Neuroscience Marketing covers how psychology and brain research explain consumer behavior, pricing, and branding.
HN commenters cite its articles on the scarcity effect, free pricing, and Apple fanboys as research-backed explanations of persuasion.
Behavior economics suggests that you're wrong[1]. Users do not like metered useage even when it benefits them. An anecdotal illustration of this at work:
> What was the biggest complaint of AOL users? Not the widely mocked and irritating blue bar that appeared when members downloaded information. Not the frequent unsolicited junk e-mail. Not dropped connections. Their overwhelming gripe: the ticking clock. Users didn’t want to pay by the hour anymore. ... Case had heard from one AOL member who insisted that she was being cheated by AOL’s hourly rate pricing. When he checked her average monthly usage, he found that she would be paying AOL more under the flat-rate price of $19.95. When Case informed the user of that fact, her reaction was immediate. ‘I don’t care,’ she told an incredulous Case. ’I am being cheated by you.’
The transactional friction between "free" and "not free" is high, even for very small values of "not free." This has been backed up by experiments[2]:
> In his book Predictably Irrational, Ariely describes a series of simple experiments that offered subjects something desirable – chocolate – at a variety of prices. Two types of chocolate were used – a Hershey’s kiss and a Lindt chocolate truffle. While the kiss is an inexpensive and common treat, a Lindt truffle is a far more tasty confection that costs an order of magnitude more than the kiss.
> The first experiment offered subjects a truffle for 15 cents (about half its actual cost) or a kiss for 1…
I'd actually say this is an example of the "scarcity effect."
http://www.neurosciencemarketing.com/blog/articles/scarcity-effect.htm
WORCHEL, LEE, AND ADEWOLE (1975) asked people to rate chocolate chip cookies. They put 10 cookies in one jar and two of the same cookies in another jar. The cookies from the two-cookie jar received higher ratings—even though the cookies were exactly the same! Not only that, but if there were a lot of cookies in the jar, and then a short time later most of the cookies were gone, the cookies that were left received an even higher rating than cookies that were in a jar where the number of cookies didn’t change. [From Neuro Web Design by Susan Weinschenck.]
Because having something priced as "free" is distorts the market. Consumers don't see immediately the price they pay for the product. There's plenty of experiments with people having to choose between something that is $1 in price difference and when both options are paid, people make a rational choice. However, when one of the options is free and the other cost 1$, a disproportionate amount of people choose the free option. [0]
So yeah, I think legislation should strongly push things away from free - because everything has a cost and it should be visible to end users.
[0] - https://www.neurosciencemarketing.com/blog/articles/the-power-of-free.htm
" The ad on this site was an Amazon ad for a pool filter I bought on Amazon about a week ago. It should know that I don't need these for like another year now. The other was for a cruise which I just got back from last week. "
Advertising isn't just about what you really need, but also about what you will need more, or again, or earlier, because the commercial impressed the product need in your head. Neuromarketing is a science nowadays, and is pretty scary to me.
Some interesting content on the topic here.
http://www.neurosciencemarketing.com/blog/home
I designed supraliminal posters[1] to counter the covert forms of persuasion like Low Attention Processing marketing[2]. I definitely find them helpful, especially for meditation.
[1] http://zenpusher.com
[2] http://www.neurosciencemarketing.com/blog/articles/low-attention-branding.htm
http://www.neurosciencemarketing.com/blog/articles/apple-fanboy-religious-fanatic.htm is quite interesting in this regard. I know its focused on Apple users, but I wouldn't be surprised if you get similar results by putting evangelists for different platforms through the experiment.