Preprint

Beyond the Here and Now: A Conversation-Theoretical Approach to Price Communication

Authors:
Preprints and early-stage research may not have been peer reviewed yet.
To read the file of this research, you can request a copy directly from the authors.

Abstract

This paper presents a novel conceptualization of the most common techniques firms use to communicate prices. First, we classify existing price communication techniques based on the type of action taken by firms. We then develop a framework to understand the influence of the different techniques in our classification on the ongoing relationship between firms and their customers—a perspective that extends the more transactional, one-shot view dominant in the literature. Specifically, we take a language philosophy approach and use conversation theory to formulate predictions regarding the impact of a given price communication technique on the quality of the relationship. Our conceptualization allows scholars, professionals, and policy makers to contrast and judge the different techniques on a common basis. Finally, we offer directions for future research and implications for marketing practice.

No file available

Request Full-text Paper PDF

To read the file of this research,
you can request a copy directly from the authors.

ResearchGate has not been able to resolve any citations for this publication.
Full-text available
Chapter
Full-text available
Article
This research examines how the implicit egotism resulting from consumers' positive self-associations affects their evaluations of product prices. The effects can occur when the product's price and the consumer share either name-letters (name-letter/price effect) or birthday-numbers (birthday-number/price effect).Through a series of studies, the authors demonstrate that the positive affect linked to name-letters and birthday-numbers transfers directly to consumers' price predilections and ultimately affects their purchase intentions. More specifically, consumers like prices (e.g., "fifty-five dollars") that contain digits beginning with the same first letter (e.g., "F") as their own name (e.g., "Fred," "Mr. Frank") more than prices that do not. Similarly, prices that contain cents digits (e.g., $49.15) that correspond to a consumer's date of birth (e.g., April 15) also enhance pricing liking and purchase intentions. Across groups of consumers, the authors' findings demonstrate that implicit egotism effects can result in greater purchase intentions for a higher-priced product compared with a lower-priced product.
Full-text available
Article
Experimental methods have a relatively low penetration into market research practice, despite their many inherent strengths. We review the strengths and weaknesses of four major experimental and quasi-experimental designs for market research applications. We then describe three case studies of the use of experimental logic in field-based research studies. Two examine the impact of customer profitability measurement on customer management strategies; the third studies the effect on customer satisfaction and other variables of introducing desk-based account managers into a field sales organisation. We argue for increased take-up of such experimental and quasi-experimental methods if the market research community is to tackle the twin challenges of multiple sources of data and the need to evaluate what happens within the firm as well as within its resellers and retailers and customers.
Full-text available
Article
Retailers are increasingly using round prices, a trend at odds with the marketing belief in the superiority of just-below prices. However, conclusive empirical evidence on the effectiveness of different price endings is still missing. Addressing this void, this paper presents four field-experimental studies with a broad array of samples revealing the central role of convenience in the context of price endings. Findings indicate that consumers perceive round prices as more convenient because their high cognitive accessibility saves time and effort during transactions, which is corroborated using a reaction time measure. Accordingly, round prices increase sales in purchase situations characterized by a high importance of convenience. Further, consumers’ convenience consciousness explains preferences for different price endings. This research thus contributes to the behavioral pricing literature by challenging traditional marketing beliefs and providing convincing evidence of the superiority of round prices in a complex world where many customers attach great importance to convenience.
Full-text available
Article
The use of advertised reference price promotions, such as “regularly $119.99, sale price $39.99,” is ubiquitous in the marketplace. Thirty years of research supports the conclusion that advertised reference prices (e.g., $119.99) exert an influence on consumers’ responses to offer prices (e.g., $39.99) via their assimilative influence on consumers’ internal reference prices. The present research provides an enriched account of this assimilation process. Specifically, three studies show that increasing the overlap in information made accessible by the advertised reference price and information made accessible by the offer price increases the influence of the information primed by the advertised reference price on the construction of the internal reference price. Consequently, the offer price is considered more attractive. The identification of this process provides insight into additional variables that moderate the influence of advertised reference prices on downstream deal evaluations. Implications for theory, practice, and public policy are discussed.
Full-text available
Article
Full-text available
Article
The location in which a product is presented can influence consumers' numerical estimates of product attributes (e.g., price). This effect can be driven by two alternative processes. First, people may have acquired a learned association between numerical magnitude and location as a consequence of frequently viewing larger numbers to the right of smaller ones. In addition, they may have learned a procedure of reading or writing numbers from left to right in increasing order of magnitude. The authors present six experiments that demonstrate the effect of location on numerical estimates and provide evidence that both number–location associations and number–order associations could drive this effect.
Full-text available
Article
Existing theory and prior research suggest that consumers perceive purchase prices more/less favorably when they are preceded by higher/lower prices. However, to date, researchers have found these effects in contexts in which the product, and thus perceived quality, is held constant. Given that consumers commonly believe price and quality are positively correlated and that price-quality perceptions have been shown to influence price evaluations and willingness to pay, the generalizability of existing research to commonly encountered contexts is questionable. In this research, the authors examine the influence of price order on consumer choice across differing brands in contexts in which consumer quality perceptions are free to covary with price and they are manipulated to be correlated or uncorrelated with price. Using reference dependence theory as a framework, they find that when differing brand options are presented in descending price order, consumers tend to choose higher-price options; when they are presented in ascending price order, consumers tend to choose lower-priced options (the price order effect). In addition, the authors show that consumers' price-quality perceptions are a necessary condition for this effect.
Full-text available
Article
Exposing consumers to extreme prices can influence the price they are willing to pay for both related and unrelated products. Drawing on previous theories of anchoring and adjustment and selective accessibility of judgment-relevant knowledge, the authors provide an account of both asymmetries in the impact of price anchors across product categories and contingencies in the occurrence of these asymmetries. Four studies show the deliberate consideration of price anchors that can play a key role in whether the effect of the anchors will generalize across product categories. Specifically, an explicit comparison of a product to a price anchor increases the accessibility of features that represent a product available at this price. In turn, these thoughts influence the price that consumers are willing to pay for these products. In the absence of this deliberation, however, anchors influence both related and unrelated products, provided no other cognitive activity occurs in the interim.
Full-text available
Article
Numbers and prices can be processed and encoded in three different forms: 1) visual [based on their written form in Arabic numerals (e.g., 72)], 2) verbal [based on spoken word-sounds (e.g., “seventy” and “two”), and 3) analog (based on judgments of relative “size” or amount (e.g., more than 70 but less than 80)]. In this paper, we demonstrate that including commas (e.g., $1599 vs. $1599) and cents (e.g., $1599.85 vs. $1599) in a price's Arabic written form (i.e., how it is perceived visually) can change how the price is encoded and represented verbally in a consumer's memory. In turn, the verbal encoding of a written price can influence assessments of the numerical magnitude of the price. These effects occur because consumers non-consciously perceive that there is a positive relationship between syllabic length and numerical magnitude. Three experiments are presented demonstrating this important effect.
Full-text available
Article
Figurative language in advertising affects product attitudes positively across contexts. In contrast, the present research demonstrates that the use and effectiveness of figurative language in consumer-generated content is context specific, because of conversational norms unique to this form of communication. Study 1 shows that consumer reviews containing more figurative language lead to more favorable attitudes in hedonic, but not utilitarian, consumption contexts, and that conversational norms about figurative language govern this effect. Study 2 reveals that reading a review containing figurative language increases choice of hedonic over utilitarian options. Finally, via analysis of online consumer reviews and a lab experiment, studies 3 and 4 indicate that consumers use figurative language more when sharing experiences about hedonic than utilitarian consumption, and that review extremity influences figurative language use only in reviews of hedonic consumption. The studies highlight the critical role of conversational norms in interpreting and creating user-generated content.
Full-text available
Article
How exactly does the display location of a sale price relative to the original price affect consumers' evaluations? Across multiple studies, including field studies with actual choices and studies with nonstudent samples, this article shows that consumer evaluations are a function of the display location of the sale price, but such evaluations are moderated by discount depth. First, presenting the smaller number to the right (vs. left) makes it easier to initiate the subtraction task, a phenomenon the authors refer to as the “subtraction principle.” Second, given that evaluating sale prices inherently involves a subtraction task, locating sale prices to the right (vs. left) of the original price facilitates calculation of discount depth, increasing evaluations for moderate discounts but not for low discounts. These effects are potentially reversed in cases of both very low discounts and exaggerated discounts. The findings in this article offer novel and nonintuitive insights into how sale price display locations and discount depth interact to influence numerical cognitions, processing of sale prices, and subsequent evaluations.
Full-text available
Article
Previous research has explored how both internal and external references prices affect consumer perceptions and consequently the price that consumers are willing to pay for a product or service. Historically, researchers have examined the effects of exposure to prices for the same product, the same brand, or products in the same category. This research explores the effect of incidental prices on the consumer's willingness to pay. The authors define incidental prices as prices advertised, offered, or paid for unrelated products or goods that neither sellers nor buyers regard as relevant to the price of an item that they are engaged in selling or buying. More specifically, the authors examine how prices for products that buyers encounter unintentionally can serve as anchors, thus affecting willingness to pay for the product that they intend to buy. The findings have important implications for auction houses and online vendors as well as for conventional retailers.
Full-text available
Article
The effects of interpersonal reward and violations of conversational distancing expectations on compliance and interaction behaviors were tested in three retail shopping settings. Subjects were salespeople (N = 70, N = 49, N = 104) who were approached by confederates posing as customers or students conducting interviews on consumer behavior. Two levels of interpersonal reward (high versus low levels of apparent status, attractiveness, purchasing power and/or expertise) and three levels of distance (close violation, norm, far violation) were manipulated. Results showed high reward to induce more compliance with a request and more favorable interaction patterns than low reward. Distance violations evoked more arousal, activation and apparent distraction, while the favorability of reactions to distance violations tended to vary by reward level, as expected. Confounding effects of gender, confederate communication style, and possible nonverbal norms for compensation and reciprocity are also discussed.
Full-text available
Article
Consumers sometimes encounter a combination of comparative and noncomparative prices in the marketplace. For example, a grocer may employ signage that provides favorable price comparisons with those of a competitor for a portion of its products, a practice that the authors refer to as "partially comparative pricing." The authors examine the effects of partially comparative pricing on consumer response and find that it has both desirable and undesirable effects. On the one hand, such pricing enhances consumers' beliefs about the relative prices of comparatively priced products and about the retailer's relative prices in general. On the other hand, such pricing also reduces consumers' relative price beliefs about noncomparatively priced products and their intentions to purchase such products. The authors further show that the adverse influence of partially comparative pricing stems from consumers' suspicions about why price comparisons exist for some, but not all, products. They also document how these effects depend on store patronage. They discuss implications of their research and provide suggestions for future empirical efforts.
Full-text available
Article
Firms often use a pricing strategy in which the total price of a product and/or service is partitioned into two or more mandatory components. Whereas previous research has compared partitioned with non-partitioned pricing, this article examines how partitioning the total price differently across the components affects consumer preferences. In four studies, the authors show that consumers' reactions to price partitioning are moderated by the perceived consumption benefit of the components. Specifically, consumers are more sensitive to the price of components that provide low consumption benefits than to the price of components that provide relatively high consumption benefits. Consequently, when evaluating different partitions of the same total price, consumers prefer partitions in which the price of the low-benefit component is lower and the price of the high-benefit component is higher.
Full-text available
Article
Following Becker (1957) we ask whether competition will eliminate the effects of behavioral biases. We study the case of shrouded product attributes, such as main- tenance costs, expensive add-ons, and hidden fees. In standard competitive models with costless advertising all firms choose to reveal all product information. We show that information revelation breaks down when some naive consumers do not anticipate shrouded attributes. Firms will not compete by publicly undercutting their competi- tors' add-on prices if (i) add-ons have close substitutes that are only exploited by sophisticated consumers, or (ii) many consumers drop out of the market altogether when the add-on market is made salient. We show that informational shrouding flour- ishes even in highly competitive markets, even in markets with costless advertising and
Article
In this study, we highlight the need and develop a framework for customer engagement (CE) by reviewing the marketing literature and analyzing popular press articles. By understanding the evolution of customer management, we develop the theory of engagement, arguing that when a relationship is satisfying and has emotional connectedness, the partners become engaged in their concern for each other. As a result, the components of customer engagement include both the direct and the indirect contributions of CE. Based on the theoretical support, our proposed framework elaborates on the components of CE as well as the antecedents (satisfaction and emotion) and consequences (tangible and intangible outcomes) of CE. We also discuss how convenience, nature of the firm (B2B vs. B2C), type of industry (service vs. product), value of the brand (high vs. low), and level of involvement (high vs. low) moderate the link between satisfaction and direct contribution, and between emotions and indirect contribution of CE, respectively. Further, we show how customer engagement can be gained and how firm performance can be maximized by discussing relevant strategies.
Article
Marketing theory and practice have focused persistently on exchange between buyers and sellers. Unfortunately, most of the research and too many of the marketing strategies treat buyer-seller exchanges as discrete events, not as ongoing relationships. The authors describe a framework for developing buyer-seller relationships that affords a vantage point for formulating marketing strategy and for stimulating new research directions.
Article
Many firms divide a product's price into two mandatory parts, such as the base price of a mail-order shirt and the surcharge for shipping and handling, rather than charging a combined, all-inclusive price. The authors call this strategy partitioned pricing. Although firms presumably use partitioned pricing to increase demand and profits, there is little clear empirical support that these prices increase demand or any theoretical explanation for why this should occur. The authors test hypotheses of how consumers process partitioned prices and how partitioned pricing affects consumers’ processing and recall of total costs and their purchase intentions and certain types of demand. The results suggest that partitioned prices decrease consumers’ recalled total costs and increase their demand. The manner in which the surcharge is presented and consumers’ affect for the brand name also influence how they react to partitioned prices.
Article
The authors analyze the issue of comparative price advertising from a behavioral perspective. Because public policy recognizes that comparative pricing may lead to consumer misperceptions, the authors review the regulatory setting and pose several research questions that need to be addressed. A complex experiment and replication examining some of these questions is reported.
Article
Reference prices, which are extensively used in retail advertisements, have received considerable research attention over the last 15 years. The authors examine how reference prices in advertisements affect consumers’ price beliefs and behavioral intentions in different contexts. A model of reference price effects is proposed and tested. The model facilitates explanation of anomalous findings in previous research.
Article
Relationship marketing—establishing, developing, and maintaining successful relational exchanges—constitutes a major shift in marketing theory and practice. After conceptualizing relationship marketing and discussing its ten forms, the authors (1) theorize that successful relationship marketing requires relationship commitment and trust, (2) model relationship commitment and trust as key mediating variables, (3) test this key mediating variable model using data from automobile tire retailers, and (4) compare their model with a rival that does not allow relationship commitment and trust to function as mediating variables. Given the favorable test results for the key mediating variable model, suggestions for further explicating and testing it are offered.
Article
The authors expand and integrate prior price-perceived value models within the context of price comparison advertising. More specifically, the conceptual model explicates the effects of advertised selling and reference prices on buyers’ internal reference prices, perceptions of quality, acquisition value, transaction value, and purchase and search intentions. Two experimental studies test the conceptual model. The results across these two studies, both individually and combined, support the hypothesis that buyers’ internal reference prices are influenced by both advertised selling and reference prices as well as the buyers’ perception of the product's quality. The authors also find that the effect of advertised selling price on buyers’ acquisition value was mediated by their perceptions of transaction value. In addition, the effects of perceived transaction value on buyers’ behavioral intentions were mediated by their acquisition value perceptions. The authors suggest directions for further research and implications for managers.
Article
This research shows that making a precise (vs. round) offer in a negotiation may lead to diverging outcomes. On the one hand, past literature has demonstrated a precision advantage wherein offer precision reduces the amount by which offer recipients counter. On the other hand, building on the notion that round numbers symbolize completion and previous findings that individuals tend to set goals at round numbers, we hypothesize a roundness advantage wherein offer roundness increases the bargainer's willingness to accept an offer. Five studies provide convergent evidence for our proposition and reconcile the present results with previous findings. We found that participants receiving a round offer are more (less) likely to accept (counter) than those who receive comparable precise offers. However, if they counter, participants in the precise condition counter by a smaller amount than those in the round condition. Furthermore, in agreement with our explanation, we find that the roundness advantage is more likely to manifest when participants subscribe to the association between round numbers and the feeling of completion.
Article
Purpose The purpose of this paper is to explore and discuss the concept of brand hate. The authors present a taxonomy of the main determinants and outcomes of brand hate and empirically assess our model. Design/methodology/approach A survey design using cross-sectional primary data from 224 German consumers was used. Hypotheses related to determinants and outcomes of brand hate were tested by means of structural equation modelling. Findings Findings show that brand hate is triggered by three determinants (negative past experience, symbolic incongruity, ideological incompatibility) and leads to three behavioral outcomes (brand avoidance, negative word-of mouth, brand retaliation). Originality/value This paper explores and outlines theoretically and empirically the determinants and outcomes of brand hate. It also provides a useful taxonomy of brand hate.
Article
Firms typically treat their costs as tightly-guarded secrets. In six studies, we test the effect of firm disclosure of the costs to produce a given product (i.e., cost transparency) on purchase interest. We begin with a natural field experiment conducted with an online retailer, in which cost transparency increased sales (Study 1A). We subsequently replicate this field experiment in a controlled lab setting (Study 1B), and show that cost transparency is particularly potent in boosting purchase interest above other forms of transparency (Study 2). Guided by our theoretical framework, Studies 3 and 4 show that the effect is mediated by consumers’ trust in the firm, with Study 4 showing that this mediator explains variance above and beyond perceptions of price fairness. Finally, Study 5 demonstrates the critical role of the voluntary nature of the disclosure, by showing that cost transparency boosts purchase interest only when voluntarily instated by the firm, as opposed to involuntarily (e.g., as required by law). These results imply that the proactive revelation of costs can improve a firm’s bottom line.
Chapter
This chapter discusses major brand hate antecedents in two strands: company-related antecedents and consumer-related antecedents. Company-related antecedents are discussed as “product and service failures” and “corporate social irresponsibility”. Furthermore, there is discussion of potential interactions among company-related antecedents, as some companies can both provide dysfunctional products and services and can be socially irresponsible. These potential antecedents are discussed in light of the current literature. With regard to consumer-related antecedents, there is a focus on consumer personality traits that might function as major antecedents, such as the case of narcissistic individuals. Narcissism and entitlement are interchangeable as major consumer brand hate indicators in this chapter.
Article
Understanding customer experience and the customer journey over time is critical for firms. Customers now interact with firms through myriad touch points in multiple channels and media, and customer experiences are more social in nature. These changes require firms to integrate multiple business functions, and even external partners, in creating and delivering positive customer experiences. In this article, the authors aim to develop a stronger understanding of customer experience and the customer journey in this era of increasingly complex customer behavior. To achieve this goal, they examine existing definitions and conceptualizations of customer experience as a construct and provide a historical perspective of the roots of customer experience within marketing. Next, they attempt to bring together what is currently known about customer experience, customer journeys, and customer experience management. Finally, they identify critical areas for future research on this important topic.
Article
We study theoretically and empirically the consumption of access services. We demonstrate that consumption is affected by contract structure (pay-per-use versus three-part tariffs) even if the optimal consumption plans are identical. We find that, although there is extensive individual heterogeneity, on average, consumers' choices follow a structure that is similar to a nearly optimal heuristic and correctly react to imbalances between the number of free calls and call opportunities remaining. However, consumers use the free units too quickly, leading to overconsumption and lost surplus. These errors are partially driven by mistaken beliefs about the value distribution. We also measure subjects' willingness to pay for a contract with free access units, and we find that nearly half of subjects are willing to pay at least the full per-unit price, with a substantial fraction willing to overpay. In response, the optimal firm strategy offers a three-part tariff at a very small discount, which increases revenue by 8%-14% compared to only offering a pay-per-use contract.
Article
Price transparency initiatives are typically undertaken by third parties to ensure that consumers can compare the prices of competing offers in markets in which obtaining such information is costly. Such practices have recently become widespread, yet it is unclear whether the increased price competition due to lower search costs overcomes the potential for collusion between competitors due to lower price coordination costs. Motivated by this question, the authors investigate the effect of mandatory price posting (on large electronic signs) on the pricing behavior of competing gas stations in the Italian highway system. The authors find that when prices are posted, the average price of gasoline decreases by 1 euro cent per liter, which represents about 20% of stations' margins. About half the price decrease can be attributed to the introduction of a sign posting a station's own price and those of its nearest neighbors, with the other half due to the introduction of other signs posting the prices of other stations on the same road. Despite the price reduction, however, the introduction of signs seems to have little impact on price dispersion, suggesting that price uncertainty persists even after the policy is implemented. Analysis of customer transaction data confirms this finding, showing that less than 10% of consumers use the posted price information effectively.
Article
Alliteration is the repetition of initial word sounds across two or more proximal words. Alliterative pricing presentations consisting of words (brand or product names) and numbers (price and quantity information) can influence evaluations, choice, and purchase behavior. We provide evidence that alliterative pricing promotions can positively influence deal evaluations and product choice; for example, “Two T-shirts $21” elicits more positive evaluations from consumers than does “Two T-shirts $19,” even though the latter pricing presentation is objectively better. We suggest phonological (word sound) overlap present in alliteration facilitates message processing, which in turn results in more positive judgments and deal evaluations and influences choice. Our findings build theory while presenting clear managerial implications for marketing communications and pricing decisions.
Article
Academic studies offer a generally positive portrait of the effect of customer relationship management (CRM) on firm performance, but practitioners question its value. The authors argue that a firm's strategic commitments may be an overlooked organizational factor that influences the rewards for a firm's investments in CRM. Using the context of online retailing, the authors consider the effects of two key strategic commitments of online retailers on the performance effect of CRM: their bricks-and-mortar experience and their online entry timing. They test the proposed model with a multimethod approach that uses manager ratings of firm CRM and strategic commitments and third-party customers' ratings of satisfaction from 106 online retailers. The findings indicate that firms with moderate bricks-and-mortar experience are better able to leverage CRM for superior customer satisfaction outcomes than firms with either low or high bricks-and-mortar experience. Likewise, firms with moderate online experience are better able to leverage CRM into superior customer satisfaction outcomes than firms with either low or high online experience. These findings help resolve disparate results about the value of CRM, and they establish the importance of examining CRM within the strategic context of the firm.
Article
A widespread practice in grocery store advertising is to compare the advertised store's prices to a competitor's prices on multiple items. An important, but largely unexplored, issue is how this information is processed and used in conjunction with prior beliefs to influence price perceptions. In our initial studies we manipulated prior beliefs and two data-based cues-frequency of price advantage and magnitude of price advantage-to determine their relative influence on consumer price perceptions. Results indicate that prior beliefs affected price perceptions but that the frequency cue exerted a dominating influence. Several follow-up studies demonstrate the robustness of this phenomenon across a variety of presentational and instructional conditions.
Article
This research proposes that because rounded numbers are more fluently processed, rounded prices (e.g., $200.00) encourage reliance on feelings. In contrast, because nonrounded numbers are disfluently processed, nonrounded prices (e.g., $198.76) encourage reliance on cognition. Thus, rounded (nonrounded) prices lead to a subjective experience of “feeling right” when the purchase decision is driven by feelings (cognition). Further, this sense of feeling right resulting from the fit between the roundedness of the price number and the nature of decision context can make positive reactions toward the target product more positive and negative reactions more negative, a phenomenon referred to as the rounded price effect in the current research. Results from five studies provide converging evidence for the rounded price effect. Findings from the current research further show that merely priming participants with rounded (nonrounded) numbers in an unrelated context could also lead to the rounded price effect. Finally, this research provides process support by showing that the rounded price effect is mediated by a sense of feeling right. This is the first research examining the differential impact of roundedness of prices on product purchase decisions, based on whether the purchase decision is driven by feelings versus cognition.
Article
Customer relationship management (CRM) is perceived to be failing, and there is an urgent need for some practical ways to address this issue. The research presented in this article demonstrates that the implementation of CRM activities delivers greater profits. Using calculations of the lifetime value of customers in two longitudinal case studies, the research finds that customer management strategies change as more is discovered about the value of the customer. These changes lead to better firm performance. The contribution of this article is to show that CRM works and that a relatively straightforward analysis of the value of the customer can make a real difference.
Article
Interpersonal trust is an aspect of close relationships which has been virtually ignored in social scientific research despite its importance as perceived by intimate partners and several family theorists. This article describes the development, validation, and correlates of the Dyadic Trust Scale, a tool designed for such research. It is unidimensional, reliable, relatively free from response biases, and purposely designed to be consistent with conceptualizations of trust from various perspectives. Dyadic trust proved to be associated with love and with intimacy of self-disclosure, especially for longer married partners. It varied by level of commitment, being lowest for ex-partners and highest for those engaged and living together, for newlyweds, and for those married over 20 years. Partners reciprocated trust more than either love or depth of self-disclosure. Future research could fruitfully relate dyadic trust to such issues as personal growth in relationships, resolving interpersonal conflict, and developing close relationships subsequent to separation or divorce.
Article
The role of conversational processes in quantitative judgment is addressed. In three studies, precise numbers (e.g., $29.75) had a stronger influence on subsequent estimates than round numbers (e.g., $30), but only when they were presented by a human communicator whose contributions could be assumed to observe the Gricean maxims of cooperative conversational conduct. Numeric precision exerted no influence when the numbers were presented as the result of an automated procedure that lacks communicative intent (Study 1) or when the level of precision was pragmatically irrelevant for the estimation task (Study 2). (c) 2013 Elsevier Inc. All rights reserved.
Article
Through the cooperation of a direct-mail women's clothing retailer, we were able to conduct a well-controlled experiment testing the sales effect of using retail prices that end in the digits 99 rather than 00 (e.g., $29.99 rather than $30.00). The results indicated that the use of 99 endings led to increased consumer purchasing. This finding demonstrates the importance of the manager's decision concerning a price 's rightmost digits. © 1996 New York University. All rights of reproduction in any form reserved.
Article
Purpose ‐ The aim of this paper is to conceptualise the influences of extreme negative emotional response towards luxury brands as expressed in brand hate. Design/methodology/approach ‐ The paper uses examples obtained from a critical incidents approach to interviews with a small sample of German and British luxury consumers. Informants were asked to identify extremely positive and then extremely negative incidents which affected their perceptions of luxury brands. This critical incidents approach allowed for a clearer focus on the negative incidents and allowed identification of common themes that may be related to extreme negative affect. Findings ‐ The evaluation of negative incidents which the informants named suggest that country of origin, consumer dissatisfaction with service, and negative stereotypes of luxury brand users are potential antecedents of brand hate within the luxury sector. Some types of advertising might heighten the latter effect. Consumers' perceptions of corporate social performance did not seem to be a strong source of brand hate, yet the respondents stressed the significance of luxury brands to act responsibly. Thus, it is important for luxury brands to avoid potential dissonance in the way consumers perceive them. Research limitations/implications ‐ This primarily conceptual paper uses examples from Germany and the UK. Therefore, it is recommended to continue with studies in other countries, including emerging economies, to identify potential cross-cultural differences. Furthermore, it would be interesting to ascertain which factors are the most significant in evoking extreme negative brand affect. Practical implications ‐ The core reputation of the luxury brand is a common theme which is identified as a driving force of brand hate. Brand practitioners therefore need to consider how to build a strong positive reputation in order to withstand the immediate and long-term consequences of brand hate. Originality/value ‐ The need to investigate antecedents of extreme negative affect as manifested in brand hate reflects a gap in extant literature on luxury brand management. Therefore, the authors contend that their conceptualization of antecedents of affect will have important theoretical and practical implications within the field of luxury brand management.
Article
Customer loyalty is increasingly seen to be crucial to the success of business organisations, with the growing realisation that attracting new customers is far more expensive than retaining existing ones. It has been suggested that a way of increasing customer retention is through secure relationships between buyers and sellers. Surprisingly, however, and despite the growing body of literature on relationship marketing issues, little empirical research has been conducted on the link between relationship marketing and customer loyalty in a retailing context. This paper attempts to address this gap by presenting and testing a conceptual model of the process by which the implementation of relationship marketing can enhance such loyalty. A dyadic exploratory study of clothing store managers and their customers was conducted. Findings reveal that customers' perceptions of clothing stores' relationship marketing efforts are crucial to enhanced commitment and loyalty. Implications are drawn from these results, and future research directions are discussed.
Article
This paper examines how odd-ending pricing influences consumption of hedonic and utilitarian products. Four studies test the hypothesis that the discount image associated with odd-ending prices reduces anticipated guilt and provides justification for hedonic consumption – an effect the authors label the odd-ending price justification effect (OPJE). Study 1 reveals people are more likely to choose hedonic over utilitarian products when they have odd-ending prices. Study 2 finds that the effect of odd-ending prices on hedonic consumption is mediated by guilt reduction. Study 3 reveals a boundary condition for the OPJE – purchase likelihood of hedonic products increases only when monetary, not nonmonetary, guilt is reduced. Study 4 suggests the OPJE operates at an unconscious level, as consumers who are made aware of the trivial difference between odd- and round-ending prices are no longer influenced by odd-ending prices. The theoretical, practical, and research implications of these findings are discussed.
Article
Partitioned pricing is a widely used pricing strategy, but little is known about the buyer characteristics that influence its effectiveness. The current research contributes to the pricing literature by investigating the impact of regulatory focus on the perceived attractiveness of partitioned and combined pricing. In four studies, we hypothesized and found support for the idea that promotion focused individuals perceive partitioned prices to be more attractive than combined prices, while prevention focused individuals do not differentiate between the two pricing types. Our results also show that regulatory focus influences consumers’ information processing style, which in turn leads to important differences in attitudes towards partitioned and combined pricing. Specifically, promotion focused consumers are more likely to engage in global processing and global processing is linked to preferences for partitioned (versus combined) prices.
Article
Firms often partition a product’s price into two mandatory parts (e.g., the base price of a mail-order DVD and the surcharge for shipping and handling) instead of charging one all-inclusive price. This study examines whether and to what extent partitioned pricing (compared to one all-inclusive price) influences the informational and sacrifice effects of price. We empirically show that partitioned pricing oppositely affects these two distinct roles of price: the informational effect of price (i.e., price as an indicator of quality) increases, while the sacrifice effect (i.e., price as a measure of sacrifice) becomes more negative. In product categories with substantial price–quality inferences, the positive impact of partitioned pricing on the informational effect can overcompensate for its negative impact on the sacrifice effect, making partitioned prices the preferable strategy.
Article
Consumers selected round prices and/or sales-totals at greater than chance levels across two different pay-what-you-want situations and one self-pumped gasoline purchase. The differences among these situations suggest that the tendency to select round prices/sales-totals reflects a subjective preference (or liking) for round prices and not a variety of other potential explanatory processes. Discussion focuses on possible economic consequences of this revealed preference for round prices as well as directions for future research.
Article
Prior studies provide mixed results pertaining to the effectiveness of temporal reframing of prices. This study examines the conditions in which such temporal reframing to a shorter period of time is more or less beneficial than aggregate prices. Investigations of the role of four moderating variables—price endings, price level, time periods, and calculation affinity—show that reframed prices are more beneficial than aggregate prices for high-priced products, especially in combination with even price endings, an aggregate price that normally refers to a comparatively short time period, or customers with poor calculation affinity. Aggregate prices offer more benefits than reframed prices for low-priced products, odd price endings, aggregate prices that refer to longer periods, and customers with excellent calculation affinities.