Does Priming Reference Points Alter Attribute-Value Functions, and As a Result Attribute Importance and Choice?

Can marketers influence attribute-value functions and as a result alter the importance of attributes in judgment, and choice? While economic theory argues that value functions are stable and have a consistent impact in judgment and choice, behavioural decision theory suggests otherwise. This research addresses this question by examining the effect of primed reference points, internal and external, on the shape of decision makers’ attribute-value functions, attribute importance, and choice. The authors show that priming (internal and external) reference points influences the shape of attribute-value functions and consequently the importance of attributes in judgment, and choice for decision makers with undefined value functions. These effects are attributed to the decision makers’ reference dependence and loss aversion in attribute-value function construction. Decision makers with well-defined value functions are not prone to the effects of priming – their attribute-value functions are stable and have a consistent impact on judgment and choice. The results help bridge economic and behavioural decision theories and provide policy makers and marketers with tools that enable them to more effectively position their services and products in the market place.