Reframing the Discount as a Comparison Against the Sale Price: Does It Make the Discount More Attractive?

Abhijit Guha, Dhruv Grewal, Abhijit Biswas, Swati Verma, Somak Banerjee, Jens Nordfält

Research output: Contribution to journalArticlepeer-review

17 Citations (Scopus)

Abstract

Sales induced through price promotions depend heavily on discount depth, so firms create mechanisms to influence perceptions of discount depth. Typically, consumers compute discount depth as the difference between the sale price and the original price, with this difference compared against the original price. But thus far, no research has examined the effect of reframing this difference by comparing the discount depth against the sale price. Multiple studies, including a field study across four grocery stores, show that framing the discount depth by comparing it against the sale price increases consumers’ discount depth perceptions and thus increases purchase intentions. As evidence of the underlying process, the authors identify boundary conditions related to both individual differences (numeracy) and managerially relevant factors (discount depth size). In addition to contributing to research on price promotions, behavioral pricing, and numeric processing, the article offers implications for both practitioners and policy makers focused on consumer welfare.
Original languageEnglish
Pages (from-to)339-351
Number of pages13
JournalJournal of Marketing Research
Volume55
Issue number3
Early online date6 Jan 2018
DOIs
Publication statusPublished - 1 Jun 2018

Keywords

  • Discount depth
  • Price discounts
  • Price promotions
  • Pricing
  • Retailing

ASJC Scopus subject areas

  • Business and International Management
  • Economics and Econometrics
  • Marketing

Fingerprint Dive into the research topics of 'Reframing the Discount as a Comparison Against the Sale Price: Does It Make the Discount More Attractive?'. Together they form a unique fingerprint.

Cite this