Consumer preference for pay-per-use service tariffs: the roles of mental accounting

Sejeong Yun () and Kwanho Suk ()
Additional contact information
Sejeong Yun: Yonsei University Mirae Campus
Kwanho Suk: Korea University

Journal of the Academy of Marketing Science, 2022, vol. 50, issue 5, No 11, 1124 pages

Abstract: Abstract When consumers purchase service plans, they often fail to choose the lowest cost alternative because of their general tendency to avoid pay-per-use pricing. The present research examines the role of psychological process in consumer’ preference for price plans, focusing on the reasons for lower preference for pay-per-use plans. In addition, this research proposes a novel method to increase the preference for pay-per-use pricing by simply reframing it as a price plan with an initial allowance and gains and losses from the allowance. The results of seven studies demonstrate that the reframed pay-per-use plan is preferred to the regular pay-per-use plan, although the actual costs are the same. The increased preference for the reframed pay-per-use is caused by the change in the salient reference point that influences the perceived gain and loss of the price plan.

Keywords: Pricing; Pay-per-use; Framing; Reference point; Mental accounting (search for similar items in EconPapers)
Date: 2022
References: View references in EconPapers View complete reference list from CitEc
Citations: View citations in EconPapers (2)

Downloads: (external link)
http://link.springer.com/10.1007/s11747-022-00853-y Abstract (text/html)
Access to the full text of the articles in this series is restricted.

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:spr:joamsc:v:50:y:2022:i:5:d:10.1007_s11747-022-00853-y

Ordering information: This journal article can be ordered from
https://www.springer ... gement/journal/11747

DOI: 10.1007/s11747-022-00853-y

Access Statistics for this article

Journal of the Academy of Marketing Science is currently edited by John Hulland, Anne Hoekman and Mark Houston

More articles in Journal of the Academy of Marketing Science from Springer
Bibliographic data for series maintained by Sonal Shukla () and Springer Nature Abstracting and Indexing ().