Spending money on hedonic luxuries often seems wasteful, irrational, and even immoral. We propose that adding a small utilitarian feature to a luxury product can serve as a functional alibi, justifying the indulgent purchase and reducing indulgence guilt. We demonstrate that consumers tend to inflate the value, and usage frequency, of utilitarian features when they are attached to hedonic luxuries. Using a mixed-method approach, combining archival data (an analysis of over 1,000 online reviews of handbags) with studies conducted in the field and laboratory, we establish the functional alibi effect and show that it is mediated by guilt and more likely to occur when the luxury purchase is perceived as frivolous and expensive, and when the purchase is for oneself rather than a gift. We explore the effect of adding a functional alibi in a variety of marketing contexts, and we examine various consumer populations representing diverse demographics.
Keinan, Anat, Ran Kivetz, and Oded Netzer. "Functional Alibi." Journal of Academy of Consumer Research 1, no. 4 (October 2016): 479-496.
Each author name for a Columbia Business School faculty member is linked to a faculty research page, which lists additional publications by that faculty member.
Each topic is linked to an index of publications on that topic.