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The Long-Term Effects of Sales Promotions on Brand Attitude Across Monetary and Non-Monetary Promotions
Abstract
This study compares the influences of sales promotions on brand attitude across promotional types over time. An experiment is conducted with 154 subjects who are exposed to test materials for 12 weeks. Evidence shows that the effects of sales promotions on brand attitude depend on the types of deals in the long run. Non-monetary promotion seems to work better in eliciting consumers’ favorable brand attitude than monetary promotion over time. However, such effects are moderated by consumers’ deal proneness, which appears to interfere with the interaction between deal types and brand attitude. Although monetary promotion can induce more negative effects than non-monetary promotion, these effects are weaker in the high deal prone group than in the low deal prone group.
... Value is "determined by adding the utility of benefits received -the worth the customer gets -and by subtracting the price paid -what and how customers give up in exchange (Smith, 2020, p. 482) or "the trade-off of the product's perceived quality relative to its perceived price" (Chen et al., 1998). Consumers' perception of deal value is contingent on promotion type since different promotion types are perceived as offering different benefits (Yi & Yoo, 2011). For instance, monetary promotions such as price discounts, percentage off offers, and coupons are perceived as offering utilitarian benefits including monetary savings, improved product quality, and shopping convenience while non-monetary promotions like bonus packs, premiums, and sampling offer more hedonic benefits -opportunities ...
... On the other hand, others conclude that evidence supports that there are potential adverse effects of sales promotion including decreased brand loyalty and perceived decrease in brand quality (Keller, 1998). In addition, sales promotions have been found to influence brand attitude over time, but that influence varies by promotion type (Yi & Yoo, 2011). Furthermore, research indicates nonmonetary promotions such as free gifts, bonus packs, contest, and buy one get one offers tend to elicit a more favorable brand attitude than monetary promotions which include price discounts, coupons, and rebates (Yi & Yoo, 2011). ...
... In addition, sales promotions have been found to influence brand attitude over time, but that influence varies by promotion type (Yi & Yoo, 2011). Furthermore, research indicates nonmonetary promotions such as free gifts, bonus packs, contest, and buy one get one offers tend to elicit a more favorable brand attitude than monetary promotions which include price discounts, coupons, and rebates (Yi & Yoo, 2011). Repeated monetary promotions are especially susceptible to less favorable brand attitudes by lowering consumers' reference price resulting in negative price-quality inference (Yi & Yoo, 2011). ...
As marketers continue to spend more and more on sales promotions, it is increasingly important for them to consider and understand how consumers evaluate and respond to these offers as well as what influence the offers have on consumer brand attitude. This is especially significant for small businesses as their resources, including promotion budgets, are usually substantially less than their larger counterparts. Therefore, it is essential that small businesses implement marketing strategies that generate the greatest return. One such strategy is the usage of sales promotions. However, in order to accomplish this, small business managers must understand the sales promotion landscape and recognize that it extends beyond simple discounts or coupons. Further, all sales promotions are not created equal, at least not in the eyes of consumers. Whether a sales promotion is deemed as a good offer is contingent upon more than just the promotion type. Rather, marketers must be cognitive of the roles of framing, consumer type, familiarity with the brand, consumer purchase involvement, and frequency of promotion and consider the influence of each variable on the consumer’s perception of the offer and attitude towards the brand. In keeping with the Small Business Institute Journal’s primary purpose of publishing practical, applied research, this article offers practitioners a practical review for understanding the sales promotion landscape, consumer perceptions of deal value, and the potential influence of sales promotions on brand attitude as well as provides considerations for implementing a sales promotions strategy.
... However, research on promotions remains limited, even though many agencies are already running specific, contest-based promotions, such as incentives for the best blogs, or the best holiday photos (Schmallegger & Carson, 2008). There is a lack of research analysing the influence of promotions on perceptions and behaviour either the promotion/sales relationship (Yi & Yoo, 2011) or the influence of sales promotions on consumer behavioural intentions (Christou, 2011). However, the influence of promotions may go beyond sales; they can also alter consumer perceptions of brands (Hunt & Keaveney, 1994), and attitudes (Crespo & Del Barrio, 2016), which in turn may influence behaviour. ...
... Promotional incentives are a key motivator to encourage customer engagement. Promotional incentives are defined as monetary benefits, in the form of discounts or discounted promotions for a product/service (Yi & Yoo, 2011). Promotional strategies have been studied and investigated in past literature. ...
... Some studies suggest that monetary incentives positively affect motivation of customers to engage with brands in online communities. Previous studies identified various types of promotions and defined monetary promotions as the popular and attract more research attention (Yi & Yoo, 2011;Christou, 2011;Sinha & Smith, 2000). More recently, the internet and social media have emerged as new likely to have continuance of intentions of using a website. ...
During the recent Covid-19 pandemic SMEs in the hospitality sector had to develop new ways of increasing consumer engagement and maintaining business activity. This study examines the effect of using blogs to counter the detrimental effect of pandemic lockdowns. A survey method was deployed with 449 respondents. Analysis used SEM PLS. The findings show trustworthiness and reputation positively affects credibility, but promotional incentives and expertise do not affect credibility. The findings also suggest that unverified information sharing mediates the relationship between credibility and loyalty. Information System (IS) researchers can systematically develop approach using big data to identify false information. This research contributes to knowledge of both IS researchers and SMEs in hospitality sector. SMEs in hospitality sector can partner IS and use this research as an example of method for recovering from crisis by the adoption of blog posts, as well as working remotely with IS researchers to explore data sources and research techniques to investigate false information.
... Although there is an extensive body of research on sales promotions (Anderson & Fox, 2019;Brito & Hammond, 2007;Freo, 2005;Pauwels et al., 2002;Yi & Yoo, 2011), understanding the effect of several types of promotions and their dimensions in sales is still limited. Some problems are solved when research breaks promotions into their typologies, ascertaining their characteristics and benefits to consumers and companies. ...
... Managers use different promotion types to achieve a specific sales objective (Yi & Yoo, 2011). As for their consumer incentive strategy, they classify into two distinct groups (Ogden et al., 2017;Shama et al., 2021): a) monetary or price-oriented promotions, such as discounts, coupons, and rebates; and b) nonmonetary or non-price-oriented promotions, such as free samples, gifts, prizes, sweepstakes, and contests. ...
... The effect of this promotion on the average billing size is slightly negative, but it only occurs significantly during the end of the promotion. Thus, the present research demonstrates that non-monetary promotional activity generates positive results in sales performance, corroborating Lowe and Barnes (2012), Reid et al. (2015), and Yi and Yoo (2011). ...
Monetary and non-monetary promotions can be effective in different sales performance metrics but may not last after the post-promotional period. Breaking down promotions into their typologies, dimensions, and performance metrics can clear up the cloudiness of promotional effectiveness. The study investigates the dynamic effect (immediate and short-term) of the behavioral dimensions of promotions (presence, duration, simultaneity, and removal) on sales performance metrics (revenue, number of transactions, and average billing size). The authors conducted longitudinal research at a retailer. The results show that non-monetary and monetary promotions generate immediate and short-term positive effects on revenue and the number of transactions with a positive balance after their ending. Nevertheless, the monetary one harms the average billing size after the promotional period, and the mixed one has opposite effects to the results above. The operant behavioral economics framework helps explain the results by proposing mutually reinforced relationships between consumers and companies.
... We argue that empirical evidence could help the promotion literature better elucidate the moderating influence of this link. Many studies have investigated promotions from positive and negative perspectives [7,8] to temporal (in)consistency [9,10]; the direct and moderating roles by which M-promotions translate into dynamic consumer behavior are not well documented. It is crucial to understand the role of M-promotions because the mobile service providers market is highly competitive. ...
... That is, consumers' favorable experience of a specific mobile device, their desire to use the device in the future, and the impact of M-promotions that enhance a new perception of the brand increase repurchase intentions. Consequently, Mpromotions can facilitate consumer actions to fully experience a specific brand with which they identify [10]. Hypothesis 1. M-promotions enhance the effect of brand attitudes on repurchase intentions. ...
... We used existing published measures of marketing promotion and repurchasing-related constructs needed to test the proposed hypotheses. We measured brand attitude using four items (Cronbach's alpha = 0.81) adapted from Raghubir and Corfman [46] and Yi and Yoo [10]. Moreover, functional quality was measured using four items (Cronbach's alpha = 0.74) adapted from Yong [47]. ...
Little empirical evidence is obtained for the moderating outcomes of mobile promotions (M-promotions) during subsequent repurchasing events. This study examines how M-promotions indirectly influence repurchase intentions, and how the level of promotions moderates the relationship between repurchase intentions and their determinants. The findings show that three determinants (i.e., brand attitude, functional quality, and online reviews) directly lead to repurchase intention. However, the moderating effects of M-promotions vary. Especially, our findings show that the moderating effect of M-promotions is only significant in the relationship between functional quality and repurchase intentions and that between online reviews and repurchase intentions. Repurchase intentions are increased by high M-promotions when functional quality is low, and when online reviews are positive.
... Our study also demonstrates that the different effects of monetary and non-monetary offers, as highlighted in sales promotion research (e.g., Buil et al. 2013;Reid et al. 2015;Büttner et al. 2014;Yi and Yoo 2011;Chandon et al. 2000), are applicable to the context of value-in-use, whereby monetary offers have a stronger effect than non-monetary offers. Moreover, our results point out that the number and type of customer-relevant offers only affect overall value-in-use through positive value-inuse components and do not influence irritation as a negative component. ...
... Based on the assumption that the number of K available relevant offers determines the content quality of a mobile LBS, we assume that an increased number of transmitted relevant offers during an inner-city trip has a positive influence on the perception of the benefits (and a negative influence on the irritation) associated with their use, and thus increases the overall value-in-use. The literature classifies sales promotions into two main types: monetary (e.g., price discounts and coupons) and non-monetary offers (e.g., free gifts, free samples, sweepstakes, and assortment information) (e.g., Büttner et al. 2014;Yi and Yoo 2011;Gedenk et al. 2010;Chandon et al. 2000). In this context, existing research on sales promotion shows that monetary and non-monetary offers differ in terms of both their effectiveness and customers' perceptions. ...
... Research on sales promotions has focused mainly on monetary promotions, whereby the relevance of non-monetary promotions is continuously increasing, and research has focused on the different effects of both types. In general, monetary promotions are more efficient in the short term than non-monetary promotions (e.g., Alvarez and Casielles 2005;Gilbert and Jackaria 2002;Chandon et al. 2000); however, they are also associated with more long-term risks (e.g., Buil et al. 2013;Yi and Yoo 2011;Mela et al. 1997). Furthermore, it has been shown that the perceived benefits of both types of promotion, which go beyond purely monetary benefits, are different. ...
Mobile location-based services (LBS) represent a promising opportunity for inner-city retailers and service providers to react to changes in customer behavior due to digitalization. To gain competitive advantages, mobile LBS must offer customers high value-in-use and help them reach their shopping goals during their inner-city visits. Shopping goals differ depending on shopping patterns; thus, these patterns may influence customers’ evaluation of mobile LBS during inner-city visits. Since value-in-use is not only a context-specific but also a temporally dynamic construct, customers’ user experience must also be considered. Therefore, this study investigates the influence of customers’ shopping patterns and current user experience on their evaluation of mobile LBS’ value-in-use during inner-city visits. Moreover, the impacts of the offers transmitted through mobile LBS on the value-in-use are examined.
Using field test data, we empirically verify a conceptualization of mobile LBS and determine a comprehensive view of mobile LBS’ value-in-use during shopping trips with different shopping patterns and user experience within a mixed-method analysis. Our results identify both utilitarian and hedonic value-in-use components as being empirically relevant for high value-in-use evaluations regarding mobile LBS in inner cities. Furthermore, the relevance of monetary benefits, fun benefits, and irritation on value-in-use vary according to customers’ user experience. A customer’s shopping pattern affects the value-in-use of mobile LBS; however, this effect is not as differentiated as expected. Moreover, the number of relevant monetary and non-monetary offers transmitted during an inner-city visit are shown to represent a potential, albeit limited, management instrument for affecting mobile LBS’ value-in-use.
... Customer attitudes take an essential role in the success of sales promotion applications. Previous studies have provided tenable evidence for the mechanism behind the linkage between sales promotion and consumer attitudes (Mussol et al., 2019;Yi and Yoo, 2011). Sales promotion arouses positive stable consumer behaviors such as consumer attitude and perception of quality, loyalty and switching costs (Nguyen-Phuoc et al., 2020). ...
... Sales promotion arouses positive stable consumer behaviors such as consumer attitude and perception of quality, loyalty and switching costs (Nguyen-Phuoc et al., 2020). According to Yi and Yoo (2011), non-monetary promotions have more favorable effects on brand attitude than monetary promotions in the long run. Recently, in retail setting, Mussol et al. (2019) confirmed the significant positive effects of in-store monetary and non-monetary sales promotion on perceived brand expression and brand attitude in the ice cream category. ...
... Turning to the three retailer-based factors, the measurement scale for promotion sales towards SGP practices was developed based on the conceptualization of sales promotions explored by Diamond and Johnson (1990). Accordingly, sales promotions included monetary promotions or non-monetary promotions that were then empirically tested in the relationship with brand equity (Gilbert and Jackaria, 2002;Yi and Yoo, 2011). A focus group interview was conducted with five managers of successful grocery store chains in Danang, Vietnam to modify measurement items for sale promotions towards sustainable packaging practices which were initially developed based on the foundation of two types of monetary promotions and non-monetary promotions. ...
The study constructed an integrated model of behavior towards shopping at retailers practicing sustainable grocery packaging (SGP) from the influences of intra-personal and retailer-based contextual factors. A questionnaire-based survey was employed to collect data from grocery shoppers at modern grocery retailers in a developing Asian country-Vietnam. By using Partial Least Square-Structural Equation Modeling, the proposed model was empirically tested with a sample of 478 respondents. The study found the direct influences of environmental lifestyle and retailers’ environmental reputation on shopping behavior concerning sustainable packaging. Two personal factors (environmental knowledge of sustainable packaging and green self-identity) and two marketing stimuli factors (sales promotion and advertisement) had indirect effects on behavior via attitude towards shopping at retailers practicing SGP. The study is the first to provide an understanding of consumer behavior concerning sustainable packaging from both internal and external perspectives. Practical implications are also provided for marketing and management of grocery retailers.
... Previous studies on sales promotion have analysed the impact of sales promotion on consumer behavior from different perspectives. Consumers' reactions to sales promotions (D'Astous & Landreville, 2003;Hamlin, Lindsay, & Insch, 2012); deal proneness (Palazon & Ballester, 2011); impact of sales promotion on brand (Dawes, 2004;Alvarez & Casielles, 2005;Palazon & Ballester, 2005;Yi & Yoo, 2011;Valette-Florence, Guizani, & Merunka, 2011); the relationship between promotions and product category (Nijs et al., 2001;Dawes, 2004;Banerjee, 2009); effectiveness of sales promotion types (Gupta, 1988;Chandon, Wansink, &Laurent, 2000;Gilbert & Jackaria, 2002); comparison of price and non-price promotion effectiveness (Chandon et al., 2000;Yi & Yoo, 2011;Dahl & Johnsson, 2015); marketers' attitude toward sales promotions (Huff, Alden, & Tietje, 1999;Huff & Alden, 2000); and impact of demographic factors on sales promotion responses (Carpenter & Moore, 2008;Boland, Connell, & Erickson, 2012;Jamal, Peattie, & Peattie, 2012;Yoon Kin Tong, Piew Lai, & Fa Tong, 2012;McNeill, Fam, & Chung, 2014) are among the topics that are studied in the literature. ...
... Previous studies on sales promotion have analysed the impact of sales promotion on consumer behavior from different perspectives. Consumers' reactions to sales promotions (D'Astous & Landreville, 2003;Hamlin, Lindsay, & Insch, 2012); deal proneness (Palazon & Ballester, 2011); impact of sales promotion on brand (Dawes, 2004;Alvarez & Casielles, 2005;Palazon & Ballester, 2005;Yi & Yoo, 2011;Valette-Florence, Guizani, & Merunka, 2011); the relationship between promotions and product category (Nijs et al., 2001;Dawes, 2004;Banerjee, 2009); effectiveness of sales promotion types (Gupta, 1988;Chandon, Wansink, &Laurent, 2000;Gilbert & Jackaria, 2002); comparison of price and non-price promotion effectiveness (Chandon et al., 2000;Yi & Yoo, 2011;Dahl & Johnsson, 2015); marketers' attitude toward sales promotions (Huff, Alden, & Tietje, 1999;Huff & Alden, 2000); and impact of demographic factors on sales promotion responses (Carpenter & Moore, 2008;Boland, Connell, & Erickson, 2012;Jamal, Peattie, & Peattie, 2012;Yoon Kin Tong, Piew Lai, & Fa Tong, 2012;McNeill, Fam, & Chung, 2014) are among the topics that are studied in the literature. ...
... Price promotions have been criticized for several reasons. It is argued that price reductions may lower the reference price effect (Sinha &Smith, 2000), damage the brand image, and downgrade the quality perceptions of the product (Yoo, Donthu, & Lee, 2000;Darke &Chung, 2005;Banerjee, 2009;Yi & Yoo, 2011). ...
The aim of this study is to investigate the influence of sales promotional tools on consumer buying behavior in an emerging market at the post-recession period. This study assesses consumers' proneness to sales promotions and examines the effectiveness of four promotional tools that are premium offers, coupons, buy and get promotions, and price discounts on buying behavior in terms of brand switching, stockpiling, purchase acceleration, and product trial. The findings reveal that consumers are more prone to price discount and buy and get promotions, respectively. Among the four promotional tools, price discount is the most effective to influence product acceleration, brand switching, stockpiling, and product trial behavior respectively. However, there is no statistically significance difference between the effectiveness of premium offer and buy and get deals with regard to brand switching behavior, product acceleration, and product trail responses. In contrast, coupons are the least ineffective promotional tool in terms of generating all types of consumer response.
... The sales promotion is stressed in the growing competition. Companies' overall expenditure on sales promotions is constantly increasing, outweighing spending on advertising (Chu and Keh, 2006;Huff et al., 1999;Yi and Yoo, 2011). Specifically, the average annual growth of spending on sales promotion between 2013 and 2017 recorded 3.7 per cent, whereas it was 2.4 per cent for advertising (Statista, 2018). ...
... The difference in processing sales promotions also influences how consumers assess the promoted product. As a monetary promotion is encoded as a reduced loss from the comparable full price (Sinha and Smith, 2000), the discount price becomes readily available, producing negative price-quality inference and reducing consumers' evaluation of the promoted product (Raghubir and Corfman, 1999;Yi and Yoo, 2011). For a free gift promotion, the focal product's full price is used maintaining the value of the product, since correcting for the value of the gift is difficult (Campbell and Diamond, 1990). ...
... Based on these findings, a fair amount of research has claimed that the virtue of free gift promotions lies in increasing sales without hurting the value of promoted products, whereas monetary promotions have adverse effects (Darke and Chung, 2005;Liu and Chou, 2015). Free gift promotions also maintain positive brand perceptions such as brand image and brand equity (Buil et al., 2013a;Crespo-Almendros and Del Barrio-García, 2016;Palazon-Vidal and Delgado-Ballester, 2005), brand attitude (Chou and Lien, 2012;Yoo, 2011) andpost-promotion brand preference (DelVecchio et al., 2006). More recent studies investigate moderating factors regarding promotional design (Chou and Lien, 2012;Palazon and Delgado-Ballester, 2009a), product characteristics When free gifts hurt the promoted product (Lowe, 2010) and individual characteristics (Crespo-Almendros and Del Barrio-García, 2016;Kwok and Uncles, 2005;Palazon and Delgado-Ballester, 2009b;Palazon and Delgado-Ballester, 2011). ...
Purpose
The present study aims to demonstrate that providing a free gift upon purchase may induce consumers to devaluate the main product promoted with the offer. The mediating role of persuasion knowledge and the moderating role of consumer shopping orientation are also examined.
Design/methodology/approach
Three studies with between-subject designs are conducted to test the influence of product–gift fit on evaluations of the promoted product.
Findings
When a low-fit gift (vs a high-fit gift) is provided as a promotional offer, consumers’ evaluations of the promoted product are undermined. These negative effects are driven by consumers’ activation of persuasion knowledge on the company’s ulterior motive to entice consumers to make a purchase. Such devaluation effects occur especially for consumers with a task-focused shopping orientation, whereas they are mitigated for consumers with an experiential shopping orientation.
Research limitations/implications
This research extends the conceptualization of product–gift fit and challenges the common claim that free gift promotions maintain the value of the promoted product. By instigating a mechanism underlying consumers’ objections toward low-fit gifts, this research implies that consumers may think of an implicit cost to a free offer based on their knowledge of companies’ tactics.
Practical implications
Marketers should be aware of the fact that a certain gift may come at a cost for companies and bring about negative inferences regarding the main product. They need not only to select a gift that drives sales but also to be cautious about the gift’s influence on perceptions of the main product. Marketers should ensure that the gift has a good fit with the product while trying to discover a unique gift for consumers. Marketers should also provide an offer that matches shopping orientation of the target consumers.
Originality/value
This research reveals counterevidence to prior research claiming that free gift promotion does not hurt the perceived value of the promoted product. It enhances a theoretical understanding of devaluation effects and provides useful implications for designing and targeting free gift promotion.
... Contudo, no geral, promoções de preços, por exemplo, a redução de preços a curto prazo, vendas especiais, cupons distribuídos, ofertas e descontos, podem desgastar o valor da marca ao longo do tempo, apesar do ganho financeiro de curto prazo (Aaker, 1998;Yoo et al., 2000;Valette-Florence et al., 2011;Yi, & Yoo, 2011). Valette-Florence et al. (2011) observam que as promoções podem ter um impacto negativo sobre o valor da marca, porque as promoções repetidas oferecem sinais de menor qualidade ou indicações de que a marca precisa de promoções para justificar a consideração dos consumidores em efetivar a compra. ...
... Com relação ao aspecto promocional, as promoções monetárias não geraram resultados positivos para as marcas, corroborando a literatura (Aaker, 1998;Yoo et al., 2000;Valette-Florence et al., 2011;Yi, & Yoo, 2011;Salinas et al., 2007), e contradizendo Gholami et al. (2016), que apontam que as promoções monetárias têm efeito significativo e positivo sobre as dimensões de brand equity. O estudo enfatiza que promoções monetárias (descontos nos preços) não geram resultados positivos para as marcas, diluindo a qualidade e imagem da marca e afetando o preço referência do produto em questão. ...
O estudo verifica a influência das propagandas e das promoções em vendas sobre o customer-based brand equity de marcas de posicionamentos distintos do mesmo segmento de mercado de chocolates finos: Kopenhagen e Cacau Show. Baseado em survey com 414 respondentes em modelo de equações estruturais, os resultados demonstram que, para as propagandas, quantidade não remete à qualidade e criatividade, originalidade e diferenciação contribuem positivamente para a consciência de marca, percepção de qualidade e associações. As promoções monetárias exercem influência negativa sobre a percepção de qualidade e associações à marca. Tais implicações contribuem gerencialmente com as estratégias em marketing visando o valor de marca com foco no consumidor. Palavras-chave: Propaganda. Promoção. CBBE. Marca premium. Mix de marketing.
... The academic literature has investigated promotion effects in terms of different types of promotions, including direct discounts (e.g., [32,53]), quantity discounts (e.g., [2,71]), coupons (e.g., [37,44]), promotional games (e.g., [40,45]), reward programs (e.g., [31,56]), and rebates (e.g., [15,61]). Some previous studies (e.g., [12,30,66]) compared the effects of different types of promotions on consumer purchasing behavior. For example, Kivetz and Zheng [30] compared the effects of direct price promotions and quantity promotions on generating consumer purchasing behavior. ...
... The findings of this study contribute to the existing promotion literature in three ways. First, our study contributes to previous comparative studies of the different impacts of various types of promotions (e.g., [30,66]) by providing a more comprehensive framework for comparison using a three-level hierarchical promotion structure. Our comparison includes monetary and nonmonetary promotions, standardized and nonstandardized monetary promotions, and direct, quantity, and bundle promotions within the standardized monetary promotion type. ...
Facing fierce competition, e-commerce platforms are implementing various promotional strategies to attract consumers. Based on real-world transaction data from the largest online retailer in China, JD.com, this study builds a three-level hierarchical promotion structure and evaluates the impact of different platform promotions on sales and conversion rate. We find that monetary promotions have a stronger impact on sales than gift promotions. Among monetary promotions, standard promotions are more influential than coupon promotions. And among standard promotions, direct and quantity promotions are more effective than bundle promotions. Moreover, we find that the platforms' business model (i.e., reseller or marketplace) and product line length have significant moderating effects on the impact of quantity promotions on both sales and the conversion rate, while the moderating effects on direct promotions are only observed on its impact on sales. Our findings offer guidelines for e-commerce platforms to implement efficient promotion strategies to improve their performance by generating online consumer purchase intention and behavior based on the business model and product line length.
... Monetary promotions are often a prepotent when consumers are looking for utilitarian benefits (versus hedonic benefits) (Reid et al., 2015). Non-monetary promotion has an advantage for a longterm relationship, whereas monetary promotion is effective for short-term goals (Yi and Yoo, 2011). Therefore, this study examines the relationship between sport consumers' motivations and the effectiveness of two types of promotions that influence their intention to visit a sport museum; monetary promotions and non-monetary promotions. ...
... To effectively use promotions as a tool to attract people to a sports museum, marketers need to understand when and how to utilize them. Considering that monetary promotion and non-monetary promotions can be effective in different situations for different people (Yi and Yoo, 2011), understanding effective promotion management is imperative for sport museum marketers. This study contributes to the literature of promotion studies by investigating the two types of promotions in a sports museum setting, presenting the different effects of promotion types depending on the visitors' motivations. ...
Purpose
Although sport museums are considered an important sector in nostalgia sport tourism, annual visitations of the major sport Hall of Fames (HoF) have been decreasing, often resulting in operational and financial difficulties for the HoF. The current study examined the relationship between sport museum image, motivation, constraints, monetary and non-monetary promotions (as a mediator), and visit intention among those who have attended or never attended.
Design/methodology/approach
Data was collected from the residents in the Northeast Ohio area via an online survey questionnaire using Qualtrics ( N = 1,607). Two sets of data parameters were generated based on consumers previous visitation to Pro Football HoF (visited group n = 754; never-visited group n = 853) and each group's monetary and non-monetary promotion models (total of four models) were analyzed. Descriptive statistics and reliability tests were processed via IBM SPSS Statistics 26 and the structural relationships among the constructs were examined using SmartPLS 3.
Findings
Among all the antecedents, positive perceived image of HoF has been identified as the most significant predictor for both promotions and visit (revisit) intention. Social motivation was found to be a strong driver for visiting a sports museum regardless of the types of promotions. Promotions' mediation effects were found. The monetary promotion between cost constraints and visit intention implied, cost constraints can be mitigated through monetary promotion.
Originality/value
This is the first study examining the role of relationship between image, motivation, constraints and visit intention relative to sport museums. Results provide practical insights for the sport museum marketers and researchers relative to visit intension.
... The use of social media has a positive and significant effect on increasing customer activity and ultimately impacts sales performance, the number of customers that can be reached, and the operating profit achieved [62]; [12]. Therefore, SMEs in the restaurant sector during the Covid-19 pandemic are obliged to start using social media promotion media [61]. ...
... Furthermore, the promotion strategy has also been updated by adopting developments in information technology, especially now that with the Covid-19 pandemic, the market is more silent at home and always looking for information through social media, so the promotion strategy used by many SMEs is the social media promotion strategy. Social media promotion also shows an increase in business performance [62]; [43]. Furthermore, in the new normal life order, many rules must be obeyed, so the market is more comfortable getting food purchased at home. ...
The purpose of this study is to develop a business strategy concept for SMEs in the restaurant sector during the COVID 19 pandemic. The approach used is to analyze and synthesize the literature on the concept of business strategy and the factors that influence the choice of business strategy, namely entrepreneurial orientation and its impact on business performance. The research was conducted on SMEs in the restaurant sector to clarify the implementation of business strategies during the COVID 19 pandemic. The results of the study were the development of a conceptual model of business strategies to maintain business performance. The limitation of this article lies in only developing a conceptual model based on previous empirical studies. This research implies that it can help the next researcher to test the validity of the resulting model.
... 194-195), Бил и кол. потвърждават тяхната противоположна роля спрямо монетарните промоции при генерирането на ценност на бранда, а Йи и Йо отчитат и положителното им влияние върху нагласите към марката (Yi & Yoo, 2011, АЛМАНАХ "НАУЧНИ ИЗСЛЕДВАНИЯ", том 27, 2019г., стр. 279 -307 АИ "Ценов" -Свищов, ISNN 1312 pp. ...
... Докато монетарните промоции категорично водят до понижени оценки на бранда и понижаване на потребителската лоялност, то немонетарните не само не вредят на марката, но и допринасят за изграждането на двата конструкта. Резултатите са в съгласие с други изследвания, като потвърждават благоприятната роля на немонетарните промоции при изграждането на силен бранд (Yi & Yoo, 2011;Kumar & Patra, 2017). ...
Abstract: The present research outlines the effects of consumer promotions. Its subject is the type and frequency effects of consumer promotions on customer-based brand equity dimensions. The leading role of consumer promotions within the communication mix, both nationally and globally, along with the lack of unambiguous evidence about their effect on brand equity as a top intangible asset, underlie the motivation of the current research. The present work aims to confirm the research thesis that consumer promotions can generate both positive and negative effects on customer-based brand equity depending on their type and frequency. The negative effects of monetary promotions and positive effects of nonmonetary promotions and promotions frequency on perceived quality and brand loyalty are estimated by structural equation modeling and finite mixture approach. The segmentation analysis provides estimates of the effects according to the degree of brand loyalty. According to the results, monetary promotions are more appropriate for the non-loyal segment, while nonmonetary promotions are more appropriate for the loyal segment.
... There are several studies that show that promotion proneness is one of the primary moderators of consumer response to sales promotions [67][68][69]. Consumers who are prone to promotion modify their purchasing behavior to benefit from the temporary incentive offered by the sales promotion. This implies that the consumer's propensity to take advantage of discounts is a result of their intention-at a cognitive level-to redeem that discount [70]. ...
Social media marketing communication is among the current strategies used to provide visibility to cultural heritage, sales promotions being especially relevant. Nevertheless, despite the fact that social media has now built significant momentum, there is still a dearth of research on the relationship between social marketing activities and brand equity. In this context, this study seeks to determine how the use of promotional discounts and free gifts on social media contributes to building heritage brand equity. To pursue this research aim, a quasi-experimental study was designed and carried out among online users, based on two promotional stimuli (discount vs. free gift). The findings suggest that gifts perform better in terms of increasing brand equity, except where the user presents a high level of sales promotion-proneness, in which case promotional discounts are more effective.
... In fact, while there is an agreement about the positive short-term (ST) impact of retail advertising, its long-term (LT) impact on sales and consumer preferences remains contentious. The marketing literature suggests that some retail advertising activities can negatively impact brand preference in the long run (Ataman et al., 2010;Buil et al., 2013;DelVecchio et al., 2006;Herrington & Dempsey, 2005;Yi & Yoo, 2011). This has led manufacturers such as Toyota, Yamaha, Mitsubishi, Honda and many others to proscribe specific retail advertising that features prices below invoice, or that does not obey certain specifications for brand advertising (Barkholz, 2015;TastyAd, 2018;Yamaha co-op advertising guidelines, 2016). ...
The profitability of cooperative advertising (CA) programs is analyzed in a supply chain where competing manufacturers sell their products through competing retailers. We study a two-period game-theoretic model that accounts for positive and negative long-term effects of retail advertising on consumer preferences. We obtain closed-form equilibria in two particular cases where either the stores or the products are perfectly differentiated. For the general case where both products and stores can be substitutable, we develop a numerical algorithm to find the equilibrium. We compare the equilibria obtained in games where CA is offered and where it is not. The results show that the second-period effects of first-period retail advertising and the levels of substitutability between products and between retailers all play a key role in assessing the profitability of CA programs. CA only benefits manufacturers when store and product competition are both low, or when retailers are highly differentiated. However, in most cases, retailers do not find such programs profitable except when product substitutability levels are high while store competition is low. Finally, CA can only be win-win arrangements for manufacturers and retailers when the level of store differentiation is very high, the products are moderately substitutable, and first-period retail advertising has a substantial positive impact on second-period sales. The manufacturers’ cooperative advertising support rates increase with the second-period effects of retail advertising.
... Many researchers recommended this kind of promotion because it is not having any harmful impact on the brand value of a product; in fact, it is helpful in enhancing the brand value of the product. In the longrun perspective, non-monetary promotion is considered more favorable compared to monetary promotions (Yi & Yoo, 2011). ...
Not all business in the market get customer attentions as they deserve, especially for Small Medium Enterprise (SME). It sparks fierce competition between SME to stand out from rivals in the market. Sales promotion is known as one of the most effective method which influence sales volume, especially for SME’s market. The second strategy is having endorsement from a third-party. Previous studies have identified impact of monetary promotion through online and in-store strategy to build strong brand identity without, and so as endorsement. However, there is still inadequate understanding of branding development particularly what specific promotions and endorsement works better for SME, as previous research are mostly based on multinational or big firms which have different characteristics with SME. Therefore, this paper examine the impact of two types of promotions, which are: monetary (vs non-monetary) promotion and celebrity (vs.non-celebrity) endoresement into better customer perceptions about SMEs’ product and brand.
... In contrast, non-monetary promotions, such as invitations to exclusive in-store events and sweepstakes, provide hedonic benefits to consumers that include exploration and entertainment (Büttner et al., 2015). Retailers use non-monetary promotions for brandbuilding and developing stronger relationships with consumers (Büttner et al., 2015;Chandon et al., 2000;Yi and Yoo, 2011). ...
Purpose
This paper aims to investigate whether customer satisfaction varies when presented with different types of omnichannel promotions (shopping goal-congruent vs shopping goal-incongruent and monetary vs non-monetary promotions) and if the effect on satisfaction is mediated by service excellence. In addition, this paper examines whether consumers respond differently to these promotions when shopping for utilitarian or hedonic products or when they have an inherent utilitarian or hedonic shopping motivation.
Design/methodology/approach
Two online shopping scenario experiments are conducted. Study 1 ( n = 1,034) differentiates effects of omnichannel promotions between hedonic and utilitarian product categories. Study 2 ( n = 345) contrasts hedonic and utilitarian shopping motivation in the same product category.
Findings
The findings in this paper demonstrate positive effects from both presenting a shopping goal congruent and a monetary promotion in an omnichannel setting on customer satisfaction. The positive effects are explained by service excellence and are demonstrated to be attenuated in the hedonic product category and for consumers with a hedonic shopping motivation.
Research limitations/implications
The effect of omnichannel promotions was demonstrated using a scenario-based experimental approach, future research should use field experiments.
Practical implications
The findings in this paper demonstrate practical implications for a retailer who wishes to optimize its omnichannel promotion strategy across channels and touchpoints.
Originality/value
To date there is little directions for retailers on how to optimize their omnichannel promotion strategy. This paper contributes to research and practice by demonstrating that shopping goal-congruent promotions (vs in-congruent) and monetary promotions (vs non-monetary) increase customer satisfaction more in an omnichannel context. The effects are enhanced for utilitarian (vs hedonic) products/shopping motivation.
... Consumers discount the value of the promoted product when offered with a free gift (Chang, 2009;Diamond, 1990;Park and Yi, 2019), and consumers perceive products on a price discount as having lower quality based on negative price-quality inference (Raghubir and Corfman, 1999;Darke and Chung, 2005). Offering a discount also exacerbates the good cause of a brand (Kim and Han, 2020), and harms consumers' evaluation of the brand in the long term (Yi and Yoo, 2011). Moreover, consumers may fear about making a negative social impression through a price deal (Ashworth et al., 2005;Kim and Yi 2016). ...
The main purpose of this research is to investigate whether, why, and when givers and recipients perceive the value of a discounted gift differently. The studies provide convergent evidence that givers perceive discounted gifts as less valuable than regular-priced gifts whereas recipients do not perceive them as different. Givers' devaluation of the discounted gift is driven by their concern about the thoughtfulness of a gift. Moreover, the giver-recipient asymmetry is mitigated when the in-store interaction with a salesperson is substituted by technology via a service robot. This research contributes to the gift-giving literature and the growing literature on service robots by revealing how promotional offers influence consumers’ evaluation of gifts and how technological advance in retail may affect the proposed effect. Managerial implications for planning and executing price promotions for gifts are also discussed.
... Further, precise delivery of explanation and mechanism of how customers can claim and receive financial rewards such as cashback, redeemable point, and other prizes affects the usefulness of MP. Monetary promotions are like two sides of a coin, one side attracts people to use the system more while the other shows adverse effects if the mechanism, process, and detail of promotions are not clear, confusing, and not as promised (Yi and Yoo, 2011), especially for the customer with significant experience in MP usage. ...
Purpose–This study aims to propose a theoretical model to explain mobile payment (MP) continuanceusage in a physical store in Indonesia from a habit perspective. In detail, continuance usage was arguedto be a consequence of habitual behavior which is related to specific actions conducted automatically,repeatedly and frequently. Therefore, the theoretical model was constructed on the theory of habitestablishment.
Design/methodology/approach–In total, 220 Indonesian respondents were used to examine thetheoretical model. Furthermore, a cross-sectional study was used through the use of a descriptivestatistical approach to preparing data and descriptive analyses and structural equation modelingmethod for analysis.
Findings–Satisfaction was found to have the most substantial direct influence on the establishment ofhabit to use MP followed by perceived usefulness and perceived compatibility. Meanwhile, dealproneness and social ties were discovered to have a significant indirect effect on habit through themediation of usefulness.
Originality/value–This study used the theory of habit formation to understand how user developsrepeated behavior in MP usage which leads to continuance usage of the platform. There is limited explicitexploration and development of a theory based on this concept, therefore, this study is a contribution tothe body of knowledge with respect to habit formation and its impacts on MP continuance usage
... Our empirical study on the effectiveness of in-app primary store registration confirms that hospitality apps should be utilized as a value co-creation or service co-production facilitator (i.e., pull lever) rather than a firm-initiated sales and promotional channel (i.e., push lever). In addition, CP events can be conducted without monetary promotions (e.g., coupons and discounts) that may increase marketing costs and damage brand image (Yi and Yoo, 2011). To increase the rate of mandatory CP, marketers can provide hospitality app users with non-monetary promotions, such as new product or event announcements, or useful information about why mandatory CP will be beneficial to participating customers in the future. ...
This paper empirically examines individual and joint effects of two types of customer participation (CP)—mandatory and replaceable—within a mobile app on bakery purchase behavior. This research conducts a field experiment to track customer decisions on whether to participate in in-app CP events—store loyalty program enrollment and store satisfaction survey—and whether to change their purchasing amount and frequency. After controlling other influencing factors, the authors performed ANOVA with the sample of 19,065 bakery customers’ behavioral decisions. The results confirm that mandatory CP has a positive effect on purchase behavior, while replaceable CP has mixed effects across stores. In addition, the results confirm that customers who engaged in both types of CP increased their purchase amount and frequency, compared to customers who engaged in one type or neither. The study suggests hospitality firms should motivate customers to engage in mandatory and replaceable CP to enhance customer loyalty cost-effectively.
... İletişim araçlarından parasal satış promosyonları da marka denkliği yaratma süreci açısından dikkate alınması gereken bir konudur. İlgili yazında da belirtildiği üzere, bir markanın sıklıkla parasal satış promosyonu kullanması uzun vadede tüketicilerin söz konusu markaya yönelik tutumlarını olumsuz yönde etkileyebilmektedir (Yi ve Yoo, 2011). Bu çalışmanın bulguları da bu olumsuz etkiyi kısmen destekler niteliktedir. ...
... Roll and Pfeiffer, 2017;Lee and Yi, 2019). A price discount is a monetary promotion, whereas a gift is a type of nonmonetary promotion that can better induce consumers' favorable brand attitudes (Yi and Yoo, 2011) and has hedonic benefits related to emotion (Chandon et al., 2000). Moreover, in a free trial, a proportion of a firm's own products or services on the market is offered for free to facilitate the start of a customer's product experience and to reduce customer-perceived quality uncertainty (Shoemaker and Shoaf 1975;Jamieson and Bass 1989). ...
Purpose
This study aims to investigate the effect of acquisition modes on customer behavioral loyalty to enrich our knowledge of the effectiveness of acquisition modes and how to better target customers in the service industry.
Design/methodology/approach
Using a data set from a large commercial bank in China, this study conducts a series of empirical analyses to examine the impacts of two types of acquisition modes (i.e. the gift acquisition mode and customer referral) on customer behavioral loyalty.
Findings
Gift acquisition has a negative effect on customer behavioral loyalty, as measured by the dropout probability, consumption amount and consumption frequency. Furthermore, this negative relationship could be weakened if the customer is referred by an existing customer.
Originality/value
Although prior studies have investigated the effectiveness of some acquisition modes in terms of customer loyalty, customer acquisition through the provision of gifts, which is widely implemented in marketing practice, has not been well investigated. This study addresses this research gap and identifies the joint influence of acquisition modes on customer behavioral loyalty, further enriching our knowledge of the effectiveness of different acquisition modes.
... Generally, many extant studies show that marketing promotions increase the sales of products and brands in the short run (Santini et al., 2016;Wierenga and Soethoudt, 2010;Yusuf, 2010). Specifically, price (monetary) promotions have a stronger impact on purchase decisions as compared with non-monetary promotions (Ehrenberg et al., 1994;Pauwels et al., 2002;Yi and Yoo, 2011). Price promotions are more effective with regard to products that have high price elasticity and intense competition (Shankar and Krishnamurthi, 1996). ...
Anecdotal evidence has shown that retail price promotions can help small and medium-sized retailers enhance their sales, and thus profits. However, most marketing managers usually stop a promotion after a certain duration. This study aims to explain why these retailers discontinue their price promotion. Our approach posits that overall contributions of a price promotion to the product profit progressively diminish with time. In this study, we present a theoretical framework to explain the relationship between duration and profit effects of price promotion and propose statistical models to empirically examine this framework using point-of-sale (POS) data. Our findings provide empirical support that the effect of price promotion on the product profit has a downward trend with elapsed time. The results are helpful for marketers to understand how price promotions dynamically influence product profit and when the promotion should be terminated.
... al., 2003;Liao and Ze, 2006;Liao et. al., 2009;Yi and Yoo, 2011). In these studies, factors such as brand attitudes towards sales promotion activities, the effect of sales promotion activities on brand value perception, and whether the consumer buys the product more after sales engagement activities are analyzed. ...
In an increasingly competitive environment, it is essential for brands to differentiate themselves because of the similarity of products, services, solutions and prices offered. Therefore, sales promotion activities carried out on social media become more and more important day by day in order to promote the newly released product, to make potential customers become existing customers, to increase the loyalty of existing customers, to remind the products that have begun to be forgotten, and to increase product sales. This study was carried out in order to reveal this importance. Therefore, the main purpose of this study is to reveal the effects of sales promotion activities on social media on the product preferences of consumers, and in line with this purpose, a questionnaire was made to the customers of a Fitness company in Istanbul. The customers also have a social media account and these customers follow this company on social media. The participants were examined whether the sales promotion activities of the company in question on social media were effective in choosing this company. 205 people participated in the study, and the study lasted one month. The survey consists of 30 questions and three parts. In the first part, demographic questions were asked to the participants. In the second part, questions were asked in order to reveal the general preference tendencies of the consumers towards the products with sales promotion on social media. In the third part, questions were asked in order to measure which sales promotion activities on social media would result in the product choice of consumers. As a result of the study, a statistically significant relationship was found between the coupon, buy one get one, price discount and a free sample campaign applied by the fitness company on social media, and the product preference of the consumer.
... For instance, Kramer and Kim (2007) find that consumer perceptions of coupon deals framed as potential gains can achieve better promotion effect than deals framed as loss-reduction. Yi and Yoo (2011) suggest that consumers prefer the non-monetary promotions described as acquisition relative to monetary promotions described as loss-reduction. In contrast, Gendall et al. (2006) find that loss-reduction promotions can lead to better sales than profit-increase promotion. ...
In mobile commerce, the elderly have become a consumer group that cannot be ignored. Based on the framing effect theory, our paper mainly investigates the impacts of regulatory focus and reinforcement on the purchase intention of elderly mobile app consumers. The results of our empirical analysis show that the influence of the promotion framing on the perceived value and expected regret of the elderly consumers is regulated by the reinforcement and the regulatory focus. Specifically, for promotion focus elderly consumers, profit-increase promotions generally bring higher anticipated regret than loss-reduction promotions, while for prevention focus elderly consumers, loss-reduction promotions generally bring higher anticipated regret than profit-increase promotions. Our results also demonstrate that perceived value and expected regret play a mediating role in mobile apps’ use of the promotion framing to influence consumers’ purchase intention.
... A large body of marketing studies shows that consumers use price (Dawar and Parker 1994;Rao and Monroe 1989) and advertising (Kirmani 1990;Kirmani and Wright 1989) as signals of product quality. Past research in marketing has further found that price promotions damage brand attitude (Yi and Yoo 2011), brand loyalty (Papatla and Krishnamurthy 1996), and brand equity (Yoo et al. 2000). Based on the above discussion, we expect that CTB is positively affected by the brand's advertising intensity, new product introduction intensity, distribution intensity, and price, and negatively affected by the brand's price promotion intensity. ...
The essence of a brand is that it delivers on its promises. However, consumers’ trust in brands (CTB) has declined around the world in recent decades. As a result, CTB has become a major concern for managers. The authors examine whether CTB is influenced by marketing-mix activities (i.e., advertising, new product introduction, distribution, price, and price promotion) implemented by brands. The authors propose and show that the sensitivity of CTB to marketing-mix activities is moderated by consumer, category, and country characteristics, using a multisource data set consisting of a survey of 15,073 respondents and scanner panel data on 589 brands in 46 CPG categories across 13 countries (including the four largest emerging markets), which collectively account for half of the world’s population. The authors find strong positive effects for advertising and new product introduction intensity, weak positive effects for price and distribution intensity, and a minor negative effect for price promotion intensity on CTB. Furthermore, the authors find that the effect of marketing-mix activities on CTB is moderated by consumers’ personality traits, consumers’ reliance on brands in a category, and countries’ secular-rational and self-expression cultural values.
... Extant research shows that sales promotions erode brand equity and quality perceptions of the promoted product (Aaker, 1996;Mela, Gupta, & Lehmann, 1997;Dodson, Tybout, & Sternthal, 1978, Jedidi, Mela, & Gupta, 1999, Yoo, Donthu, & Lee, 2000, Yi & Yoo, 2011. However, marketing practitioners use promotions heavily and the share of promotions in their advertisement budget is increasing (Blattberg, Briesch, & Fox, 1995;Nikabadi, Safui, & Agheshlouei, 2015;Ong, 1999;Poddar & Donthu, 2011;Spethman, 1998). ...
Brand Equity erosion due to non-consumer franchise building (non-CFB) sales promotions have been a recurring theme in extant literature. However, the disproportionate increase in non- CFB promotion activities by companies contradicts this academic view. This research provides a rationale for this inconsistency by examining the moderating impact of brand loyalty on the promotion – brand equity relationship. Results indicate that loyalty moderates the promotion-brand equity relationship, and even short term promotions enhance brand equity in certain market segments (like those dominated by spurious loyals). Practitioners can target specific loyalty groups through short term promotions without impacting Brand Equity.
... Many researchers recommend this type of promotion because it does not have any harmful effect on the brand value of a product; in fact, it is helpful in enhancing the brand value of the product (Mela et al., 1997). In the long-run perspective, non-monetary promotions are considered more favorable compared to monetary promotions (Yi and Yoo, 2011). Non-monetary promotions never spoil the brand image and may even assist in creating one (Mela et al., 1997). ...
The purpose behind the development of this research article is to assess the impact of sales promotions benefits on consumer perceived value and examine the moderating effect of product categories on the relation between sales promotions, their benefits, and consumer perceived value. The study used a sample of 400 consumers from India and ‘Structure Equation Modelling’ technique is applied to evaluate the research assumption. Finally, the moderating effect of the product category is evaluated by utilizing ‘Multi-Group Analysis' technique. Research findings reveal that the product category moderates the consumer's perceived value for hedonic and utilitarian benefits of sales promotion tools. It is found that utilitarian benefits of sales promotion have more impact on consumer perceived value in the context of personal care product while hedonic benefits are having more impact on consumer perceived value in the context of food products. A sales promotion plan can be made more effective when it is hedonic benefit oriented in the case of food products and utilitarian benefit oriented in the case of personal care products. The findings of this research can be useful for marketers to develop an effective sales promotion strategy considering the category wise differential impact of sales promotions benefits.
... An explanation for this finding is that monetary promotion increases the price gap between private label and national brands to an extent which elicits favorability of private label brands in the eyes of non-private label consumers. It has been asserted that sales promotions can evoke positive effect on brand attitude in the short term (Yi and Yoo, 2011). The impact can be even profound for students who have been described as more engaging and attracted by promotional activities (Huang et al., 2014). ...
Purpose
The purpose of this paper is to propose and empirically test a research model encompassing marketing mix activities as antecedents of non-private label consumers’ switching intention, particularly from an emerging market perspective. The study also aims to test the moderating role of general neophobia and gender.
Design/methodology/approach
Focusing on non-private label consumers, the study analyzed a total of 211 questionnaire responses. Partial least squares structural equation modeling was used to test the research model.
Findings
The results suggested that marketing mix activities, particularly advertising, in-store communication, and monetary promotion positively influenced private label brand attitude. Attitude positively influenced switching intention. The proposed moderating effects of general neophobia and gender in the relationship between private label brand attitude and switching intention were supported.
Originality/value
This study provides empirical evidence to the effects of marketing practices on private label brand attitude from an emerging market perspective, complementing previous research which largely focused on developed market. The findings offer managerial ideas in targeting non-private label consumers. The test of moderating variables expands the understanding on attitude-intention link.
... Still, according to the same framework, and in line with the recent study on price promotions by Eisenbeiss et al. (2015), we acknowledge that (pure) discounts enhance the consumers' focus on the benefits generated by possible monetary savings, which represent a utilitarian benefit. Aaker (1991) and Yi and Yoo (2011) elaborated that nonmonetary price promotions lead consumers to focus more on hedonic values, which leads to more positive long-term effects on brand performance and brand preference in comparison to discount promotions, independent of the product category on offer. ...
... Long-term influence of coupons on brand value differs across deal categories, and non-monetary promotions had an affirmative effect on brand value as compared with financial promotions. Less deal-prone shoppers show significant differences in their attitudes towards financial and non-financial promotions as compared with strong deal-prone shoppers (Yi & Yoo, 2011). This investigation is exposed that consumers' perceptions towards gift promotions. ...
Parasal ve parasal olmayan satış tutundurma araçları müşterileri farklı şekillerde etkilemektedir. Alan incelenmesi yapıldığında özellikle yerli literatürde parasal ve parasal olmayan tutundurma araçlarının tüketiciler nezdinde ayrımının yapıldığı çalışma sayısının oldukça az olması bu çalışmanın yapılmasının gerekçesini oluşturmaktadır. Buradan hareketle bu araştırmanın amacı satış tutundurma araçlarından parasal ve parasal olmayan satış tutundurmanın marka tercihi ve marka güveni üzerindeki etkisini incelemektir. Söz konusu amaç doğrultusunda Bayburt Üniversitesi öğrencileri üzerinde ankete dayalı bir alan araştırması gerçekleştirilmiştir. Kota örnekleme yöntemine göre toplam 500 öğrencinin olduğu bir örneklem grubundan veriler toplanmıştır. Elde edilen veriler SPSS 21 ve AMOS 24 istatistik paket programları aracılığı test edilmiştir. Kullanılan ölçeklerin geçerlilik ve güvenilirliklerinin test edilmesi amacıyla sırasıyla açımlayıcı faktör analizleri ve Cronbach Alpha analizleri yapılmıştır. Hipotez testleri için yapısal eşitlik modelinin kullanıldığı çalışma sonucunda hem parasal satış tutundurmanın hem de parasal olmayan satış tutundurmanın marka tercihi ve marka güvenini pozitif bir şekilde etkilediği ancak parasal satış tutundurma araçlarının marka güveni ve tercihine etkisinin parasal olmayan satış tutundurma araçlarından daha fazla olduğu ortaya çıkmıştır. Yine marka güveninin de marka tercihi üzerinde pozitif bir etkisinin olduğu görülmüştür.
We estimate the causal effects of different targeted email promotions on the opening and purchase decisions of the consumers who receive them.
Tüketicilerin satın alma karar süreci demografik, sosyal, kültürel, kişisel, psikolojik faktörlerin ya da pazarlama araçları tarafından şekillenen faktörlerin etkisi altında ortaya çıkmaktadır. Bu anlamda dışsal ve içsel faktörler olarak ele alınabilecek olan bu türden faktörler, tüketicilerin zihninde gerçekleşen değerlendirmeyi etkileyerek bazı yanıtlar (tepkiler) meydana getirmektedir. Bu araştırma, sanal mağaza atmosferi, satış promosyonları, akış deneyimi ve impulsif satın alma değişkenleri arasındaki ilişkileri S-O-R paradigması kapsamında incelemeyi amaçlamıştır. Bu doğrultuda sanal mağaza atmosferi ve satış promosyonları dışsal uyaranlar, akış deneyimi organizma (zihinsel süreç) ve impulsif satın alma bir tüketici tepkisi olarak ele alınmış ve bir nicel araştırma kapsamında araştırmanın teorik modeli değerlendirilmiştir. Araştırmanın verilerini online anket yoluyla erişilen 407 tüketicinin yanıtları oluşturmuş ve veriler SPSS 24 ve AMOS 24 istatistik yazılımlarında çözümlenmiştir. Yapılan analizler sonucunda iyi uyum iyiliği gösteren bir yapısal eşitlik modeli kapsamında elde edilen bulgular, sanal mağaza atmosferi, satış promosyonları, akış deneyimi ve impulsif satın alma davranışı arasında istatistiksel olarak anlamlı ilişkiler bulunduğunu ortaya koymuştur. Sonuçlara göre akış deneyimi, hem sanal mağaza atmosferi ile impulsif satın alma arasında hem de satış promosyonları ile impulsif satın alma arasında aracılık rolü üstlenmektedir. Ayrıca sosyo-demografik özellikler ile alışveriş alışkanlıklarına ilişkin bazı faktörlerin istatistiksel olarak anlamlı gruplararası farklılıklar sergilediği ortaya çıkmıştır.
Purpose
Shopping apps are a highly relevant channel and an increasingly important part of omni-channel retailing, as they strengthen the customer relationship. This study analyses the possibilities available to retailers to encourage consumers to download a shopping app and use it in the long-term.
Design/methodology/approach
The study uses a scenario-based online experiment with a 2 × 2 × 2 between-subjects design and data from 332 participants. A second online experiment with a 2 × 3 between-subjects design and data from 200 participants supplements the main experiment. The data obtained from these experiments were analysed using M/ANCOVA and PROCESS.
Findings
Findings suggest that a rebate (monetary incentive) increases the download intention. Online and in-store app features (non-monetary incentives) do also have positive impacts on the use intention, though the in-store feature only works when it is offered in combination with the online feature. The relationships are mediated by the perceived usefulness of the shopping app. Moreover, the non-monetary features interact with the channel preference of the consumers, who react more positively towards features offered in a non-preferred channel. A supplementary study supports this finding.
Originality/value
This research is novel as it analyses the impact of monetary (rebate) and non-monetary (online and in-store features) incentives on both the download and use intention of a shopping app separately. Further, it contributes to research on the topic by examining which features consumers perceive as useful. Finally, the study considers the omni-channel environment regarding consumers’ channel preference.
Purpose
This study aims to explore the moderating outcomes of mobile promotions in three parts. First, Study 1 is conducted to discover the moderating effect of mobile promotions when consumers initially purchase a restaurant service. Second, Study 2 investigates how the promotion level during subsequent purchasing events moderates the relationship between attitudes toward selecting a restaurant brand (ATRB) and repurchase intentions. Third, the study compares mobile promotion effects between the initial purchase stage and subsequent purchase state.
Design/methodology/approach
Two studies are conducted to test the hypotheses. Using a longitudinal survey, Study 1 demonstrates the moderating role of mobile promotions (M-promotions) during the initial restaurant choice stage (T). Study 2 extends these findings to the reordering stage (T+1).
Findings
The results of Study 1 show that price discounts are much more impactful than free delivery when food quality and online reviews are positive. Study 2 shows that price discounts have more substantial effects than gifts at time T+1 when ATRB is positive. The findings are relevant to both scholars and managers, adding insights to discussions on promotions arising from the evolution of consumption experiences.
Research limitations/implications
Promotions differ in financial value; hence, comparisons of promotional packages may vary during subsequent purchase states, helping to explain subsequent promotion stages and enabling scholars to understand their impact on the food reordering context.
Originality/value
The fact that no empirical studies have examined the roles of M-promotions during subsequent purchasing stages constitutes a significant gap in extant promotion research. Therefore, this study seeks to fill this gap by providing robust evidence to demonstrate these effects and related temporal mechanisms. Additionally, although the literature on promotion is used mostly in cross-sectional studies, this study addresses a common challenge to reveal dynamics of promotion levels during subsequent consumption periods.
Although marketing managers consider consumer mind-set regarding brand strength a key performance measure of advertising on the premise that it mediates the effect on sales, they rarely consider its moderating influence on advertising effectiveness. This study assumes recall-based brand consideration as a measure of consumers’ mind-sets regarding brand strength and explores the moderating role of brand consideration in the short term and the carryover advertising effect on sales. The results reveal that while brand strength has a limited mediating effect, it has a positive moderating influence on the carryover advertising effect and, to a lesser extent, the short-term advertising effect.
This study examined the effect of mobile operator promotions (MOP) on customer purchase intentions using longitudinal survey data (over two phases in a two-year period) from mobile phone consumers in South Korea. Results indicated that MOP led indirectly to repurchase intentions, but moderated mediation effects varied across time points. MOP appears primarily to moderate brand attitudes, which strongly influence repurchase intentions. Specifically, the direct effect appears between purchase intentions at time T and repurchase intentions at T + 1; however, the moderating influence of MOP is limited in these timeframes.
In-store displays aim to boost sales of both utilitarian and hedonic products. Noting typical differences in the information processing and purchase behavior evoked by these product types, and building on congruency theory principles, the authors propose that different types of in-store displays (i.e., island, end-of-aisle, or shelf signage) are more appropriate for utilitarian versus hedonic products, and the use of price or product promotions might reinforce these effects. With a database that combines three data sources (scanner, observational, and survey), this article presents an analysis of a market share model at the SKU level. The results confirm that in-store displays have differential effects on sales, depending on their characteristics; congruency between the decision-making process of utilitarian versus hedonic products and the characteristics of in-store display types moderates their effectiveness in terms of SKU sales. Shelf signage strongly increases the sales of utilitarian products, whereas island and end-of-aisle displays increase sales of hedonic product categories more effectively. The use of congruent promotions creates synergistic influences that reinforce these effects. In particular, price promotions improve the impact of shelf signage on utilitarian products, and product promotions strengthen the impacts of island and end-of-aisle displays on hedonic products. These results extend prior research on in-store marketing actions and the nature of utilitarian versus hedonic products, as well as providing recommendations for retailers and manufacturers seeking to optimize their retail space and commercial budgets.
MOnetary and non-monetary promotions are very evident in e-commerce. Consumer comes across them while making purchase decisions. This study brings in the perspective of how consumer leverages the two types of promotion when they choose to make their e-purchase. Study focuses on three service sectors (Ordering food online, booking ride online, and booking event tickets) and how consumer response differs across them for evaluating two categories of promotion. Consumer budget also plays an important role. It changes the consumer shopping orientation as well as the evaluation of promotion while making a purchase decision. Study also shows that gender plays a significant role while evaluating monetary promotion; however, non-monetary promotions are no different for them. The findings of the study has implications for e-retailers to implement their promotional strategies more efficiently.
Brand is a financial asset for any business that is looking for a great prosperity in today"s world. Despite this fact; most of businesses in start-up have drawn a slight consideration in finding out whether their brands are delivering their promise to customers. The aim of this study is to examine factors influencing successful start-up Brands at Mikindani Municipality. A survey design was adopted and a random sampling strategy was employed in selecting 270 business categories from a total population of 824 registered businesses. Structured questionnaires were used in data collection of which two hundred and seventy (270) questionnaires were returned and processed. Data were analyzed through descriptive statistics as well as Correlation and Regression analysis were also used to analyses the relationship between the variables. The result revealed that, the challenges of branding have a significant impact on Start-up brand success. Moreover, information flow, financial resources and branding strategy are the only factors that have positive influence on Start-ups brand success. Other factors like advertisement and social media channels have been negated by the study been influential factors in Start-ups brand success in this case. In addition, financial cost, Time factor and branding Information accessibility have been found to be the limiting factors to best branding activities. Furthermore, the research brought managerial recommendations; whereas people should highly make effort on acquiring knowledge on branding because as the world is evolving branding is the key feature for a successful start-ups brand and SMEs. Changing consumer perception towards Start-up brand, Take a strategic move of using IMC (Integrated Marketing Communication) as it is more effective and efficient promotion technique in communicating Start-up brand value. On the other side the government should loosen up some ends especially on issues concerned with tax to enable Start-up brand move on.
Çalışmada parasal ve parasal olmayan satış tutundurma faaliyet- lerinin marka değeri ve marka değeri bileşenlerine nasıl bir etkide bu- lunduğu ve fırsat yatkınlığı, uyum ve ürün-satış tutundurma faaliye- tinin niteliği (hedonik-faydacı) değişkenlerinin (düzenleyici değişken) bu ilişkiyi nasıl etkilediği araştırılmıştır. Ankara’da yaşayan tüketicilere uygulanan 500 anket ile veriler toplanmış ve bu verilerin analizi ile araştırma sonuçlarına ulaşılmıştır. Araştırma bulgularına göre parasal ve parasal olmayan satış tutundurma faaliyetleri, marka değerine katkı sağlamaktadır. Ayrıca satış tutundurma faaliyetlerinin performansına etki edip etmediği araştırılan değişkenlerin satış tutundurma ve marka değeri ilişkisi üzerinde herhangi bir düzenleyici rolü olmadığı sonucuna ulaşılmıştır.
This study investigates the self-related motivations effects on willingness to boycott and buycott. In addition, we researched the moderator effects of materialism and anti-consumption on these effects. Finally, we examined the effect of participation willingness on consumers’ subjective well-being. The data was collected via online survey and demonstrated that moral obligation, expected efficacy and self-enhancement positively affect willingness to participate in boycott/buycott. It is also observed that materialism and anti-consumption moderate a number of relationships between self-related motivations and willingness to boycott and buycott. One of the major contributions of this study is the consumers’ different perceptions about boycott and buycott. Accordingly, consumers perceive buycott more positive than boycott. While buycott has positive effect on subjective well-being, boycott has no significant effect.
Marka ve marka bileşenleri pazarlama açısından önemli değerlerdir. Rekabet açısından marka, işletmelere farklılık, farkındalık ve imaj sağlamakta ve işletmeleri rakiplerinden bu yönleri ile ayrıştırmaktadır. Dolayısıyla gerek rekabet açısından gerekse tüketiciler açısından marka, farkındalık sağlayan, iletişimi kolaylaştıran ve duygusal ilişkiyi güçlendiren bir araçtır. Marka hikâyeleri de markanın bir bileşeni olarak tüketiciler ile iletişim sağlamada önemli bir argümandır. Firmalar marka hikâyeleri ile tüketicilerin zihninde farklı bir yer edinebilirler. Bu açıdan bu çalışmanın amacı marka hikâyelerinin tüketicilerde oluşturabileceği etkilerin belirlenmesidir. Bu amaca yönelik olarak iki ayrı örneklem grubunda anket çalışması uygulanmıştır. Elde edilen sonuçlara göre tüketiciler açısından marka hikâyeleri anlatı aktarımı, daha az eleştirel düşünce ve daha yüksek ağızdan ağıza aktarım niyeti taşımaktadır.
This study targets to measure the effect of dynamic
pricing offers on the purchase intentions of consumers for a winter holiday by
taking into consideration a moderated mediator role of perceived risk on this
effect. The study employs an experimental design with discount level and timing
of the offer (offer recency) as the manipulated conditions. The findings
confirm that discount offers have positive direct effect and perceived risk has
a negative direct effect on purchase intentions. The levels of discount and perceived
risk, independently from each other, determine the level of purchase
intentions. On the other hand, the effect of discount offers on purchase
intentions is mediated by the perceived risk level of consumers. Finally, the
timing of the discount offers moderates the effect of perceived risk on
purchase intentions and eventually generates a moderated mediation role for
perceived risk on the influence of discount offers on purchase intentions.
Based on the findings of this study, some practical implications are provided.
Purpose
The purpose of this paper is to use the game theory combined with Monte Carlo simulation modelling to support the analysis of different retail marketing strategies, in particular, using payoff matrices for modelling the likely outcomes from different retail marketing strategies.
Design/methodology/approach
Theoretical research was utilised to develop a practical approach for applying game theory to retail marketing strategies via payoff matrices combined with Monte Carlo simulation modelling.
Findings
Game theory combined with Monte Carlo simulation modelling can provide a formal approach to understanding consumer decision making in a retail environment, which can support the development of retail marketing strategies.
Research limitations/implications
Game theory combined with Monte Carlo simulation modelling can support the modelling of the interaction between retail marketing actions and consumer responses in a practical formal probabilistic manner, which can inform marketing strategies used by retail companies in a practical manner.
Practical implications
Game theory combined with Monte Carlo simulation modelling can provide a formalised mechanism for examining how consumers may respond to different retail marketing strategies.
Originality/value
The originality of this research is the practical application of game theory to retail marketing, in particular the use of payoff matrices combined with Monte Carlo simulation modelling to examine likely consumer behaviour in response to different retail marketing approaches.
Purpose
The purpose of this paper is to examine and compare the influence of age, education, income, product involvement and sales promotion (SP) characteristics on consumer attitudes towards SP across eight culturally dissimilar environments.
Design/methodology/approach
A multi-country mall intercept and mail survey was conducted in Brunei, China, Hong Kong, Indonesia, Malaysia, New Zealand, Singapore and Thailand (n=4,125 respondents).
Findings
Country, education level and income significantly influence consumer attitudes towards SP. Some countries show a significant monetary value interaction effect. Consumers using delayed-reward SPT reported a significantly more positive attitude towards SP. Discounts and coupons are the two most highly ranked SP across the sampled countries.
Research limitations/implications
Limitations include the use of intercept and mail sampling. Extending the study to include additional Asian countries and other regions would benefit the understanding of cultural influences on SP.
Practical implications
Multinational marketing managers should consider three aspects of SP implementation strategy: cultural and demographic factors, interaction between delayed-reward SP and socio-demographics variables; country specific SP preferences to promote both sales and brand equity.
Originality/value
This study investigates and extends research on SP across cultures. In particular the research helps better understand the impact of demographic factors and culture on attitudes towards SP, and implementation of global promotions.
A temporary discount can generate a lot of customer excitement, but the revenue effects can be short-lived. Price promotions commonly increase manufacturer revenue and depress retailer revenue in the short term but have no persistent effect, Promotions are tactical, not strategic, and they need to be managed that way.
In this article, we attempt to distinguish between the properties of moderator and mediator variables at a number of levels. First, we seek to make theorists and researchers aware of the importance of not using the terms moderator and mediator interchangeably by carefully elaborating, both conceptually and strategically, the many ways in which moderators and mediators differ. We then go beyond this largely pedagogical function and delineate the conceptual and strategic implications of making use of such distinctions with regard to a wide range of phenomena, including control and stress, attitudes, and personality traits. We also provide a specific compendium of analytic procedures appropriate for making the most effective use of the moderator and mediator distinction, both separately and in terms of a broader causal system that includes both moderators and mediators. (46 ref) (PsycINFO Database Record (c) 2012 APA, all rights reserved)
The authors examine the effects of a manufacturer coupon on brand choice behavior. The level of coupon redemption and changes in brand choice behavior after redemption are examined as a function of the household's prior probability of purchasing the promoted brand, likelihood of buying a favorite competitive brand, and coupon face value. A model of the coupon redemption decision is developed to predict response to the coupon promotion by different consumer segments. Predictions from the model are tested by using scanner panel data from a field experiment on coupon face values. Coupon redemption rates are found to be much higher among households that have purchased the brand on a regular basis in the past. The results also suggest that most consumers revert to their precoupon choice behavior immediately after their redemption purchase. These and other findings have important implications for the profitability of coupon promotions.
The authors investigate the conditions in which price promotions affect pretrial brand evaluations. A price promotion is theorized to be informative about brand quality when it stands out because it deviates from either its own past behavior or industry norms. Product category experts, who have alternative sources of information to make quality judgments, are expected to make less use of price promotions as a quality cue than novices are. The authors describe three laboratory studies in the context of a price promotion that is designed to increase trial in a service industry. Results suggest that consistency with past promotional behavior, distinctiveness in terms of how common it is to promote in an industry, and consumer expertise are important variables that moderate when price promotions have an unfavorable effect on brand evaluations. The authors highlight implications for service providers that are offering promotions to attract new customers in industries in which promotions are uncommon and discuss the theoretical implications of the finding that expertise moderates the effects of distinctiveness and consistency on evaluations in the context of price promotions.
Early research on the effect of promotion suggested that a brand using that element of the marketing mix would be evaluated lower and therefore have a reduced repurchase probability. Though that hypothesis refers to a change in brand evaluation at the individual level, tests of it typically have been performed with repurchase probabilities at the aggregate level. Recent work by Neslin and Shoemaker shows that it is possible to observe a decrease in aggregate repurchase probability due to promotion even if individual-level repurchase probabilities are unchanged. Though their evidence does not directly test the hypothesis of a negative effect for promotion, it does provide an alternative explanation for observed results. The authors expand their work by directly testing the hypothesis of a negative effect for promotion and by performing that test on the underlying construct, brand evaluation. After initial measurement of shoppers' evaluations, brands in test categories were promoted for three months. At the end of the promotion manipulation period, brand evaluations were remeasured. The hypothesis that overall evaluation of promoted brands would decrease is rejected.
Consistency among the various elements of a marketing program is believed essential in building and maintaining brand image and equity. And yet, a brand's ultimate presentation to customers is controlled more often by the retailer than by the manufacturer. In this research, the authors demonstrate that the retailer's display decisions can negate the equity of an established brand. The authors suggest that this occurs because consumers have expectations about retail displays and the relationship among displayed brands. Display conditions that disconfirm these expectations can lead consumers to reevaluate the brand. Specifically, the results demonstrate that high-equity brand valuations are influenced by an unfamiliar context brand when (1) a mixed display structure leads consumers to believe that the context brand is diagnostic for judging the high-equity brand, (2) the precedence given to one brand over another in the display makes expectations about brand differences or similarities accessible, and (3) the unfamiliar context brand disconfirms these expectations.
To what extent do price promotions have a long-term effect on the components of brand sales, namely, category incidence, brand choice, and purchase quantity? The authors answer this question by using persistence modeling on weekly sales data of a perishable and a storable product derived from a scanner panel. Their analysis reveals, first, that permanent promotion effects are virtually absent for each sales component. Next, the authors develop and apply an impulse response approach to estimate the promotional adjustment period and the total dynamic effects of a price promotion. Specifically, they calculate the long-term equivalent of Gupta's (1988) 14/84/2 breakdown of promotional effects. Because of positive adjustment effects for incidence but negative adjustment effects for choice, the authors find a reversal of the importance of category incidence and brand choice: 66/11/23 for the storable product and 58/39/3 for the perishable product. The authors discuss the implications of the findings and suggest some areas for further research.
The authors examine the long-term effects of promotion and advertising on consumers' brand choice behavior. They use 8 1/4 years of panel data for a frequently purchased packaged good to address two questions: (1) Do consumers' responses to marketing mix variables, such as price, change over a long period of time? (2) If yes, are these changes associated with changes in manufacturers'advertising and retailers'promotional policies? Using these results, the authors draw implications for manufacturers' pricing, advertising, and promotion policies. The authors use a two-stage approach, which permits them to assess the medium-term (quarterly) effects of advertising and promotion as well as their long-term (i.e., over an infinite horizon) effects. Their results are consistent with the hypotheses that consumers become more price and promotion sensitive over time because of reduced advertising and increased promotions.
Evidence suggests that some consumers react to promotion signals without considering relative price information. We adopt Petty and Cacioppo's Elaboration Likelihood Model (ELM) to explain this behavior in terms of the ELM's peripheral route to pursuasion in which the promotion signal is taken as a cue for a price cut. Experimental results show that low need for cognition individuals react to the simple presence of a promotion signal whether or not the price of the promoted brand is reduced, but that high need for cognition individuals react to a promotion signal only when it is accompanied by a substantive price reduction. Copyright 1990 by the University of Chicago.
The construction of a framework of the multiple consumer benefits of a sales promotion is discussed. Through a series of measurement studies, the authors find that monetary and nonmonetary promotions provide consumers with different levels of 3 hedonic benefits (opportunities for value expression, entertainment and exploration) and 3 utilitarian benefits (savings, higher product quality, and improved shopping convenience). To address the second question, the researchers develop a benefit congruency framework, which argues that a sales promotion's effectiveness is determined by the utilitarian or hedonic nature of the benefits it delivers and the congruence these benefits have with the promoted product. Among other results, 2 choice experiments show that as predicted for high-equity brands monetary promotions are more effective for utilitarian products than for hedonic products.
Consistency among the various elements of a marketing program is believed essential in building and maintaining brand image and equity. And yet, a brand's ultimate presentation to customers is controlled more often by the retailer than by the manufacturer. In this research, the authors demonstrate that the retailer's display decisions can negate the equity of an established brand. The authors suggest that this occurs because consumers have expectations about retail displays and the relationship among displayed brands. Display conditions that disconfirm these expectations can lead consumers to reevaluate the brand. Specifically, the results demonstrate that high-equity brand valuations are influenced by an unfamiliar context brand when (1) a mixed display structure leads consumers to believe that the context brand is diagnostic for judging the high-equity brand, (2) the precedence given to one brand over another in the display makes expectations about brand differences or similarities accessible, and (3) the unfamiliar context brand disconfirms these expectations.
In the context of three laboratory experiments ranging from a computer simulation of purchases to actual product use by subjects, the authors investigate how in-store price promotions affect market share after the promotions have been retracted. They find that the effects of promotion are contingent on both the choice patterns of subjects—whether or not subjects switch among brands—and the ubiquity of promotions in a product category. If only one brand is being promoted and subjects are generally loyal to the last brand purchased, brand choice probability declines from prepromotion levels once the promotion is withdrawn. However, if subjects tend to switch among brands in the absence of promotions, or if several brands are being promoted, this decline is mitigated and/or does not occur.
Early research on the effect of promotion suggested that a brand using that element of the marketing mix would be evaluated lower and therefore have a reduced repurchase probability. Though that hypothesis refers to a change in brand evaluation at the individual level, tests of it typically have been performed with repurchase probabilities at the aggregate level. Recent work by Neslin and Shoemaker shows that it is possible to observe a decrease in aggregate repurchase probability due to promotion even if individual-level repurchase probabilities are unchanged. Though their evidence does not directly test the hypothesis of a negative effect for promotion, it does provide an alternative explanation for observed results. The authors expand their work by directly testing the hypothesis of a negative effect for promotion and by performing that test on the underlying construct, brand evaluation. After initial measurement of shoppers’ evaluations, brands in test categories were promoted for three months. At the end of the promotion manipulation period, brand evaluations were remeasured. The hypothesis that overall evaluation of promoted brands would decrease is rejected.
The authors investigate the conditions in which price promotions affect pretrial brand evaluations. A price promotion is theorized to be informative about brand quality when it stands out because it deviates from either its own past behavior or industry norms. Product category experts, who have alternative sources of information to make quality judgments, are expected to make less use of price promotions as a quality cue than novices are. The authors describe three laboratory studies in the context of a price promotion that is designed to increase trial in a service industry. Results suggest that consistency with past promotional behavior, distinctiveness in terms of how common it is to promote in an industry, and consumer expertise are important variables that moderate when price promotions have an unfavorable effect on brand evaluations. The authors highlight implications for service providers that are offering promotions to attract new customers in industries in which promotions are uncommon and discuss the theoretical implications of the finding that expertise moderates the effects of distinctiveness and consistency on evaluations in the context of price promotions.
The authors examine the long-term effects of promotion and advertising on consumers’ brand choice behavior. They use 8 1/4 years of panel data for a frequently purchased packaged good to address two questions: (1) Do consumers’ responses to marketing mix variables, such as price, change over a long period of time? (2) If yes, are these changes associated with changes in manufacturers’ advertising and retailers’ promotional policies? Using these results, the authors draw implications for manufacturers’ pricing, advertising, and promotion policies. The authors use a two-stage approach, which permits them to assess the medium-term (quarterly) effects of advertising and promotion as well as their long-term (i.e., over an infinite horizon) effects. Their results are consistent with the hypotheses that consumers become more price and promotion sensitive over time because of reduced advertising and increased promotions.
The authors report results from a controlled experiment designed to investigate the impact of a brand's price promotion frequency and the depth of promotional price discounts on the price consumers expect to pay for that brand. A key feature of the work is that expected prices elicited directly from respondents in the experiment are used in the analysis, as opposed to the latent or surrogate measures of expected prices used in previous studies. As hypothesized, both the promotion frequency and the depth of price discounts are found to have a significant impact on price expectations. Evidence also supports a region of relative price insensitivity around the expected price, such that only price changes outside that region have a significant impact on consumer brand choice. Further, the authors find that consumer expectations of both price and promotional activities should be considered in explaining consumer brand choice behavior. Specifically, the presence of a promotional deal when one is not expected or the absence of a promotional deal when one is expected may have a significant impact on consumer brand choice. Finally, as in the case of price expectations, consumer response to promotion expectations is found to be asymmetric in that losses loom larger than gains.
The authors examine the effects of a manufacturer coupon on brand choice behavior. The level of coupon redemption and changes in brand choice behavior after redemption are examined as a function of the household's prior probability of purchasing the promoted brand, likelihood of buying a favorite competitive brand, and coupon face value. A model of the coupon redemption decision is developed to predict response to the coupon promotion by different consumer segments. Predictions from the model are tested by using scanner panel data from a field experiment on coupon face values. Coupon redemption rates are found to be much higher among households that have purchased the brand on a regular basis in the past. The results also suggest that most consumers revert to their precoupon choice behavior immediately after their redemption purchase. These and other findings have important implications for the profitability of coupon promotions.
Several authors have observed that average repeat rates are lower after a promotion purchase. One interpretation of this result is that a media-coupon or cents-off promotion undermines the consumer's repeat purchase rate. The authors describe an alternative explanation. The explanation is that the promotion temporarily attracts a disproportionate number of households with low purchase probabilities. When the repeat rates of these households are averaged with the repeat rates of those that would have bought the brand even without a promotion, the average rate after a promotion purchase is lower. This effect is demonstrated by means of a numerical example, a closed-form equation for repeat rates, a Monté Carlo purchase simulation, and a logit choice model. An exploratory empirical analysis supports these arguments. Implications for marketing management, research methodology, and future research are discussed.
Promotions are being used with increasing frequency by manufacturers facing highly competitive markets, which is causing concern among some marketers who feel that frequent promotions can hurt a brand. Nevertheless, there is little empirical evidence to either support or dispel such fears. To fill this gap in the literature, the authors propose a brand choice model that provides an estimate of the dynamic effects of promotions on loyalty to the brand and customers’ sensitivity to the price of the brand, and measures whether promotional purchases reinforce or reduce subsequent response to similar promotions. They estimate a random effects heteroskedastic covariance probit time-varying parameter model on household scanner panel data from the liquid detergent category. Their results indicate that increased purchases using coupons erode brand loyalty and increase price sensitivity. In addition, the authors find that the effect of features and displays on brand choice is reinforced by prior feature and display purchases, respectivly, as well as by feature and display purchases associated with price cuts. Future research directions are also discussed.
The effectiveness of a sales promotion can be examined by decomposing the sales “bump” during the promotion period into sales increase due to brand switching, purchase time acceleration, and stockpiling. The author proposes a method for such a decomposition whereby brand sales are considered the result of consumer decisions about when, what, and how much to buy. The impact of marketing variables on these three consumer decisions is captured by an Erlang-2 interpurchase time model, a multinomial logit model of brand choice, and a cumulative logit model of purchase quantity. The models are estimated with IRI scanner panel data for regular ground coffee. The results indicate that more than 84% of the sales increase due to promotion comes from brand switching (a very small part of which may be switching between different sizes of the same brand). Purchase acceleration in time accounts for less than 14% of the sales increase, whereas stockpiling due to promotion is a negligible phenomenon accounting for less than 2% of the sales increase.
Research has shown that brands with higher deal frequency obtain a smaller market share gain on deal and have a lower expected price. However, the level of dealing must be perceived by consumers before it can affect consumer response to promotions. Hence, perception of deal frequency may affect consumer price perceptions and deal response much more strongly than the actual deal frequency. The author determines how consumer perceptions of deal frequency for a brand may be influenced by the dealing pattern of that brand and of other brands. She shows that the price consumers are willing to pay for a brand is correlated more highly with perceived deal frequency than with actual deal frequency. She also shows that the price consumers are willing to pay is correlated with the actual deal frequency of the brand for certain dealing patterns, but not for others.
When consumers are exposed to pricing and promotional activity by frequently purchased packaged goods, they may develop expectations that are used as points of reference in evaluating future activity. The authors build a model to test for the presence of these reference effects on brand choice behavior. The approach differs from previous research in two ways: (1) the model includes reference effects of promotion in addition to reference effects of price and (2) a threshold model is introduced to capture the formation of the consumer's promotional reference point. The authors calibrate a model of brand choice using IRI scanner panel data on ground coffee. The findings suggest that promotional activity has significant reference effects on consumer response.
In a replicated in-store factorial experiment with 12 national brands in six nonperishable consumer goods categories, the authors find price deal elasticities in the [2–11] range, with larger values for smaller brands. Those elasticities increase 20% to 180% when deals are advertised by the retailer; the rates of increase are smaller for the leading brands. The price deal cross-elasticities of the higher priced brands are found to be smaller than those of the other brands; they are in the [2–2.7] range. Optimal retail deal rates are shown to be robust to model specification.
Analysis of panel data for two consumer packaged goods indicates that media-distributed coupons and cents-off deals induce brand switching and result in less loyalty when retracted than if no deal is offered. In contrast, package coupons stimulate brand loyalty which is maintained when they are retracted. The extent to which economic utility theory and self-perception theory order these findings is evaluated and the implications of the results for managing demand are discussed.
An emerging consensus in marketing is that consumers respond to price relative to some standard or reference price. Most researchers modeling brand choice have reasoned that this standard is based on past prices of the brand. The authors argue that consumers do use reference prices, but one that is also based on context—other prices in the store—rather than on past prices alone. An analysis of households’ brand choices in two subcategories and over three cities supports this premise. Within context, the lowest price seems to be an important cue for reference price, whereas within time, a brand's own past prices seem to be the most important cue. Households’ use of a contextual reference price also varies predictably across some consumer characteristics. Though their model can be applied to other categories, the findings have important managerial implications: Managerial focus on temporal reference prices could lead to an everyday high price, whereas focus on contextual reference prices could lead to an everyday low price. Only the inclusion of both contextual and temporal reference prices justifies variable pricing.
A model of grocery shopper response to price and other point-of-purchase information was developed and hypotheses were tested by using observations and interviews. The findings suggest that shoppers tended to spend only a short time making their selection and many did not check the price of the item they selected. Perhaps as a consequence, more than half could not correctly name the price of the item just placed in the shopping cart and more than half of the shoppers who purchased an item that was on special were unaware that the price was reduced. Other results on point-of-purchase information processing and behavior are discussed.
The authors develop, calibrate, and test a disaggregate model of customer brand choice with customers’ price expectations as the mediating construct. They use a two-stage modeling procedure. The first stage is the determination of how expected prices are formed. In the second stage, brand choice is assumed to depend on the brand's retail price and whether or not that price compares favorably with the brand's expected price. The authors also test the hypothesis of symmetry in customer response to positive deviations (“losses”) and negative deviations (“gains”) of the retail price from the expected price. Analysis of scanner-panel data in the coffee market reveals that the brand choice model in which customers are assumed to respond to retail prices by comparing them with the corresponding expected prices provides a significantly better fit than a traditional brand choice model. Consistent with prospect theory, customers are found to react more strongly to price losses than to price gains. Results from the calibration of the expected price model indicate that expected price is not only dependent on past prices, but is also affected by the frequency with which a brand is promoted, economic conditions, customer characteristics, and the type of store shopped.
The abstract for this document is available on CSA Illumina.To view the Abstract, click the Abstract button above the document title.
More and more firms and other organizations have come to the realization that one of their most valuable assets is the brand names associated with their products or services. In an increasingly complex world, individuals and businesses are faced with more and more choices, but seemingly have less and less time to make those choices. The ability of a strong brand to simplify consumer decision-making, reduce risk, and set expecta-tions is thus invaluable. Creating strong brands that deliver on that promise and main-taining and enhancing the strength of those brands over time is thus a management im-perative.
The effectiveness of a sales promotion can be examined by decomposing the sales "bump" during the promotion period into sales increase due to brand switching, purchase time acceleration, and stockpiling. The author proposes a method for such a decomposition whereby brand sales are considered the result of consumer decisions about when, what, and how much to buy. The impact of marketing variables on these three consumer decisions is captured by an Erlang-2 interpurchase time model, a multinomial logit model of brand choice, and a cumulative logit model of purchase quantity. The models are estimated with IRI scanner panel data for regular ground coffee. The results indicate that more than 84% of the sales increase due to promotion comes from brand switching (a very small part of which may be switching between different sizes of the same brand). Purchase acceleration in time accounts for less than 14% of the sales increase, whereas stockpiling due to promotion is a negligible phenomenon accounting for less than 2% of the sales increase.
Several models of consumer response to promotions suggest that a current decision on brand and purchase quantity depends on the expected time until the next price reduction and the expected size of future reductions. In spite of the importance of expected deal frequency and expected deal price to a consumer's decision, relatively little empirical work has been reported on those topics. The authors investigate several aspects of consumer perceptions of deal frequency and deal prices. First, a conceptual model is presented to describe how consumers develop and use those perceptions. Second, results of an extensive survey are used to estimate the degree of consumer knowledge about deal frequency and deal prices. Third, hypotheses about which types of consumers have better knowledge of promotions are tested. Results from the survey indicate that many consumers are reasonably accurate about deal frequency and sale price. In addition, recall on deal frequency and sale price is higher for consumers with larger family sizes and those who read weekly fliers for items on sale, devote a higher percentage of product class purchases to the brand, and purchase the package size more frequently. It is lower for older buyers.
In a replicated in-store factorial experiment with 12 national brands in six non-perishable consumer goods categories, the authors find price deal elasticities in the [2-11] range, with larger values for smaller brands. Those elasticities increase 20% to 180% when deals are advertised by the retailer; the rates of increase are smaller for the leading brands. The price deal cross-elasticities of the higher priced brands are found to be smaller than those of the other brands; they are in the [2-2.7] range. Optimal retail deal rates are shown to be robust to model specification.
Research has shown that brands with higher deal frequency obtain a smaller market share gain on deal and have a lower expected price. However, the level of dealing must be perceived by consumers before it can affect consumer response to promotions. Hence, perception of deal frequency may affect consumer price perceptions and deal response much more strongly than the actual deal frequency. The author determines how consumer perceptions of deal frequency for a brand may be influenced by the dealing pattern of that brand and of other brands. She shows that the price consumers are willing to pay for a brand is correlated more highly with perceived deal frequency than with actual deal frequency. She also shows that the price consumers are willing to pay is correlated with the actual deal frequency of the brand for certain dealing patterns, but not for others.
In the context of three laboratory experiments ranging from a computer simulation of purchases to actual product use by subjects, the authors investigate how in-store price promotions affect market share after the promotions have been retracted. They find that the effects of promotion are contingent on both the choice patterns of subjects-whether or not subjects switch among brands-and the ubiquity of promotions in a product category. If only one brand is being promoted and subjects are generally loyal to the last brand purchased, brand choice probability declines from prepromotion levels once the promotion is withdrawn. However, if subjects tend to switch among brands in the absence of promotions, or if several brands are being promoted, this decline is mitigated and/or does not occur.
The purpose of this paper is to examine the dynamic effects of sales promotions. We create dynamic brand sales models (for weekly store-level scanner data) by relating store intercepts and a brand's own price elasticity to a measure of the cumulated previous price discounts – amount and time – for that brand as well as for other brands. The brand's own non-price promotional response parameters are related to the time since the most recent promotion for that brand as well as for other brands. We demonstrate that these dynamic econometric models provide greater managerial relevance than static models can.
This research infers deal-proneness using a condition-act choice model estimated at the household level from panel data. Two dimensions of deal-proneness emerge: active and passive. Active deal-proneness is defined as sensitivity to features and coupons; “active” refers to the relatively intensive search required to locate these types of promotions. Passive deal-proneness is defined as sensitivity to in-store displays, which refers to search that may be limited to the store environment. We develop and test hypotheses regarding the distribution of the two types of deal-proneness in our population, as well as correlational hypotheses on the association between a consumer's deal-proneness and purchase behavior. Purchase behaviors of interest include brand choice set size, purchase quantity, and purchase timing. Hypothesis testing reveals several associations. The number of brands purchased only on deal, for example, increases with increases in a consumer's feature sensitivity but is unrelated to display sensitivity.
A model of grocery shopper response to price and other point-of-purchase information was developed and hypotheses were tested by using observations and interviews. The findings suggest that shoppers tended to spend only a short time making their selection and many did not check the price of the item they selected. Perhaps as a consequence, more than half could not correctly name the price of the item just placed in the shopping cart and more than half of the shoppers who purchased an item that was on special were unaware that the price was reduced. Other results on point-of-purchase information processing and behavior are discussed.
Reference price research suggests that consumers memorize and recall price information when selecting brands for frequently purchased products. Previous price-knowledge surveys, however, indicate that memory for prices is lower than expected. In this study, we show that these priceknowledge surveys actually provided imperfect estimates of price knowledge because they focused only on recall and short-term memory. We propose, instead, to use a combination of price recall, price recognition, and deal recognition to measure the degree to which consumers use auditory verbal, visual Arabic, or analogue magnitude representations to memorize prices. We show how the combination of these three measures provides a much richer understanding of consumer’s knowledge of prices. Our results suggest that the price knowledge involved in reference prices may often not be accessible to recall but shows up in price recognition and deal recognition. In addition we identify consumer and product characteristics that explain the variations in price knowledge. We find, for instance, that frequent promotions increase the ability of consumers to remember regular prices and that store switchers do not possess a better price knowledge than other shoppers. Consumers have a strong interest in keeping a knowledge base of prices for products they
When consumers are exposed to pricing and promotional activity by frequently purchased packaged goods, they may develop expectations that are used as points of reference in evaluating future activity. The authors build a model to test for the presence of these reference effects on brand choice behavior. The approach differs from previous research in two ways: (1) the model includes reference effects of promotion in addition to reference effects of price and (2) a threshold model is introduced to capture the formation of the consumer's promotional reference point. The authors calibrate a model of brand choice using IRI scanner panel data on ground coffee. The findings suggest that promotional activity has significant reference effects on consumer response.
The effects of promotion type (i.e., price discounts and bonus packs) and price presentation (i.e., dollars and percentages) across promotional benefit levels were investigated in three experimental studies. The results suggest, for the products considered, that price discounts and bonus packs were valued similarly for both low and moderate promotional benefit levels, while price discounts were preferred when high promotional benefit levels were employed. Additionally, promotions presented in percentage terms were preferred when the benefit level was high. The implications of these results for retailers and manufacturers are that percentage price presentations should be used when large discounts are being offered. Furthermore, it appears that bonus packs are a viable alternative to price discounts when promotion levels are small or moderate since they have less of a deleterious effect on the brand.
This article focuses on consumer perceptions of transaction value when presented with deals that are equivalent on a unit-cost basis but worded differently. Through an experimental design setting, it examines the effect of three such frames: one, stated in terms of a straight price promotion (“50% off”), the second, as an extra-product or volume promotion (“buy one, get one free”), and a third as a “mixed” promotion (“buy two, get 50% off”). Four typical supermarket categories are considered which permit the investigation of the effect of two category-based moderating factors: stock-up characteristic and price level. Results show that the nature of framing appears to differentially affect consumer perceptions of value from “equivalent” deals. Also, perceptions of deal value from price versus extra-product promotions are moderated by the stock-up characteristic of the category. However, consumers' internal reference prices remain unaffected across one-time price and extra-product promotions. These findings provide some understanding of the role of deal framing on consumers' responses, and offer implications for industry practitioners interested in communicating the maximum value in their deals. © 2000 John Wiley & Sons, Inc.