Impact of promotions on shopper price comparisons

Velitchka D. Kaltcheva, Robert D. Winsor, Anthony Patino and Stewart Shapiro

Journal of Business Research, 2013, vol. 66, issue 7, 809-815

Abstract: Retailers implementing the Hi–Lo or promotional-pricing strategy frequently offer temporary price promotions to attract customers to the store. For this strategy to be financially successful, however, the store must entice bargain seekers to purchase non-discounted merchandise. Because regular prices at Hi–Lo retailers, as a rule, substantially exceed those of EDLP competitors, customers engaging in price comparisons across stores may perceive that a Hi–Lo retailer's regular (non-discounted) prices are excessive relative to competitors' prices and therefore will be less likely to make purchases at the regular Hi price. Given the potentially harmful effects of across-store price comparisons for Hi–Lo retailers, this exploratory research examines whether some forms of price promotion may be relatively more effective at discouraging consumers from comparing a retailer's non-discounted prices to those at competing stores.

Keywords: Promotions; Price comparisons; Consumers; EDLP; Hi-Lo pricing (search for similar items in EconPapers)
Date: 2013
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (5)

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Persistent link: https://EconPapers.repec.org/RePEc:eee:jbrese:v:66:y:2013:i:7:p:809-815

DOI: 10.1016/j.jbusres.2011.06.005

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