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Promotional benefits of 99-ending prices: the moderating role of intuitive and analytical decision style

Charlotte Gaston-Breton

DEE - Working Papers. Business Economics. WB from Universidad Carlos III de Madrid. Departamento de Economía de la Empresa

Abstract: Evidence suggests that retailers use 99-ending prices as a promotional technique. This paper explores the consumer perceived benefits of such promotional practices and the information processing conditions under which hedonic benefits are higher (lower) than utilitarian ones. In line with the benefit framework of sales promotion proposed by Chandon, Wansink, and Laurent (2000), 99-ends are not expected to be strictly associated to monetary savings benefit but also to a more hedonic benefit, fulfilling consumer’s needs for exploration. In addition, the analytic or intuitive consumer decision style (Mantel & Kardes, 1999) is likely to activate either the utilitarian benefit of savings or the hedonic benefit of exploration with more strength. The analysis of an on-line survey among 317 shoppers shows that both perceived savings and exploration benefits have a positive impact on proneness to buy 99-ends products with the saving benefits being stronger (weaker) for analytical decision makers (intuitive decision makers). The findings contribute to the better understanding of the image effect of 99-ends underlying its individual differences and help retailers and also pricing managers in their use of 99-ends as a promotional technique.

Keywords: 99-ending; prices; Image; effect; Perceived; benefits; Decision; style (search for similar items in EconPapers)
Date: 2011-12
New Economics Papers: this item is included in nep-hme
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