Pay Before Play
Identification
Everything is about time, isn’t it? Prelec and Loewenstein posit in their 1998 study that separating the time of payment and the time of reception of the product—in particular, allowing consumer to purchase before enjoying their subscription—allows those consumers to experience more pleasure from said product, free of the burden or close association of parting with money.
Example
Looking forward to his cable TV subscription, John Smith happily shells out $100 a month preoccupied with thoughts of all the shows he can’t wait to watch. John Smith has selected this cable service, with a monthly subscription, rather than the service that charges him per hour of show. Not only is it a hassle, but he feels a pang of loss each time he pulls out his credit card.
Solution
Mitigate risk—ensure that the company you are buying from has a good reputation for delivering on their promises so that you can evaluate if a pre-paying for this service is worth it to you.