Contextual and Temporal Components of Reference Price

Rajendran, K. N.; Tellis, Gerard J.

doi:10.2307/1252248

Cited by 260 publications

(84 citation statements)

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“…They built a model from earlier models to show connections between quality, cost, perceived cost, and perceived esteem. They utilized Rajendran and Tellis (1994)'s idea of reference value, which included promoting signals on purchasers' inside reference cost and (Zeithaml, 1988)'s idea of perceived quality, which was operationalized as customer's reference cost. Ehrenberg, Goodhardt, and Barwise (1990) tended to the twofold peril issue by clarifying the arithmetic of the twofold danger burdens that low piece of the overall industry brands had on deals, both in numbers and utilization per buy among their clients.…”

Section: Review Of the Literaturementioning

confidence: 99%

Impact of Brand Equity Drivers on Purchase Intention: A Moderating Effect of Entrepreneurial Marketing

Raza¹,

Frooghi²,

Rani³

et al. 2018

SAJMS

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Abstract:The study aimed to analyse the impact of brand image, brand perception, brand preference and brand loyalty on consumer purchase intention in the FMCG industry of Pakistan. It also used entrepreneurial marketing as moderator between the association of brand loyalty, brand perception, brand image and brand preference with purchase intention. The study has used quantitative explanatory research design. In this concern, a sample of 424 responses was collected using convenience sampling technique from different self-service stores and mega malls of Karachi city, Pakistan. Survey instrument was adapted from numerous past literatures and designed on fivepoint Likert measurement scale. The results and findings of the study showed that brand loyalty, brand perception and brand preference have statistically significant and positive impact on purchase intention. Among the three statistically significant variables, brand loyalty has most impact on purchase intention, followed by brand preference and least influenced by brand perception. Additionally, the results showed that entrepreneurial marketing moderates the relationship of brand loyalty, brand perception and brand preference with purchase intentions of consumer toward FMCG brands in Pakistan. However, the results interestingly showed that brand image does not influence purchase intention and also, entrepreneurial marketing does not moderate its relationship with purchase intention in regards to FMCG brands in Pakistan. The study also showed that combination of all the variables has strength to predict 34.1 percent of purchase intention in regards to FMCG brands of Pakistan. The study further provides conclusion, managerial recommendations and future research directions.

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Section: Review Of the Literaturementioning

confidence: 99%

Impact of Brand Equity Drivers on Purchase Intention: A Moderating Effect of Entrepreneurial Marketing

Raza¹,

Frooghi²,

Rani³

et al. 2018

SAJMS

View full text Add to dashboard Cite

show abstract

“…Kalwani et al (1990) summarize the impact of the previous five prices and find the most recent price to be weighted most heavily. Rajendran and Tellis (1994) use the weighted mean of the previous three prices with the most recent price weighted most heavily as a brandspecific temporal reference price.…”

Section: Analysis Of the Misspecified Modelmentioning

confidence: 99%

The Impact of Heterogeneity in Purchase Timing and Price Responsiveness on Estimates of Sticker Shock Effects

Chang¹,

Siddarth

Weinberg

1999

Marketing Science

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The notion that individuals have an internal reference price against which they compare observed prices is well supported by several psychological theories. Empirically, several papers in the marketing literature, employing scanner panel data, have modeled the impact of reference prices on brand choice via the sticker shock formulation, in which consumers evaluate choice alternatives using differences between shelf prices and reference prices. Most of the studies reported thus far have not accounted for heterogeneity in price response among consumers and have typically imputed reference prices from the shelf prices of brands that a consumer is supposed to have "observed" on previous purchases in the category. Since category marketing activity can differentially affect the purchase timing of households, we argue that this measure of reference price may follow certain systematic patterns across consumers and, when combined with unaccounted for price response heterogeneity, may result in a spurious sticker shock effect. Specifically, we show that estimates of sticker shock are biased upward if households that are price-sensitive in the brand choice decision are also more responsive to category promotion activity in their purchase timing decision.We discuss some general conditions under which the bias occurs and conduct a simulation experiment to confirm our specific hypotheses. Our simulation results show that changes in purchase timing are a critical determinant of the bias in the sticker shock effect. We also show that unaccounted for price response heterogeneity can in itself result in a biased sticker shock parameter; however, this requires very large differences in price sensitivities across consumers, far greater than what is normally observed.We develop a hierarchical Bayes version of the nested logit model, which models heterogeneity via individual-level parameters in a continuous random effects framework. We estimate the model on scanner panel data from the yogurt and ketchup categories. We find, in both categories, that the 95% probability interval of the posterior distribution of the mean sticker shock coefficient contains the value zero. Therefore, at least for the data used in this study, there is no evidence for the sticker shock effect at the aggregate level. In contrast, the corresponding coefficient from a standard model (which ignores this heterogeneity) is highly significant and supports the existence of a (possibly spurious) sticker shock effect. Consistent with our explanation of the underlying cause of the bias, households that are more price-sensitive in the choice decision are also found to be more responsive to category promotion activity in their decision to purchase in the category.The results highlight the measurement problems associated with imputing reference prices from past prices. Since the frequency, duration, and price level of a retailer's promotional program depend on its size and prevalence, accurate estimates of the sticker shock effect are essential for formulating op...

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“…Reference prices are individual price norms that are applied when judging a price observed in the market (Winer, 1988). Such references may have a predictive and normative function (Rajendran & Tellis, 1994). The application of reference price theory has focused on the explanation of consumer brand choice and on the opportunity to guide consumer price perceptions during and after their purchases.…”

Section: References In Price Researchmentioning

confidence: 99%

A neural network approach to predicting price negotiation outcomes in business-to-business contexts

Moosmayer

Chong

Liu

et al. 2013

Expert Systems with Applications

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Contextual and Temporal Components of Reference Price

Cited by 260 publications

References 0 publications

Impact of Brand Equity Drivers on Purchase Intention: A Moderating Effect of Entrepreneurial Marketing

Impact of Brand Equity Drivers on Purchase Intention: A Moderating Effect of Entrepreneurial Marketing

The Impact of Heterogeneity in Purchase Timing and Price Responsiveness on Estimates of Sticker Shock Effects

A neural network approach to predicting price negotiation outcomes in business-to-business contexts

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