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Strengthening the Influence of Advertised Reference Prices through Information Priming

Author

Listed:
  • Christina Kan
  • Donald R. Lichtenstein
  • Susan Jung Grant
  • Chris Janiszewski

Abstract

The use of advertised reference price promotions, such as "regularly $119.99, sale price $39.99," is ubiquitous in the marketplace. Thirty years of research supports the conclusion that advertised reference prices (e.g., $119.99) exert an influence on consumers' responses to offer prices (e.g., $39.99) via their assimilative influence on consumers' internal reference prices. The present research provides an enriched account of this assimilation process. Specifically, three studies show that increasing the overlap in information made accessible by the advertised reference price and information made accessible by the offer price increases the influence of the information primed by the advertised reference price on the construction of the internal reference price. Consequently, the offer price is considered more attractive. The identification of this process provides insight into additional variables that moderate the influence of advertised reference prices on downstream deal evaluations. Implications for theory, practice, and public policy are discussed.

Suggested Citation

  • Christina Kan & Donald R. Lichtenstein & Susan Jung Grant & Chris Janiszewski, 2014. "Strengthening the Influence of Advertised Reference Prices through Information Priming," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 40(6), pages 1078-1096.
    • Handle: RePEc:oup:jconrs:doi:10.1086/674059
    DOI: 10.1086/674059
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    Cited by:

    1. Daniel F. Garrett, 2019. "Fake Sales: A Dynamic Pricing Perspective," The Japanese Economic Review, Springer, vol. 70(3), pages 375-382, September.
    2. Mao, Zhixin & Duan, Yongrui & Liu, Wenxia, 2023. "Consumers’ choice of private label considering reference price and moderating effect," Journal of Retailing and Consumer Services, Elsevier, vol. 71(C).
    3. Carlson, Jay P. & Paul, Iman, 2022. "Pick a card: Price ranges and gift card choice," Journal of Retailing and Consumer Services, Elsevier, vol. 65(C).
    4. Bhukya, Ramulu & Paul, Justin, 2023. "Social influence research in consumer behavior: What we learned and what we need to learn? – A hybrid systematic literature review," Journal of Business Research, Elsevier, vol. 162(C).
    5. Flöter, Thomas & Benkenstein, Martin & Uhrich, Sebastian, 2016. "Communicating CSR-linked sponsorship: Examining the influence of three different types of message sources," Sport Management Review, Elsevier, vol. 19(2), pages 146-156.
    6. Hung, Hui-Hsi & Cheng, Yin-Hui & Chuang, Shih-Chieh & Yu, Annie Pei-I & Lin, Yu-Ting, 2021. "Consistent price endings increase consumers perceptions of cheapness," Journal of Retailing and Consumer Services, Elsevier, vol. 61(C).
    7. Sungsik Park & Man Xie & Jinhong Xie, 2023. "Frontiers: Framing Price Increase as Discount: A New Manipulation of Reference Price," Marketing Science, INFORMS, vol. 42(1), pages 37-47, January.
    8. Ketron, Seth & Spears, Nancy & Dai, Bo, 2016. "Overcoming information overload in retail environments: Imagination and sales promotion in a wine context," Journal of Retailing and Consumer Services, Elsevier, vol. 33(C), pages 23-32.
    9. Nicole Koschate-Fischer & Katharina Wüllner, 2017. "New developments in behavioral pricing research," Journal of Business Economics, Springer, vol. 87(6), pages 809-875, August.
    10. Hsin‐Hui Lin & Pin‐Han Chen & Chih‐Lun Wu, 2023. "Exploring the price anchoring effect in mobile commerce: An experimental study," Managerial and Decision Economics, John Wiley & Sons, Ltd., vol. 44(3), pages 1601-1623, April.

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