The Effect of Category Informativeness on Risk Perception

Rizwan, Taimoor
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University of Guelph

Prior literature has looked at product categories and how their presentation can effect the preference for products by consumers. We are extending the research by proposing how the informativeness of categories can influence risk perception in a different unrelated scenario. We use category labels for the manipulation and measurement of category informativeness. By unrelated scenario, we mean an activity that has no connection to the categories of product presented to the consumer. For example, assessing risk and betting in a game of chance after processing different coffee category labels. The case we are making is for a generalized effect in which feelings of control initiated through processing of categories are transferred from one decision making scenario to another. We will be looking at informative and less-informative category labels, with the number of products or options staying the same. Informative category labels for this research will be denoted by verbal labels. For example, dishes of food being placed under either ‘Spicy’ or ‘Tangy’ categories. In contrast, less-informative category labels will be those using visuals to describe category membership. The reason we consider verbal labels as more informative is because consumers process verbal information in a piecemeal way, which research has shown, is a more systematic way of processing information. Specifically, our hypothesis is contingent on two broad propositions. Firstly, if options are placed under informative category labels (as opposed less-informative category labels), it will make it easier to identify preferences and make a choice which either increases the consumer`s perceived control in making a choice or depletes cognitive resources. Secondly, this perceived control or C.R will lead to lower risk perception in different activities as past literature has shown the inverse relationship between perceived control and risk perception.

Categories, Risk Perception, Informative categories, Perceived control