Hidden price promotions: Could retailer price promotions backfire?

Hidden-price promotions, a type of uncertain price promotion in which the final price is not revealed when consumers first encounter the product, have been recently adopted by retailers. However, current research suggests that hidden-price promotions have the potential to backfire and result in reduced consumer purchase intention. Across seven studies, we reveal that hidden-price promotions can be effective but risk increasing discount expectations, as consumers expect a large discount. Only when the discount level meets or exceeds inflated expectations does the excitement built by the promotion positively impact purchase intention. For cognitive purchases, even without providing a high discount, hidden-price promotions are as effective as traditional ones. This research provides guidelines for retailers that want to employ hidden-price promotions.     

Presenting comparative price promotions vertically or horizontally: Does it matter?

This research examines whether spatial differences in presentation of comparative price promotions (vertical vs. horizontal) affect consumers' assessment of price discounts. Results show that when comparative price promotions are presented horizontally, consumers take longer to compute the monetary discount and are less accurate than when such prices are presented vertically. This suggests that cognitive constraints exhibit a larger detrimental effect on performing computations when prices are presented horizontally than vertically. In addition, a constraint on visual resources impacts vertical presentations more while a constraint on verbal resources influences price computations that are presented horizontally.     

Effect of consumer animosity on boycott campaigns in a cross-cultural context: Does consumer affinity matter?

Global companies have often suffered from unexpected boycott campaigns in foreign markets owing to consumer animosity toward a country of origin. This study aims to empirically investigate how consumer animosity (toward economic sanctions) and affinity predict consumer boycotts. We conduct a country comparison, employing the PROCESS macro to test the moderated mediation hypothesis, using data from 571 and 500 consumers in South Korea and Japan, respectively. The results find a negative indirect effect of animosity on purchase amount via boycott attitude and intention in both countries. The direct impact of animosity on purchase amount (in the case of South Korea) and the moderated mediation effect of consumer affinity (in the case of Japan) are partially supported. Therefore, the offsetting influence of consumer affinity in mitigating the effects of consumer animosity in the context of boycott campaigns is highlighted, offering novel managerial implications.     

Domestic versus foreign listing: Does a CEO's educational experience matter?

Where to list an initial public offering (IPO) is a critical decision for an entrepreneurial firm. Our study investigates IPO location choice between home country and foreign country by examining a sample consisting of the entire population of 1479 Chinese private issuers during the period from 2005 to 2014. We enrich upper echelons theory by bringing in the insights of imprinting theory. Our results indicate that the sources of imprint − prestigious domestic education and foreign education − influence CEOs' preference for an IPO location. More specifically, CEOs with prestigious domestic degrees tend to list their firms in China whereas CEOs with foreign degrees tend to list outside China. Given that the imprinting effects of education have a lasting influence on CEOs, despite subsequent environmental changes, long tenures allow such effects to be imparted to other top management team members. Another finding is that when the CEOs are also the founders, there are two separate imprinting effects.     

Does good governance matter for FDI inflows? Evidence from Asian economies

This paper examines the effects of the six components of good governance on foreign direct investment (FDI) inflows in 15 Asian economies for the period 1996–2007 using a fixed effect model for panel data with heteroskedasticity corrected standard errors. The study also employs the feasible general least square (FGLS) and Prais-Winstein panel estimation methods in order to check the consistency of the results with the fixed effect model. The empirical results reveal that of the six components of good governance, political stability and absence of violence, government effectiveness, rule of law, and control of corruption are the key determinants of FDI inflows, as they exhibit consistent results under different models. However, the study finds no significant evidence with voice and accountability and regulatory quality in FDI inflows. The study reveals that human capital, infrastructure, lending rate, and GDP growth rate also have a significant influence on FDI inflows. We conclude that a country which can enhance its governance environment in general is likely to attract more foreign direct investment despite offsetting deficiencies in other dimensions of good governance such as voice and accountability and regulatory quality.     

Logistic service quality and technology: a comparison between supplier–retailer and retailer–consumer relationships

Physical distribution quality can be considered as a differentiation factor and, in this way, as a source of competitive advantage. Nevertheless, there is neither consensus about its dimensions, or on how it might be influenced by technological solutions. The present paper aims at identifying the main antecedents of logistic service quality, examining the influence of technology on logistic service quality and analysing its effects on firm results in terms of customer satisfaction and loyalty in different levels of the marketing channel. The proposed structural equations model is tested empirically in two different samples: 400 consumers and 304 distributors. For both samples, technology assessment shows a positive effect on logistic service quality and this, in turn, generates customer satisfaction and loyalty.     

Red price? Red flag! Eye-tracking reveals how one red price can hurt a retailer

Retailers present prices in red color to signal savings. Past research has shown that presenting all prices in red increases perceived savings from the store. However, in practice, retailers often present just one price in red in promotion materials with multiple prices. Will consumers perceive higher savings from the store even if only one price is presented in red? This research examines this prevalent retail practice using a theoretical lens. The theoretical framework predicts that two unique learned associations with red color (red: Savings and red: Stop) play a key role in shaping consumers' perception of savings from stores that highlight only one price in red. This research proposes and empirically demonstrates that consumers perceive lower savings from stores that present only one price in red. The theoretical framework is validated using a multi-method approach that combines the strengths of behavioral and physiological (eye-tracking) methods. Findings from this research suggest that presenting only one price in red lowers perceived savings from the store, which may hurt sales.     

Sex-based price discrimination: Does it violate civil-rights laws?

“Ladies-night” beverage discounts not offered to male customers may violate state laws governing places of public accomodation.     

Effects of outdoor advertising: Does location matter?

The growth and success of outdoor advertising is in large part due to the medium's ability to reach an increasingly elusive and mobile consumer. However, this success has come with a price. Public pressure and regulation have begun to eliminate or curtail many outdoor advertising locations, leading practitioners to question the effectiveness of the remaining outdoor advertising sites. Using associative learning techniques, these studies investigate what effect, if any, the environment in which outdoor advertising appears has on the attitudes, beliefs, and purchase intent of the advertised brand. The results of four experiments presented here suggest that the background environment does not impact advertising effectiveness, and practitioner concern of such may be unfounded. © 2011 Wiley Periodicals, Inc.     

Are privacy concerns still relevant? Revisiting consumer behaviour in omnichannel retailing

Omnichannel retailing is a new retail norm that focuses on providing a seamless interaction between retailers and consumers. Although the effect of omnichannel retailing on business is increasingly recognised, privacy concerns remain a subject of debate and a delicate issue which could potentially inhibit its growth. Grounded in the Stimulus–Organism–Response (S–O–R) model, the current study investigates consumer behaviour in omnichannel retailing and uses Psychological Reactance Theory (PRT) as the theoretical basis to examine the moderating effect of privacy concerns. A quantitative approach was adopted by means of self-administered questionnaires. 736 consumers were sampled, and the data were analysed using Partial Least Squares Structural Equation Modelling (PLS-SEM). The findings show that consumer perception of channel integration (CPCI), consumer empowerment (CE), and trust significantly affect patronage intention in omnichannel retailing. In addition, when privacy concerns are low, the effects of CPCI and CE on trust are found to be stronger. It underscores the need to synergize channel integration, retailer-consumer relationship empowerment and effective mitigation of privacy concerns in the omnichannel retailing context. Implications of the study are provided.     

Company support for employee volunteerism: Does size matter?

This article examines the relationship between company size and support for employee volunteering. Based on organizational ecology and organizational stages theory, the study hypothesizes that larger versus smaller companies demonstrate greater formalization and codification of their support for employee volunteering. Similarly, larger versus smaller companies use employee volunteering efforts more strategically; this finding is consistent with a need to justify decisions. These outcomes in turn impact the nature of volunteering and the organizations benefiting from such programs. Survey data from a size-stratified sample of 990 randomly selected Canadian businesses indicates that large companies support employee volunteerism in a more formalized and strategic manner than small companies. This behavior includes having formal policies and programs, as well as exercising greater influence over the causes which benefit from employee volunteering. Additionally, large companies are more likely to tie other forms of charitable support to employee volunteering. The article discusses how the more formalized approach of large companies may impact society.     

Does mismeasurement explain low productivity growth?

The “mismeasurement hypothesis” holds that the recent slowdown in recorded productivity growth merely reflects a fall-off in our ability to measure productivity rather than an actual deceleration in economic growth, in large part reflecting benefits people gain, but don’t pay for, from using new technology applications. If this hypothesis is valid, we should see that national drops in productivity growth are connected to usage of these services, we should be able to ascertain large gains in surplus related to them, growth in the technology sector should be sharply understated, and labor incomes should be swelling relative to output. None of these arenas show evidence that recent miscounts of aggregate productivity are notably large compared to the past.     

Consumer multihoming predisposition on food platforms: Does gender matter?

Although food platforms are witnessing greater competition and shrinking margins in emerging markets, consumer multihoming remains an underexplored phenomenon. Previous studies highlight the inverse relationship between consumers' commitment to service providers and their multihoming behaviour. Also, behavioural studies confirm the relationship between consumers' commitment and gender. In this vein, we ask a fundamental question: whether gender is associated with user multihoming predisposition? Based on the questionnaire survey of 493 food platform users and the Kruskal–Wallis H (K–W–H) analysis used, we establish a direct association between gender and multihoming. The probit analysis suggests higher multihoming promiscuousness among male consumers than among female consumers. Moreover, we conclude that the frequency of platform usage positively affects multihoming behaviour among female consumers, while education affects multihoming in males. The study thus builds upon existing food platform literature and provides an epistemological connection between gender and multihoming. Further, it outlines strategies that platform firms can use to restrain their clientele from multihoming.     

Channels for search and purchase: Does mobile Internet matter?

Recent industry reports indicate that consumers own four digital devices on an average, and switching devices during shopping is the “new normal.” The addition of mobile Internet as a new channel of search and purchase has spurred the adoption of the digital medium, and easy accessibility of the Internet on multiple devices is influencing shopping patterns. A consumer may prefer some channels for search and others for purchase or use a combination of channels to search and purchase simultaneously. As a new channel, it is unclear 1) whether mobile Internet offers greater search or purchase benefits and 2) what type of products are more suitable for mobile Internet search and purchase. In this study, we develop a framework that describes the factors that drive the use of mobile Internet in a multi-channel environment. We test the framework using survey data from a sample of U.S consumers. The main findings from our study indicate that 1) the choice of channel combinations that include mobile relative to other channel combinations increases with an increase in perceived search convenience of mobile channel. 2) in the digital channel, mobile and desktop differ in their utility along search dimensions. The probability of choosing channel combinations that include mobile increases due to search convenience whereas desktop is attractive due to perceived gains of price comparison search; and 3) mobile Internet search increases for consumers searching for utilitarian products. The insights from this study deepen our understanding of how digital media is used in the search-purchase process and have important managerial implications.     

University choice: which attributes matter when you are paying the full price?

This article presents the results from a longitudinal study of students' choice of university in England. Students were surveyed initially when applying for university (Wave One) and then again when they were about to embark on their chosen course (Wave Two). The results from Wave Two demonstrated a high degree of consistency with the Wave One findings: course and university reputation are far more important and fees are relatively unimportant. However, a key result across both waves was that patterns of utility for students with no parental experience of university were significantly different from students whose parents had attended university. The utility associated with different levels of entry qualifications, of fees and of university and course reputation, differed between social groups. The study suggests that the benefits of going to a highly rated university may be undervalued in families that have no direct experience of higher education. In addition, whilst females are more significantly put off by universities with low entry requirements, the qualitative attitudinal statements included in the follow‐up study seem to indicate that so‐called ‘softer’ factors may also influence their choice.     

Does perception matter?: an empirical analysis of donor behaviour

This article provides the first empirically based marketing model of the perceptions of givers and the resulting impact on donations. Within nonprofit marketing there is a considerable amount of extant research to support the view that both extrinsic and intrinsic variables can be used to separate givers and non-givers to charities. However, they are less useful in explaining how individuals select between the charitable alternatives and in understanding how people determine and apportion support. Perceptual factors offer more utility in this regard. Structural equations models are presented based on a survey of over 2,300 active and lapsed donors that link a series of perceptual determinants to four relevant charity performance measures: the total amount given to charity, the number of gifts given, the giving lifetime between the individual and the charity, and the amount given yearly. Marketing management implications are identified.     

Higher quality or lower price? How value-increasing promotions affect retailer reputation via perceived value

Marketers often attempt to increase consumers' perceptions of value by raising the quality or reducing the price of products. Five studies demonstrate that consumers are generally more sensitive to lower-price promotions than to higher-quality promotions as they form their perceptions of retailer reputation (Study 1), that the perceived value mediates this effect (Study 2), that store image (prestigious vs. thrifty) moderates the effect (Study 3), and that perceived price level (Study 4) and quality level (Study 5) independently drive the moderating effect of store image.     

Does retailer CSR enhance behavioral loyalty? A case for benefit segmentation

We study the effects of consumer perceptions of four types of corporate social responsibility (CSR) activities on their behavioral loyalty toward retailers. The four activities are environmental friendliness, community support, selling locally produced products, and treating employees fairly. Behavioral loyalty is measured by share-of-wallet (SOW). We control for other retailer attributes that drive attitudes and SOW, and examine how the market is segmented in terms of consumer response. We partition the total effect of CSR on SOW into a direct effect and an indirect effect mediated through attitude towards the store. These effects differ by CSR activity and customer segment. The effects on attitude are positive and positive attitude enhances SOW, so the indirect effects on SOW are positive. While we generally find positive total effects, the total effect of one of the CSR activities, environmental friendliness, is significantly negative for one group of consumers. The magnitude of CSR's total impact on SOW is not only statistically significant but also managerially meaningful in an industry where every share point carries a substantial dollar amount. We characterize the customer segments and conclude with implications for how best a retailer can manage its CSR initiatives.     

Does investor recognition matter for asset pricing?

In a world of market imperfections, what matters for asset prices differs from theory predictions based on perfect markets and information. In this paper, using a market setting where information costs are more pronounced, I show that the level of investor recognition/awareness matters for asset prices as predicted by Merton (1987). Using a novel dataset, I study the price effects of inclusions to and exclusions from a benchmark equity index in the context of emerging market assets. While testing for a number of existing hypotheses, I am able to document evidence for the ‘investor recognition’ hypothesis, using event study methodology. Furthermore, by making use of analysts' recommendations data, I show that there is a significant increase in coverage for the included stocks. This is also significantly related to the observed price change.