On the Mental Accounting of Restricted-Use Funds: How Gift Cards Change What People Purchase

Journal of Consumer Research (2015) 42 (4): 596-614

19 Pages Posted: 2 May 2016 Last revised: 3 May 2016

See all articles by Daniel M. Bartels

Daniel M. Bartels

University of Chicago - Booth School of Business

Nicholas Reinholtz

University of Colorado at Boulder - Leeds School of Business

Jeffrey Parker

University of Illinois at Chicago - College of Business Administration

Date Written: September 10, 2015

Abstract

This article emphasizes the role of categorization in mental accounting and proposes that once a mental account is established, purchases that are highly congruent with the purpose of the mental account (i.e., typical category members) will be more preferred in selection decisions compared to purchases that are less congruent (i.e., atypical category members). This hypothesis is tested in the context of gift cards. Six studies find that people shopping with a retailer-specific gift card — and so, the authors argue, possessing a retailer-specific mental account — express an increased preference for products more typical of the retailer compared to those shopping with more fungible currency. This pattern is found to occur for both well-known retailers, where people already possess product-typicality knowledge, and fictional retailers, where product-typicality cues are provided. An alternative account based on semantic priming is not supported by these data. These results both broaden the contemporary understanding of how mental accounting influences preferences and provide retailers deeper insight into their customers’ decision processes.

Keywords: mental accounting, categorization, gift cards, mental representation

Suggested Citation

Bartels, Daniel M. and Reinholtz, Nicholas and Parker, Jeffrey, On the Mental Accounting of Restricted-Use Funds: How Gift Cards Change What People Purchase (September 10, 2015). Journal of Consumer Research (2015) 42 (4): 596-614, Available at SSRN: https://ssrn.com/abstract=2772664

Daniel M. Bartels (Contact Author)

University of Chicago - Booth School of Business ( email )

5807 S. Woodlawn Avenue
Chicago, IL 60637
United States

Nicholas Reinholtz

University of Colorado at Boulder - Leeds School of Business ( email )

Boulder, CO 80309-0419
United States

Jeffrey Parker

University of Illinois at Chicago - College of Business Administration ( email )

601 South Morgan Street
11th Floor
Chicago, IL 60607
United States

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