Journal
JOURNAL OF MARKETING
Volume 79, Issue 2, Pages 62-78Publisher
SAGE PUBLICATIONS INC
DOI: 10.1509/jm.12.0408
Keywords
uncertainty; reference price; gambled price discounts; price promotion; marketing innovation
Categories
Ask authors/readers for more resources
In the context of price discounts, a special type of price promotion, in which savings depend on the outcome of a gamble and are thus uncertain, has recently achieved some popularity. The question arises as to whether such gambled price discounts (GPDs) incur the negative reference price effect-that is, a downward shift in customers' internal reference price (IRP)-which is often associated with regular price discounts (RPDs). From several studies, including two longitudinal field experiments, the authors find that GPDs indeed alleviate the negative reference price effect: IRPs and actual repurchasing tend to be lower for RPDs than for GPDs and a no-discount control condition. Moreover, the authors explore the psychological underpinnings of these effects and show that the different consequences of GPDs versus RPDs on IRPs are more pronounced if information regarding product quality is limited. The authors demonstrate that findings are robust to variations of GPD discount levels and the probability of winning.
Authors
I am an author on this paper
Click your name to claim this paper and add it to your profile.
Reviews
Recommended
No Data Available