Why you never see the total coming
In 1998, Vicki Morwitz at New York University, Eric Greenleaf at NYU Stern, and Eric Johnson at Columbia ran a series of experiments on what they called “partitioned pricing” — breaking a single price into a base price plus mandatory surcharges. Their landmark finding, published in the Journal of Marketing Research: partitioned prices decrease consumers’ recalled total costs and increase their demand. When people see $16 + $3.99 + $2.88 + $2.50, they anchor on the $16 and mentally discount the rest.
”Consumers use the base price as an anchor and insufficiently adjust for the surcharges. The result is a systematic underestimation of total cost.”
Morwitz, Greenleaf & Johnson, Journal of Marketing Research (1998)
DoorDash’s fee structure is a textbook example. Each fee is individually small enough to dismiss — $2.50 here, $2.88 there. But they compound. Greenleaf, Johnson, Morwitz, and Shalev published a comprehensive review of 18 years of partitioned pricing research in the Journal of Consumer Psychology (2016) and found that the effect is robust across product categories: consumers consistently underestimate total prices when costs are split into components, especially when they can’t easily compute the sum.
6+Separate charges on a typical DoorDash order
40-91%Total markup over in-store price
$16The anchor price your brain fixates on
Abraham and Hamilton confirmed this in their 2018 meta-analysis in the Journal of Marketing Research, synthesizing 149 observations across 27 studies (N = 12,878). Their finding: consumers respond more favorably to partitioned pricing when the total price is absent and when surcharges seem “typical for the product category.” Delivery fees have become so normalized that most people don’t question them at all.
Sources: Morwitz, Greenleaf & Johnson, “Divide and Prosper,” Journal of Marketing Research (1998); Greenleaf et al., “The price does not include additional taxes, fees, and surcharges,” Journal of Consumer Psychology (2016); Abraham & Hamilton, “When Does Partitioned Pricing Lead to More Favorable Consumer Preferences?” Journal of Marketing Research (2018)