 The role payment depreciation in short temporal separations: Should online retailer make customers wait?Dheeraj Sharma and Shivendra Pandey Journal of Retailing and Consumer Services, 2020, vol. 53, issue C Abstract: In recent times, it has become common for customers to pre-pay for goods but consume them later. The pain of payment reduces over time, in a phenomenon called payment depreciation (PD). Researchers have examined this phenomenon in situations when payment precedes consumption by long periods, ranging from three weeks to several years. The present study examines the occurrence of payment depreciation when costs precede benefits by short periods, such as three days to two weeks. The three experiments establish the presence of PD in short intervals of less than two weeks. The results are robust for both inventoried and non-inventoried consumption. The results further suggest that the sunk cost of a payment devalues discretely and not continuously. The value of the sunk cost in the consumer's mental account drops significantly after two weeks, as compared to one week. The results fail to demonstrate the effect of payment mode on the payment depreciation phenomenon. Implications indicate that retailers can vary their order delivery period to reduce product returns. Keywords: Payment depreciation; Benefit; Cost; Short periods; Sunk cost (search for similar items in EconPapers) Downloads: (external link) Related works: Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text Persistent link: https://EconPapers.repec.org/RePEc:eee:joreco:v:53:y:2020:i:c:s0969698919304473 DOI: 10.1016/j.jretconser.2019.101965 Access Statistics for this article Journal of Retailing and Consumer Services is currently edited by Harry Timmermans More articles in Journal of Retailing and Consumer Services from Elsevier |
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