Abstract
This study investigates the effect of price promotions for musicals on consumer perception of fairness toward other similar musicals and the role of consumer involvement in performing arts as a moderating variable. A threshold regression estimation which was performed using data from a survey on South Korean consumers showed a decrease in consumers’ fairness perception once they became aware of discounts on similar performing arts and, consequently, a decrease in their intent to purchase tickets at regular prices. The results also showed that the samples can be split into low- and high-involvement groups, with the effect of fairness perception on purchase intention statistically significant for both groups, however, larger for the high-involvement group; the high-involvement group is expected to consume more performing arts products than the low-involvement group. These results imply that consumer perception of unfairness regarding ticket price discounts may negatively affect the long-term profits of performing arts suppliers.
Highlights
During the last decades in South Korea, ticket sales for performing arts have grown, fueled by continual economic growth and government policies supporting domestic leisure activities
The results support Hypothesis 1 (H1), which states that the knowledge of price promotions for similar shows affects the perception of fairness of tickets at regular prices
We investigated the responses of consumers facing the price promotion of similar musicals and the effects of respondents’ perceived unfairness on their intention to purchase performing arts tickets at regular prices
Summary
During the last decades in South Korea, ticket sales for performing arts have grown, fueled by continual economic growth and government policies supporting domestic leisure activities. The sales increased from 190 billion Korean Won in 2003 to 748 billion Korean Won in 2016, representing a 293% increase [1]. The number of performing arts suppliers increased during this period. The competition in the market intensified, with increased sales promotions through discounts on ticket prices. Previous studies have shown that South Korean consumers have a relatively high price elasticity for performing arts [2,3,4]. Colbert [5] and Lin [6] suggest that differentiated pricing is essential for some groups to consume arts products
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