Price promotions, beneficiary framing, and mental accounting

Geoffrey Fisher (), Matthew McGranaghan (), Jura Liaukonyte () and Kenneth C. Wilbur ()
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Geoffrey Fisher: Cornell SC Johnson College of Business, Cornell University
Matthew McGranaghan: Lerner College of Business and Economics at the University of Delaware
Jura Liaukonyte: Cornell SC Johnson College of Business, Cornell University
Kenneth C. Wilbur: University of California

Quantitative Marketing and Economics (QME), 2023, vol. 21, issue 2, No 1, 147-181

Abstract: Abstract We introduce the idea of beneficiary framing to the promotion response literature. Two large-scale field experiments (total N = 73,010) in the context of print-at-home coupons show that framing a savings message as affecting a beneficiary (i.e., “save for X”) increases coupon printing and redemptions. This beneficiary framing effect is equivalent to an incremental $0.05 (3.4%) of coupon value. We report eight additional studies (total N = 3,052) to investigate the mechanism, replicability, and role of salience. We find evidence supporting a mental accounting explanation: participants with beneficiary-related budget categories rate beneficiary-framed coupons as more account-relevant and more valuable than non-beneficiary-framed coupons. The experiments further suggest that the beneficiary framing effect (i) holds across multiple common budgeting domains, (ii) cannot be fully explained by an affect transfer mechanism, (iii) is not solely attributable to the visual salience of the beneficiary framing treatment, and (iv) exhibits a boundary condition in which beneficiary framing may reduce promotion response when the recipient does not have a relevant beneficiary. Overall, the results suggest a low-cost approach that some marketers can use to increase promotion uptake.

Keywords: Price promotions; Coupons; Beneficiary framing; Field experiments; Mental accounting (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1007/s11129-023-09261-0

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