Abstract
Similar to traditional luxuries, affordable luxuries enjoy a high level of perceived product quality and perceived social status, but the effectiveness of price promotions of purchasing affordable luxury products is different from that of traditional luxuries. In order to further investigate the purchases of affordable luxuries, we used event-related potential (ERP) technology to reveal the formation of the purchase intention toward affordable luxuries at original prices (high or low) and current prices (discounted or non-discounted). Compared with the high-priced affordable luxury without a price promotion and the low-priced affordable luxury with a price promotion, consumers showed a stronger intention toward the high-priced affordable luxury with a price promotion, by weighing up three factors, perceived product quality, perceived social status, and perceived monetary saving at the behavioral level. A shorter reaction time emerged in the price promotion condition than in the absent price promotion condition when the original price was low. At the neural level, a decrease in N2 amplitude was found in the high original price and discounted current price condition than the high original price and non-discounted current price condition and the low original price and discounted current price condition, respectively, suggesting that the price information of the latter two conditions might not be the expectation information of subjects, and thus, the enhanced conflict is produced. The high-priced affordable luxury product without a price discount evoked a more positive LPP amplitude than the high-priced affordable luxury product with price promotions or than the low-priced affordable luxury item without price promotions, demonstrating that participants could regard the former as an evaluative inconsistent condition and the latter as evaluative consistent conditions. These results are helpful to better understand the effects of price promotions on purchasing affordable luxury products at different original prices.
Highlights
Traditional luxuries are products of high quality and high price, and it makes consumers feel socially superior (Mazzocco et al, 2012) and proud (Bellezza and Keinan, 2014)
As a confirmatory follow-up, the simple effect analyses revealed that when the original price was high, participants showed stronger purchase intention to the affordable luxury product with a price promotion (4.353 ± 0.097) than that without (2.661 ± 0.203, p < 0.001) and that when the original price was low, there was no significant difference between the absent (2.273 ± 0.123) and present (2.144 ± 0.257, p = 0.599) price promotion conditions
The simple effect analyses showed that when the original price was high, significant difference between absent (737.069 ± 53.924 ms) and present (680.799 ± 52.622 ms, p = 0.140) price promotion conditions was not found and that when the original price was low, subjects responded to the discounted price (648.322 ± 40.522 ms) more quickly than the non-discounted price (801.621 ± 73.399ms, p = 0.003)
Summary
Traditional luxuries are products of high quality and high price, and it makes consumers feel socially superior (Mazzocco et al, 2012) and proud (Bellezza and Keinan, 2014). Traditional luxuries tend to combine high perceived prestige with extremely high price premiums. Affordable luxury products are sold at reasonable price premiums for mass and still enjoy a neutral. Price Promotions and Affordable Luxuries and reasonable level of perceived prestige (Silverstein and Fiske, 2005). Consumers think that affordable luxuries representing a signal of economic power have the same goods characteristics (such as high quality, high priced, and exclusive) as the traditional luxuries (Mundel et al, 2017). Highorder social and psychological desires, as one of the most influential factors, can drive both traditional (Wiedmann et al, 2009) and affordable luxury purchases (Shahid et al, 2021)
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