Mind the App: Information Design and Consumer Behavior
80 Pages Posted: 15 Jul 2021
Date Written: July 14, 2021
In a randomized field experiment, I test if the way in which information is presented influences consumer behavior. Users of an online account aggregation app received a personalized index representing their net worth as a lifetime monthly cash flow. The presentation of the index varied in the framing used to describe the index and in the salience of the comparison between the index and the user's historical spending. Consumers that received a consumption frame (promoting a mental reflection about the affordability of future consumption) and a salient comparison with historical spending decreased their discretionary spending by 15% relative to other treatments throughout the eight months of the experiment. The effect persisted for an additional eight months after the removal of the experiment content from the app. The sensitivity of consumers' spending to information design presents opportunities for policies aimed at influencing saving rates.
Keywords: framing, salience, field experiment, household finance, spending, savings, fintech, annuities
JEL Classification: D12, D14, D15, D91, G41, G51
Suggested Citation: Suggested Citation