We're more likely to listen to expensive advice
From the BPS Research Digest:
We're more likely to listen to expensive advice: "Whether its political spin doctors or orange-skinned health gurus, there seems no shortage of people seeking to charge others good money for the benefit of their wisdom.
Regardless of the quality of this advice, one thing is for sure: The fact that someone has paid for it, means it is more likely to be heeded.
That's according to Francesca Gino at Carnegie Mellon University, whose new study shows that we're more likely to use advice we've paid for than advice that's free, even if there's no difference in quality between the two sources.
Dozens of students were asked questions about American history and received small cash prizes for correct answers. The students were either given the option of receiving advice on the correct answers, or advice was imposed on them.
Sometimes this advice was free; other times it was paid for out of the students' winnings. Crucially, the advice always came from the same source - in the form of the answer that a student from a pilot session had given to the same question - so the quality of advice was held constant regardless of whether it was free or paid for.
Throughout the study, the participants took more account of advice they had paid for than advice they were given free, even though it was made clear to them that the advice was of the same quality.
A final study showed the students took even more account of advice if it was made more expensive.
(Via BPS Research Digest.)
This explains why few individuals purchase investigative services prior to purchasing a franchise: they know that they would accept the advice, which does not comport well with their American dreams.
Most sophisticated attorneys would recommend few franchise systems based on the fairness of the contract - but few want to know this.
