[Pricing Nugget #038] How Happy Do Smileys Make Your Customers About Your Prices?

Imagine you are about to open a new restaurant and you're currently designing the new logo. You might think it is a good idea to put a smiley into this logo, a happily smiling face.

Is this really a good idea? Let us find out today.

Researchers ran a study...

...to investigate the following question: "Although smiley faces are popular logo design elements, their influence on product brand perceptions has yet to be studied." (p. 2)

The researchers created a logo for an artificial restaurant and added a smiley to it.

The researchers argued that customers might draw on past experience with logos that include a smiley.

For example, the Happy Meal offered by McDonald's customers. Particularly in the US, people are familiarized with the Happy Meal and its logo.

Hence, whenever a consumer sees a smiley in a restaurant's logo, and the restaurant is unknown to them, they might draw on past experience – for example, their experience with McDonald's.

Research shows that customers associate McDonald's with fast food, and they associate fast food with unhealthiness and inexpensiveness.

Therefore, customers might take these perceptions and transfer them to the logo they see of an unknown brand.

The researchers conclude that a preexisting association and categorization with the fast food restaurant category, in this case, McDonald's, would negatively influence price and healthfulness perceptions without other information about the restaurant brand.

So customers take this smiley as a cue to evaluate this unknown restaurant and logo. In particular, the researchers checked two sets of questions.

When it comes to price expectations: How inexpensive or expensive does this restaurant seem?

Asking about the consumers' willingness-to-pay: If you were to eat lunch at this restaurant, how much would you be willing to pay for a meal for one person?

Price expectations? Low.

Across all studies, consumers expect that the restaurant would be cheaper if a smiley was put into a logo.

Willingness to pay? Low.

Asking for customer's willingness to pay, the researchers found that customers are willing to pay 14% less if they recognize the smiley in a logo.

What did we learn today?

We learned we should not put a smiley into the logo if we do not want to position our new restaurant next to McDonald's.

That seems a bit too concrete.

But from a more abstract point of view, you should be conscious about the signals and cues you leave to customers when creating a new brand or product experience for customers they do not know yet.

People look around for different pieces of information to make assumptions and conclusions about your price and quality levels.

That is important because, based on customers' expectations about your brand and product, they develop a willingness to pay and satisfaction.

You might remember: satisfaction is the perceived difference between expectation and actual experience. And if consumers expect lower prices and see your higher prices, they might become very disappointed.

Look for cues you unconsciously set for your customers, and when in doubt, err on the side of cues that might raise your customer's price expectations.


Abell, A., Smith, L., & Biswas, D. (2022). What’s in a “Happy” Meal? The Effects of Smiley Faces in Restaurant Logos on Price and Healthfulness Perceptions. Journal of Advertising, 1-16.