Perceived Price Fairness in Pay-What-You-Want: A Multi-Country Study

Bettray, Julius; Suessmair, Augustin; Dorn, Tim

doi:10.4236/ajibm.2017.75051

Cited by 6 publications

(6 citation statements)

References 61 publications

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“…In this regard, the present work provides evidence of how some contextual factors in the implementation of PWYW may affect consumers' behavior and hence the experience's profitability. A case‐study approach is relevant to the topic because the scarce works on PWYW from a cross‐country approach have found significant differences between countries (see Bettray et al ., 2017; Dorn and Suessmair, 2017). Therefore, the article contributes to the literature on PWYW and non‐conventional pricing strategies by clarifying the role of different motivations in consumers' economic decisions, and by identifying contextual factors that trigger or inhibit non‐selfish behavior.…”

Section: Introductionmentioning

confidence: 99%

Empathic cultural consumers: Pay what you want in the theater

Tena-Sánchez

León-Medina

Noguera

2020

Journal of Consumer Affairs

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Pay what you want (PWYW) is an increasingly popular sales strategy in which consumers voluntarily decide how much to pay for a product or service. PWYW has often been described as an exercise in the "empathy economy," where consumers' payment choices might be seen as empowered expressions of their tastes and preferences, and sellers have a stronger incentive for empathizing with them. Beyond their economic interest, PWYW experiences also deserve significant attention in the social sciences given that they challenge several key assumptions of rational choice and neoclassical economic theory, as well as conventional consumer behavior and pricing theories. This paper analyzes three plays performed at the Beckett Theater in Barcelona using PWYW with very profitable outcomes. Our analysis shows that socio-psychological factors, such as payments attributed to others and satisfaction with the play, are the best predictors of customer payments.

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Section: Introductionmentioning

confidence: 99%

Empathic cultural consumers: Pay what you want in the theater

Tena-Sánchez

León-Medina

Noguera

2020

Journal of Consumer Affairs

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“…Using experimental data from UK respondents, Vulkan and Shem-Tov (2015) examined this issue and suggested a specific price design to enhance the perception of fairness in the context of personalized pricing: consumers should be asked to pay a fixed percentage (and more specifically, 64%) of their willingness to pay. Many researchers, including Bettray et al (2017) and Richards et al (2016), have found that participative pricing mechanism (paywhat-you-want)consistent with intuitionyielded higher level of fairness sense than ordinary price setting.…”

Section: Loss Aversion Is Stronger In Consumer Durablesmentioning

confidence: 86%

“…This effect is accentuated in online pricing where price comparisons are instantaneous and easy. Further, researchers (Bettray et al, 2017;Richards et al, 2016) have also found that participative pricing mechanism (pay-what-you-want) produced a higher level of fairness and satisfaction. Early research has demonstrated "Fair Pay" pricing architecture and found that the architecture enhances the power of both the buyer and seller [3].…”

Section: Directions For Future Researchmentioning

confidence: 99%

Behavioral response to online pricing: empirical and managerial insights

Kalyanaram

Saini

Mony³

et al. 2022

JIBR

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Purpose Pricing is always a fundamental marketing element. In the digital marketing/e-commerce context, there are two universal phenomena: desire to micro-segment and customize, and the adverse reaction upon unfair perception of price. A third related question is how should firms consider price increases and decreases? Specifically, this paper aims to address the following three research and practice questions: What are the theoretical underpinnings of perception of fairness/unfairness in pricing, and what are the findings? What are the theoretical underpinnings of response to price increases and decreases? What should be online pricing strategy, consistent with the findings on (un)fairness perception of pricing and response to price increases and decreases? Design/methodology/approach The present approach is integrative review and critical analyses, and synthesis. The review dates back to 1960s, and is inter-disciplinary, including apposite findings in behavioral science, economics, marketing and operations management/research. The authors search for insights with significant empirical support to address these questions. Findings Perception of unfair price impacts consumer choice, probability of purchase, intent to buy and attitude to product/service/firm adversely. Consumers react differently to perceived unfair and fair prices. Consumers react more strongly and negatively to perceived unfair prices (compared to prices perceived to be fair) in their intent to buy and other related metrics. Consumers react differently to price increases and price decreases relative to the reference price. Consumers react more strongly to price increases than to price decreases. There is substantial heterogeneity in the magnitude of loss-aversion effect, depending on the product/service category and estimation methods. Originality/value The authors review and discuss potential viable pricing strategies. Based on the generalizable findings, this study provides actionable insights to managers for pricing in digital marketing context. Also, the authors provide useful directions for future research.

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“…Until recently, in the hospitality industry, its application has been quite limited in scope [41,78]. But, nowadays, a combination of factors, including the decline of traditional travel agencies and the rise of online ones, the availability of cheap information and communication technologies and dedicated software have induced many hotels to introduce these practices [15,4,1,7].…”

Section: Introductionmentioning

confidence: 99%