Request Payments From Painless Methods

Spending cash feels most painful.

Followed by:

• Bank Accounts
• Payment Apps
• Credit Cards
• Gift Cards

But it varies. Even within mediums.

For example, which app feels more painful: Venmo or Zelle?

Each differs in one aspect:

• Venmo has a balance within the app
• Zelle pulls directly from bank accounts

Venmo feels less painful because it's further removed from cash: It's app money, not real money (Pomerance & Reinholtz, 2024).

In fact, more products are sold in Facebook Marketplace when the poster requests Venmo (vs. Zelle; Pomerance & Reinholtz, 2024).

Why It Works

• Utility of Funds. Cash can buy anything, while apps are limited to peer-to-peer transactions. Less utility? Less pain spending these funds. An $80 textbook on Amazon felt less painful to buy with a book-only gift card (vs. anything card; Pomerance & Reinholtz, 2024).

How to Apply

• Request Payments From Apps. Peer-to-peer transactions result in fairer outcomes for buyers and sellers because the social context encourages more cooperation (Huang & Savary, 2023).
• Convert Cash to a Different Medium. Credits feel less painful to spend because of the limited utility of these funds.

• Request Payments of Time. Time strengthens the bond between a customer and product — e.g., you feel closer to your phone after reflecting on how much time (vs. money) you've spent (Mogilner & Aaker, 2009). And it's easier to spend: People were twice as likely to stop by a lemonade stand (and pay twice as much) when they noticed a sign asking them to spend a little time (vs. money; Mogilner & Aaker, 2009). In ridesharing apps, users prefer a feature to Wait & Save over Priority Pickup in which they pay more for a quicker ride (Trupia, & Shaddy, 2024).

Caveats

• Offer Painful Methods to Captive Customers. Customers feel more attached to items when they pay in painful methods because of cognitive dissonance. For example, donors who pay by check become 10% more likely to donate in the future (Shah et al., 2016).

• Huang, L., & Savary, J. (2023). When Payments Go Social: The use of Person-to-Person payment methods attenuates the endowment effect. Journal of Marketing Research, 60(3), 585-601.
• Mogilner, C., & Aaker, J. (2009). “The time vs. money effect”: Shifting product attitudes and decisions through personal connection. Journal of Consumer Research, 36(2), 277-291.
• Park, J., Lee, C., & Thomas, M. (2021). Why do cashless payments increase unhealthy consumption? The decision-risk inattention hypothesis. Journal of the Association for Consumer Research, 6(1), 21-32.
• Pomerance, J., & Reinholtz, N. (2024). Cut me some slack! How perceptions of financial slack influence pain of payment. Psychology & Marketing.
• Shah, A. M., Eisenkraft, N., Bettman, J. R., & Chartrand, T. L. (2016). “Paper or plastic?”: How we pay influences post-transaction connection. Journal of Consumer Research, 42(5), 688-708.\
• Thomas, M., Desai, K. K., & Seenivasan, S. (2011). How credit card payments increase unhealthy food purchases: Visceral regulation of vices. Journal of consumer research, 38(1), 126-139.
• Trupia, M. G., & Shaddy, F. (2024). “No time to buy”: Asking consumers to spend time to save money is perceived as fairer than asking them to spend money to save time. Journal of Consumer Psychology, 00, 1–13.