Work

Sales framing, mental accounting, and discount assignments

Year: 2015

Type: article

Abstract: This investigation explores the effect of sales framing on the attractiveness of mixed promotions. The authors propose that the “focused-discount” promotion format (e.g., 50% off the purchase of a second item) is more attractive to consumers than the “all-discount” promotion format (e.g., 25% off the purchase of two items) due to the effect that different frames have on the mental accounting processes of consumers. In Experiments 1 and 2, participants confronted by focused-discount (vs. all-discount) promotion assigned a relatively higher discount value to the final product and perceived greater savings. In Experiment 3, priming participants to focus on the first item reduced this framing effect of mixed promotions. The results show that participants perceived greater savings in a focused-discount framing (vs. all-discount) due to the differences in how discounts were assigned for each item. Finally, this paper suggests that companies may frame promotions to increase their relative attractiveness to consumers.

Source: Asia Pacific Management Review

DOI: 10.1016/j.apmrv.2015.01.002

Authors: Hsin-Hsien Liu, Yu-Yeh Chiu

Institutions: National University of Kaohsiung, Chien Hsin University of Science and Technology

Language: English

Topic: Consumer Market Behavior and Pricing

Subfield: Marketing

Field: Business, Management and Accounting

Domain: Social Sciences

Open Access status: hybrid

Estimated APC paid: $2,000

Funder: National Science Council