THE EFFECT OF OUTLIERS ON CONSUMER CHOICE.

Abstract

This research investigates the effects of an extreme value (outlier) on a consumer's choice. Two hundred Bryant University students were presented with a task to select a cell phone plan from a set of plans described by price and features. Choice sets contained either a moderate outlier, an extreme outlier, or both. Results of the study display two major useful outcomes. First, consumers will be willing to pay more for a product, if they see any type of outlier when making a choice. Second, irrelevant information is used in decision making even when consumers recognize that it should not be. [ABSTRACT FROM AUTHOR]