Power of Advertising Claims for Credence Goods: Can It shape the Placebo Effect and Repurchase Decisions?

Anjan Bharali and Chimun Kr. Nath
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Anjan Bharali: Dibrugarh University, India
Chimun Kr. Nath: Dibrugarh University, India

Review of Applied Socio-Economic Research, 2021, vol. 22, issue 2, 49-67

Abstract: This study aims to find out if Advertising claims of credence goods can shape Placebo effect and lead to repurchase decisions or not. The concept of extrinsic factors of a brand being an important ingredient in consumer satisfaction is the antecedent for the study. Studies have been made to show how Advertisement helps products and services to sell more. But very few have tried to connect it with credence goods and know how consumers perceive satisfaction for those products. Further the phenomenonof repurchase decisions of credence goods is still unrevealed. On the basis of focus group technique,data has been collected for five brands which are considered as credence goods and an analysis has been provided to seewhether advertising claims can create Placebo effect or not. The analysis of the factors involved in taking repurchase decision of credence goods has also been studied by selecting variables taken as basis. The results indicate that Advertising claims of credence goods can lead to Placebo effect for those where consumers have strong urge for a positive result after using the brand. The rationality of a consumer influences the repurchase decision inversely. There is a strong connection between Placebo effect, Rationality and Repurchase decision of credence goods. Marketers thus have to be cautious while publishing claims of such goods.

Keywords: advertising claims; credence goods; placebo effect; repurchase (search for similar items in EconPapers)
JEL-codes: M3 M31 M37 (search for similar items in EconPapers)
Date: 2021
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