Retail price discount depth and perceived quality uncertainty

Dan Zheng, Yuxin Chen, Zhe Zhang and Hai Che

Journal of Retailing, 2022, vol. 98, issue 3, 542-557

Abstract: This study analyzes the impact of retail price discount depth on consumer perception of quality uncertainty and its implications. While the extant research finds a negative relationship between perceived mean quality (indicated by the mean of quality perception) and price discount, we suggest an inverted-U-shaped relationship between perceived quality uncertainty (indicated by the variance of quality perception) and price discount. The underlying mechanism for this phenomenon is that consumer attribution of price promotion varies by discount depth. Specifically, when provided with a moderate discount (compared with a low or high discount), consumers cannot ascertain whether the discount is related to product quality; thus, they perceive a higher level of quality uncertainty and correspondingly rely more on other cues, such as country of origin and product popularity information, to make inferences about quality. Those findings have implications for setting the depth of retail price discounts and providing product quality-related information in the context of price promotion.

Keywords: Retail price discount depth; Perceived quality uncertainty; Perceived mean quality; Quality cue; Attribution (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (3)

Downloads: (external link)
http://www.sciencedirect.com/science/article/pii/S0022435921000786
Full text for ScienceDirect subscribers only

Related works:
This item may be available elsewhere in EconPapers: Search for items with the same title.

Export reference: BibTeX RIS (EndNote, ProCite, RefMan) HTML/Text

Persistent link: https://EconPapers.repec.org/RePEc:eee:jouret:v:98:y:2022:i:3:p:542-557

DOI: 10.1016/j.jretai.2021.12.001

Access Statistics for this article

Journal of Retailing is currently edited by A. Roggeveen

More articles in Journal of Retailing from Elsevier
Bibliographic data for series maintained by Catherine Liu ().