Abstract
Although prices are the most discussed topic in consumer conversations, research has mostly neglected the field of price-related word-of-mouth (WOM). The present study picks up this research gap by analyzing the effects of price-WOM valence and price change communicated by WOM on consumer price perception. While a WOM sender’s opinion is a stronger predictor of the recipient’s perceived price fairness, a price change communicated by WOM has a stronger effect on price expensiveness perceptions. Innovators are found to be more positive with their price fairness judgment compared to imitators, and opinion leaders are more prone to price-WOM than non-opinion leaders.
Highlights
Word-of-mouth (WOM) is one of the most influential forces in a marketplace and there is no doubt that it will further increase in relevance (Allsopp et al 2007; Bansal and Voyer 2000; Kozinets et al 2010; Siems and Gerstandl 2011; Zhu and Zhang 2010)
To further understand the different impacts of WOM valence and a price change communicated by WOM on price perceptions, we adhere to the accessibility–diagnosticity model (Feldman and Lynch 1988)
We predict a price change communicated by WOM to have a higher impact than WOM valence, because expensiveness only deals with the perceived level of a price, as opposed to price fairness, which takes personal considerations of the WOM sender for a price being experienced as just, legitimate, and reasonable into account (Campbell 2007; Haws and Bearden 2006; Kwak et al 2015)
Summary
Word-of-mouth (WOM) is one of the most influential forces in a marketplace and there is no doubt that it will further increase in relevance (Allsopp et al 2007; Bansal and Voyer 2000; Kozinets et al 2010; Siems and Gerstandl 2011; Zhu and Zhang 2010). It is characterized as highly persuasive as well as extremely effective (Bristor 1990).
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