How Video Games Trick You Into Spending Money

If you’re not so good with money, you should
try holding on to your cash. Hello Scrooges, Julian here for DNews. If you’re like me, you’re bad with money. Nerdy T-shirt? I need it. Steam Summer sale? Wallet armageddon. Something that even vaguely references Futurama? “Shut up and take my money!” If I could just stop burning through all the
sweet sweet internet cash I’m making, I’d be a hundredaire by now. Luckily for me there might be a way to curb
my spending sprees, and it’s as simple as switching from credit cards to cash. Not because you can’t pay with cash online
or because cash purchases don’t charge an interest rate, though I’m sure those both
help. At an even more fundamental level, it’s
just harder to part with money that you are physically holding in your hand than it is
to swipe a card and sign the receipt. This idea that we spend more based on the
form of payment has a few studies to back it up. One from MIT in 2001 auctioned off tickets
to a sold out basketball game. Students who showed interest in the tickets
were given a worksheet that asked how much they were willing to pay. Unbeknownst to the participants, the researchers
handed out two different worksheets at random. One stipulated that the payment had to be
in cash, the other required the student to pay with a credit card. The result was the average credit card bid
was over twice as high as the average cash bid. Another series of studies published in the
Journal of Consumer Research in 2015 examined how attached we are to our purchases based
on how we payed.,6 In one of the studies, participants had to buy a $2 mug, half had
to pay in cash and the other half had to buy it with plastic. Later when they were asked to sell the mug
back, the people who paid in cash wanted $3 more on average for a mug that didn’t even
cost that. Another study didn’t even have the participants
use their own money; they were either given a $5 bill or a $5 voucher and had to donate
it to one of three charities they had never heard of. Even though it wasn’t their own money, cash
donors reported a stronger connection to their chosen charity. So we’re less invested in our purchases
when we pay with a credit card, and we’re even more laissez faire when we don’t think
of our money as money. Some industries are aware of this, and have
explicitly designed ways to put more mental distance between you and your money. If you’re a gamer, you know what I’m talking
about. Many games, particularly the “free to play”
mobile games, have a premium currency system in place where you pay real money to buy fake
money to buy fake things. Of course you probably think that you’d
never stoop to paying for this free game; you’re going to play for free forever! That’s why the game makers design a point
where the game gets much harder to play unless you pay up. It’s called “the pinch,” and 1.9% of
the time it works every time. That’s the percentage of players of “free”
games who decide to make in-app purchase in a month. It’s not just free games though, as now
some Triple A titles also have in-game currency for purchase that takes the effort out of
unlocking rewards *cough* Helix Credits *cough*. So you can spend $60 on a game, and then another
$100 so you don’t have to play the game. A lot of gamers bemoan in-game purchases as
the latest plague of gaming, but as development costs rise, it’s a viable strategy for developers
to recoup their investments. And it works because the foggier the connection
is between what we’re buying and it’s real cost, the more likely we are to be OK
with spending our money. Apparently a good way to save your cash is
to literally hold on to it. But is your money icky? Anthony tries to figure out just where your
money’s been here. Do you notice you spend more freely when you
use a credit card, or are you frugal either way? Let us know in the comments, subscribe for
more and I’ll see you all next time on DNews.

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