The effects of promotion framing on consumers' price perceptions

Abstract

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. AbstractPurpose -The use of price-based promotions is common in the service industry due to their positive impact on sales in the short run. To gain a better understanding of the effectiveness of various types of promotions, the current research aims to examine the contrasting effect of two popular framing methods (i.e. percentage-off versus dollars-off) on consumers' perceived savings and willingness to buy. More importantly, this research examines the moderating effect of personal sense of power on such relationships. Design/methodology/approach -The study used 2 £ 2 between subjects quasi-experimental design to test the hypotheses. Respondents were asked to read a scenario regarding booking a hotel room and then complete scales that measured their perceptions of savings and willingness to book. Findings -Results indicate that personal sense of power moderates the effects of the promotion frame on perceived savings and willingness to book. Individuals with a low sense of power perceive significantly more savings and exhibit significantly higher booking intentions when the promotion is framed in dollars-off rather than in percentage-off format. The framing manipulation, however, had minimal effects among high power individuals. In addition, the authors find that confidence in estimating the promoted price is the psychological mechanism that potentially explains the casual link from power to perceived savings and willingness to book. Originality/value -Drawing on the social psychology theory, the current study discovered some boundary conditions for the framing effect in the context of pricing of services. In addition, the current research advances the theoretical understanding of power's psychological and behavioural effects in the context of price promotions.

Impact of different price discount frames and levels on customer perception and behavioural intention

“…Hotel Royal Passeig de Gracia is currently offering a special promotion. Please, review the scenario and answer questions below" (Choi & Mattila, 2014).…”

“…According to some studies, sales promotion can either increase or decrease the perceived quality. The results depend on the characteristics of sales promotion and promoted products (Choi & Mattila, 2014). Some studies (Parsons et al, 2014) show that low prices tend to make customers suspicious of the quality of the promoted product or service.…”

Consumer responses to savings message framing

“…Furthermore, building on past work comparing dollar-off promotions and percentage-off deals ( Choi & Mattila, 2014 ; Suri et al, 2013 ), we introduce an important boundary condition (i.e., savings presentation format). Specifically, we predict when the amount of savings is presented in percentage terms, the superiority of gain-framed messages (i.e., “get % off”) over nonloss-framed messages (i.e., “save %”) will disappear.…”

The Effect of Non-Monetary Framing Sales Promotion on Customer’s Purchase Intention with Believability of the Deal Offer As Mediation Variables

“…The reason for researchers to use these three types of promotion because each non-monetary promotion difference in previous research was in a form of extra content, extra product and premium with equivalent values have not been used at once and identify their effect on purchase intention. If in the previous study the framing effect comparison of the promotion was applied to low priced product and high priced product [19][20][21][22][23], then different forms of promotion are applied in this research plan to high priced products with famous brand names, because brand names affect consumers when evaluating a promotion [24,25]. Previously Swani and Yoo [26] have identified the impact of discount promotion (price deals) on purchasing intentions, applied to well-known brands with high equity brands such as Prada handbags and sunglasses, but they do not identify the framing effect of the price deals (comparing discounted and undiscounted brands).…”