Book now, pay later: the effects of delays in payments and temporal distance on consumers’ perceptions and purchase intention

Yisak Jang (), Li Miao () and Chih-Chien Chen ()
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Yisak Jang: University of New Orleans
Li Miao: University of Macau
Chih-Chien Chen: University of Nevada, Las Vegas

Journal of Revenue and Pricing Management, 2023, vol. 22, issue 5, No 5, 374-384

Abstract: Abstract In today’s hotel industry, ‘book now, pay later’ practice is widespread. However, despite the prevalence of this phenomenon, the psychological and behavioral influences of ‘book now, pay later’ transactions on consumers have received almost no research attention. Using an experimental design, this research examined how deferred payments influence consumers’ perceived price, perceived risks, and purchase intention according to the time of booking in the leisure travel context. The results demonstrated that people perceived less risks and had a greater purchase intention when a hotel offered the ‘pay later’ option compared to the ‘pay now’ option. However, individuals planning a trip in the near future did not show any significant differences in perceived risks and purchase intention between the options of ‘pay later’ and ‘pay now’.

Keywords: Deferred payments; Temporal distance; Perceived risks; Revenue management; Book now; pay later (search for similar items in EconPapers)
Date: 2023
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DOI: 10.1057/s41272-022-00416-4

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