Spending Money Makes Us Feel Actual Pain
The knowledge that we are spending our hard earned money lights up the same parts of our brain as when we feel actual physical pain. It hurts us to spend money, often more than the joy we imagine feeling from the product or service we're thinking of buying.
This is why the most abandoned part of every website is the payment screen.
Researchers hooked their subjects up to an fMRI machine, and gave them $20 to spend on a series of products. They would go through the process of choosing a product and paying for it with cash, while the fMRI machine scanned their brain activity.
Every time an expensive product was shown to the participants, the 'insula' part of their brain would light up. This is the pain center of the brain, which naturally becomes active when we experience physical pain.
Rather than focusing on the pleasure it might get from the product, our brain focuses on the pain of payment. Making the process of convincing someone to buy a product that much harder.
Our brain tends to focus on the pain of payment mostly when payments are direct and in cash. The pain decreases as we move away from direct payments that feel so much like spending money. Our mental pain decreases once we move from cash to credit, for example. Since the process of swiping a card feels less like spending money than counting out and giving away cash. The pain decreases even more if we spend an alternate currency, like poker chips or online premium currencies. It works even if those currencies are directly exchanged later for cash. The brain, it seems, doesn't notice the difference.
This is why so many freemium products replace dollars with their own, once removed, premium currency, like diamonds, candy bars, or doughnuts. Though paying with a credit card hurts less than with cash, online payment forms seem to be doing their best to remind shoppers of the pain. The process of choosing a credit card and manually typing in its infinite details, might as well revert us to paying in cash. It's drilled into our mind. It's important to make sure the purchaser knows exactly what they are paying for and how much it will cost. We are not in the business of tricking people into a purchase. ?There is a difference, however, between fully understanding the cost of a product, and irrationally feeling pain when doing so. As behavioral designers, we aim do decrease pain wherever we can.