Using Experimental Survey Designs to Support Pricing Decisions

Andreas Kramer

Business and Management Horizons, 2016, vol. 4, issue 1, 22-38

Abstract: Due to a changing marketing environment (more volatile, uncertain, complex and ambiguous framework, digitization) and the lack of a consistent pricing approach (challenge to harmonize neoclassical and behavioral elements), managers are increasingly questioning established ways to determine price levels and display price structures. Experimental testing represents a possibility to provide a decision support to pricing managers in the short run. The article presents three different projects, which quantitatively examine key elements of behavioral pricing: (1) the ¡°Center-stage Effect¡± (electricity contract), (2) the impact of context on price perception (promotional campaigns for train tickets) and (3) offering of price guarantees as a means for improving the overall image as well as customer loyalty of the supplier (gas station). The results are partly unexpected as they contradict often-cited rules of thumb in behavioral pricing. Hence, it can be shown that experimental testing based on online surveys is a valuable and cost-efficient method to optimize price structures, price levels as well as price communication.

Keywords: VUCA; Price strategy; Behavioral pricing; Experimental testing; Online survey (search for similar items in EconPapers)
Date: 2016
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