[Pricing Nugget #003] The Best Cheesecake Only Plastic Can Buy

I am a cheesecake addict. Now it is public.

Some time ago, I spent a few days in Copenhagen with my family (if you have never been to Copenhagen, definitely go; if you already have been to Copenhagen, you know why).

Wandering a tiny street, we found a small bakery selling cheesecake—nothing else. One kind of cheesecake looks more delicious than the other. Only one thought popped up: “This is cheesecake heaven.”

Then I recognized a sign that took me slightly off-guard: “CARDS Only.”

In my experience, small shops would most likely ask for the opposite.

Next, my eyes caught the price tag. Wow, where I am coming from, for this price, I could pretty much buy two or three slices.

[By the way, I cannot tell whether this price was excessive in Copenhagen. At least my internal reference price was far lower.]

But who cares – it does not hurt, just swipe your credit card. Rehearsing my thought, I had to smile. This reasoning is exactly the ‘credit card effect’ that has been studied for a long time and has been repeatedly confirmed: people buy more and at higher prices when paying with a credit card instead of cash. 

This is one of those situations when you are consciously aware of the effect that is going on, and you actually know better, but you still fall prey (and pay a ridiculous amount for a cake).

I swiped, and I regretted nothing. This has been the best cheesecake for quite a while and probably THE BEST cheesecake only plastic can buy.

What does it mean for your offline business?

It needs not to be as radical as in the example above when you totally reject cash, but in general, you should make it easier to pay electronically and less painful for your customer to part from money.


Feinberg, Richard A. (1986), “Credit cards as spending facilitating stimuli. A conditioning interpretation,” Journal of Consumer Research, 13 (3), 348–356.
Hirschman, Elizabeth C. (1979), “Differences in consumer purchase behavior by credit card payment system,” Journal of Consumer Research, 6 (1), 58–66.
Prelec, Dražen and Duncan I. Simester (2001), “Always leave home without it. A further investigation of the credit-card effect on willingness to pay,” Marketing Letters, 12 (1), 5–12