Buy four get 30% off: how consumers respond to missing a quantity discount

Abstract

2015),"Buy four get 30% off: how consumers respond to missing a quantity discount", European Journal of Marketing, Vol. 49 Iss 7/8 pp. -Permanent link to this document: http://dx.If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services.Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation.

How consumers respond to missing a quantity discount with multiple price breaks

“…This revised internal reference price is used as a reference against which they evaluate the actual offering of the product, which in turn alters purchase probability. Our results are consistent with previous findings in reference price research that consumers do not perceive retailer‐supplied reference prices in isolation; perceptions of retailer‐supplied reference prices also depend on the context in which perception occurs (Monroe, ; Lichtenstein et al , ; Rondan‐Cataluña and Martin‐Ruiz, ; Yoon and Vargas, ; Kan et al , ; Huang and Yang, ).…”

“…A fictitious e‐shop was used in order to control for the possible confounding effect of website reputation. Online apparel shopping was selected for several reasons (Huang and Yang, ): (i) quantity discounts are a commonly used promotional strategy among clothing retailers, and a single‐unit price and multiple‐unit price are easily comparable by consumers. More importantly, the policy of the retailer is to not allow the consumers to obtain the discount when less than the designated amount is purchased; (ii) the probability of not meeting the minimum purchase requirement and thus failing to obtain the quantity discount is high in this industry, because the styles, colors, or sizes of interest to the consumers are often out of stock; (iii) undergraduate students are real‐life consumers who purchase their own clothes at such online stores; (iv) it is easier to control the experimental setting (e.g., stock situation) in an e‐shop than it would be in a brick and mortar shop.…”

“…For example, participants in the three‐price break and large interval condition were asked to imagine the following scenario. This role‐playing approach has been successfully used in a number of quantity discount studies (e.g., Manning and Sprott, ; Yoon and Vargas, ; Huang and Yang, ).…”

“…After reading the scenario, participants were asked to indicate the likelihood that they would buy the undiscounted shirt on a 7‐point scale ranging from 1 = very unlikely to 7 = very likely (Huang and Yang, ). Next, to collect information on the participant's internal reference price, an open‐ended question was used: “What price do you think is reasonable for this shirt?…”

“…There is much evidence showing that consumer evaluations of price offers are heavily influenced by the decision context and situational cues (Aggarwal and Vaidyanathan, ; Rondan‐Cataluña and Martin‐Ruiz, ; Yoon and Vargas, ; Huang and Yang, ). This suggests that the form in which the quantity discount is expressed may change the consumers' price estimates and subsequent consumption decisions.…”