Get Discount in Chocolate and Get More Toothpaste! The Effect of Product Preferences on Promotion About Price-Off and Value-Added According to Product Type: Focusing on Hedonic and Utilitarian Product

Abstract

Customers are usually confused with the difference between promotional price-off and value-added when they face with promotions for products. The author identifies a tendency among consumers to prefer which promotion when processing promotional extends change information and product price difference. In experimental studies, the author provides evidences in support of the effect and identifies managerially useful boundary conditions for when the effect is likely to manifest. Three studies reveal that customers prefer price-off for hedonic product (vs. Utilitarian product) and value-added for Utilitarian product (vs. Hedonic product) (H1, 2). Consumption guilty is used to explain these conditions (H3). Further, higher price and hedonic product, they tend to prefer higher price-off (H4). In utilitarian, on the other hand, customers tend to prefer higher value-added and lower price (H5). According to this state, I can find that the product preference is affected by promotions and price difference and the extent of promotional price discount and value-added is also changed on price in product type. The chapter concludes with a discussion of the theoretical and managerial implications of the findings.