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The effects of anchoring on backers' pledge in reward-based crowdfunding: evidence from Taiwanese market

The effects of anchoring on backers' pledge in reward-based crowdfunding: evidence from Taiwanese... Crowdfunding allows enterprises or individuals to collect funds from numerous other individuals. This study applies the anchoring effect and range theory in reward-based crowdfunding to explore how different pledge option designs affect the backers' final pledge amount. Moreover, this study examines whether showing the current average amount pledged in the fundraising process has an anchoring effect on the subsequent backers' pledge amount.Design/methodology/approachOnline experiments were conducted, and data were analyzed using the Kruskal–Wallis test and Spearman rank correlation analysis.FindingsResults show that among the three pledge option designs, employing the “bolstering range offer” has the highest backing amount. However, presenting the current average amount pledged in the fundraising process has a reversed anchoring effect on subsequent backers' pledge amount only in the case of a crowdfunding project in the physical goods category with a “point offer.”Originality/valueTo the best of authors’ knowledge, no reward-based crowdfunding platform has yet provided the pledge option design of a “bolstering range offer.” This study reveals that the “bolstering range offer” can significantly increase the amount pledged. This study extends the crowdfunding research area to crowdfunding success and suggests a novel way to set up pledges. http://www.deepdyve.com/assets/images/DeepDyve-Logo-lg.png Internet Research Emerald Publishing

The effects of anchoring on backers' pledge in reward-based crowdfunding: evidence from Taiwanese market

Kuo, Ying-Feng; Lin, Cheng-Han; Hou, Jian-Ren
Internet Research , Volume 31 (2): 19 – Mar 10, 2021
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References (67)

Publisher
Emerald Publishing
Copyright
© Emerald Publishing Limited
ISSN
1066-2243
DOI
10.1108/intr-05-2020-0260
Publisher site
See Article on Publisher Site

Abstract

Crowdfunding allows enterprises or individuals to collect funds from numerous other individuals. This study applies the anchoring effect and range theory in reward-based crowdfunding to explore how different pledge option designs affect the backers' final pledge amount. Moreover, this study examines whether showing the current average amount pledged in the fundraising process has an anchoring effect on the subsequent backers' pledge amount.Design/methodology/approachOnline experiments were conducted, and data were analyzed using the Kruskal–Wallis test and Spearman rank correlation analysis.FindingsResults show that among the three pledge option designs, employing the “bolstering range offer” has the highest backing amount. However, presenting the current average amount pledged in the fundraising process has a reversed anchoring effect on subsequent backers' pledge amount only in the case of a crowdfunding project in the physical goods category with a “point offer.”Originality/valueTo the best of authors’ knowledge, no reward-based crowdfunding platform has yet provided the pledge option design of a “bolstering range offer.” This study reveals that the “bolstering range offer” can significantly increase the amount pledged. This study extends the crowdfunding research area to crowdfunding success and suggests a novel way to set up pledges.

Journal

Internet Research – Emerald Publishing

Published: Mar 10, 2021

Keywords: Crowdfunding success; Pledge option design; Anchoring effect; Range theory

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