Restaurant Price Presentation Influences Check Averages, New Cornell Research Shows
Dollar Signs May Focus Patrons on the "Pain" of Spending, Restaurant Industry Research Suggests
"One theory to examine further is whether references to dollars, in words or symbol, reminds people of the 'pain of paying,'" said Kimes, who is Singapore Tourism Board Distinguished Professor of Asian Hospitality Management at the Cornell School of Hotel Administration. The study compared sales for menus with three price formats: a dollars and cents numerical format with a dollar sign ($00.00), a numerical format without a dollar sign (00.), and written-out prices (zero dollars). The researchers caution that their findings may apply only to lunch at this particular restaurant, but it seems clear that menu-price formats do influence customers' spending, both in terms of total check and average check.
The restaurant industry research report concludes: "As much as we might like to believe that we can earn a quick buck by changing the type and presentation of our menus, it is clear that operational factors have a much larger impact on purchase behavior than price typography does. Controlling for other factors, however, we saw a significant spending difference for menus that presented prices as numerals only."
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About the Center for Hospitality Research
The purpose of the Center for Hospitality Research is to enable and conduct research of significance to the global hospitality and related service industries. CHR also works to improve the connections between academe and industry, continuing the School of Hotel Administration's long-standing tradition of service to the hospitality industry. Founded in 1992, CHR remains the industry's foremost creator and distributor of timely research, all of which is posted at no charge for all to use. In addition to its industry advisory board, CHR convenes several industry roundtables each year for the purpose of identifying new issues affecting the hospitality industry.
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