality of each of the items and to tell which one they would probably purchase.

c. Place the two products together again. This time place a sign on one with a moderate price. Place a sign on the other that is only a little higher (less than 10 percent higher). Again, ask research participants to evaluate the quality of each of the items and to tell which one they would probably purchase.

d. Reverse the signs and ask other research participants to evaluate the quality of each of the items and to tell which one they would probably purchase.