How Time Restrictions Work: The Roles of Urgency, Anticipated Regret, and Deal Evaluations (original) (raw)
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Journal of Consumer Behaviour, 2019
How do consumers who miss extremely attractive sales promotions respond to merely attractive opportunities they later encounter when prices return to higher levels? The literature on inaction inertia suggests that the more attractive the missed opportunity, the less likely a consumer is to accept the subsequently encountered inferior opportunity, indicating that consumers may stay undecided. Thus, consumers are believed to be negatively influenced by the shadow of the attractive opportunities they missed. This has adverse consequences for both consumer and firm welfare. Yet, we sometimes do see consumers buying even after missing a sale. We draw from the literature on regret and personal responsibility to hypothesize the conditions that would allow the consumer to remain uninfluenced by the attractiveness of the missed opportunity. In three studies, we find support for the idea that personal responsibility for missing the first opportunity allows consumers to be less influenced by its attractiveness when they see a second inferior opportunity compared to conditions in which they were not personally responsible for missing the first opportunity; this bodes well both for consumer and marketer welfare. 1 | INTRODUCTION Marketers employ sales promotions, a type of consumer promotion, to stimulate immediate or increased purchases within a limited timeframe. Use of sales promotions is ubiquitous in consumer markets (Palazon & Delgado-Ballester, 2009b) with spending on sales promotions estimated at approximately 9% of marketing spend in 2016 (Cadent Consulting Group, 2017). Sales promotions influence consumer response through provision of economic incentives, provision of belief-changing information, and/or arousal of feelings or emotions (Raghubir, Inman, & Grande, 2004). Although price discounts are the most commonly employed form of sales promotion (Darke & Chung, 2005; DelVecchio, Krishnan, & Smith, 2007; Palazon & Delgado-Ballester, 2009b), many forms of consumer sales promotion exist. 1 While sales promotions are common practice in business, their long-term effects on business profit and customer base remain unclear (Raghubir et al., 2004). In particular, despite their efficacy in generating short-term revenue gains (Gedenk, Neslin, & Ailawadi, 2010), some research has documented undesirable consequences of sales promotions. For instance, sales promotions can lower percep
The expected benefit as determinant of deal-prone consumers' response to sales promotions
Journal of Retailing and Consumer Services, 2011
This study proposes that the responses of more and less deal-prone consumers to price discounts and premiums depend on the promotional benefit level. At low and moderate benefit levels, low deal-prone consumers show a higher evaluation for price discounts than for premiums but if the benefit is high, deal proneness does not bias the higher evaluation of price discounts. An experimental study shows that low deal-prone consumers are concerned with obtaining price discounts. Taken together, these findings suggest that consumers more concerned with obtaining promotions do not always prefer price discounts.
The Effects of Time Constraints on Consumers’ Judgments of Prices and Products
Journal of Consumer Research, 2003
This article examines how time constraints influence consumers' product evaluations over different levels of price information. To understand the effects of time constraints (time pressure), a conceptual framework incorporating both the motivational and the resource effects of time constraints on consumers' information processing is developed. Using price as the attribute information to be evaluated, specific hypotheses about the effects of time constraints on the relationship between price and consumers' perceptions of quality and monetary sacrifice are proposed. The results of a replicated experiment show that perceptions of quality and monetary sacrifice exhibit different response patterns depending on the time constraints, price levels, and subjects' motivations to process information. Additional analyses provide insights into how these two perceptions are integrated to form perceptions of value.
A study of time limited price promotions
Journal of Product & …, 2007
Purpose -This paper seeks to provide a detailed study of the impact of offers incorporating a time-limit restriction on consumers in the context of price promotions. Time limited offers are those where a pricing offer is only available for a specified, normally relatively short, period of time. Although price promotions have been the subject of much previous research, a detailed study of the effects of time limit restrictions on consumer behavior is warranted. Design/methodology/approach -The study incorporates an experimental approach whereby the impact of time-limited and non time-limited offers on consumers' assessments of value and search and purchase intentions are isolated. Findings -Findings show that the presence of a time limit does not impact directly on perceptions of value or search and purchase behavior. A marginally significant interaction effect between time limit and discount size is present, impacting in particular on search behavior.
Consumers often make decisions about outcomes and events that occur over time. This research examines consumers' sensitivity to the prospective duration relevant to their decisions and the implications of such sensitivity for intertemporal trade-offs, especially the degree of present bias (i.e., hyperbolic discounting). The authors show that participants' subjective perceptions of prospective duration are not sufficiently sensitive to changes in objective duration and are nonlinear and concave in objective time, consistent with psychophysical principles. More important, this lack of sensitivity can explain hyperbolic discounting. The results replicate standard hyperbolic discounting effects with respect to objective time but show a relatively constant rate of discounting with respect to subjective time perceptions. The results are replicated between subjects (Experiment 1) and within subjects (Experiments 2), with multiple time horizons and multiple descriptors, and with different measurement orders. Furthermore, the authors show that when duration is primed, subjective time perception is altered (Experiment 4) and hyperbolic discounting is reduced (Experiment 3). Many consumer decisions involve trading off costs and benefits over time. For example, during an online purchase, consumers frequently trade off delivery time and the costs of expedited delivery. Consumers also may decide between a smaller instant refund and a larger one that requires a longer wait. Both examples require consideration of prospective duration (e.g., the length of delivery time, the refund waiting period). Thus, examining consumers' sensitivity to prospective duration and its implication for their decisions is critical. Research on intertemporal decisions has shown that people are heavily biased toward the present (e.g., O'Donoghue and Rabin 1999; Thaler 1981; Zauberman 2003). An important and robust finding is that the rate at which an outcome is discounted over time (delay discounting) decreases as the time horizon gets longer. This is known as hyperbolic discounting, or "present bias." For example, when evaluating a lottery, people required 30ratherthan30 rather than 30ratherthan15 to wait for 3 months (a discount rate of 277%); however, the same people required only 60towaitfor1year(adiscountrateof13960 to wait for 1 year (a discount rate of 139%) and 60towaitfor1year(adiscountrateof139100 to wait for 3 years (a discount rate of 63%; Thaler 1981). Such intertemporal preferences have been attributed to impulsivity (Ainslie 1975; Loewenstein 1996), to differences in cognitive representations between near and future events (Malkoc and Zauberman 2006; Trope and Liberman 2003; Zauberman and Lynch 2005), and to individual differences in time orientation (Carstensen, Isaacowitz, and Charles 1999; Zimbardo and Boyd 1999). However, all these research streams attribute hyperbolic discounting to changes in the perception or valuation of outcomes at different times. In this article, we offer an alternative perspec
Do Coupon Expiration Dates Affect Consumer Behavior?
Journal of Marketing Research, 1994
Expiration dates are used by couponers to limit their financial liability temporally. Traditional wisdom assumes that coupon redemptions are greatest in the period immediately following the coupon drop and decline monotonically. Using regret theory, the authors predict that expiration dates induce a second mode in the redemption pattern just prior to the expiration date. They test this prediction by extending an existing coupon redemption model to incorporate an expiration effect and then estimating both the existing and the expiration models using weekly coupon redemption data for spaghetti sauce from A.C. Nielsen panels in two cities. Results are consistent with their prediction. Implications for practitioners and researchers are discussed.
Under Pressure: An Integrative Perspective of Time Pressure Impact on Consumer Decision-Making
Journal of International Consumer Marketing, 2016
Time pressure (TP) constrains consumers' decisions: stores have fixed opening hours, promotions have deadlines, and a house to rent may not be available tomorrow. Evidence about the impact of TP on decision-making suggests that when facing complex decisions consumers: do not process all the information, ground decisions upon a restricted set of attributes, defer