How rational thinking style affects sales promotion effectiveness

Abstract

Despite the widespread use of “buy one get one free” (BOGOF) and “multi-unit price” (MUP, e.g., buy two get 50% off, 2 for $Y/2) promotions in the hospitality industry, no prior research has compared their effectiveness. The current study examines consumers’ purchase intention as a function of (a) BOGOF vs. MUP promotions and (b) rational thinking style, which reflects the level of capability and enjoyment of thinking analytically and logically. The results indicate that people low in rational thinking style exhibited a higher purchase intention toward BOGOF (vs. MUP) promotions while their counterparts high in rational thinking style were indifferent across the two promotion types. Further, this study identifies an important boundary condition. When the amount of savings (e.g., buy 2, save $Y/2) is salient in the MUP promotion, consumers low in rational thinking style are equally attracted to both types of offers. Theoretical and managerial implications are discussed.