Deal Proneness Research Articles

Mindsets, shopping motivations and compulsive buying: Insights from China

AbstractThis study investigates how mindsets (i.e., the beliefs that individuals have about the nature of human characteristics) are associated with compulsive buying behavior (i.e., the tendency to buy impulsively and obsessively). In particular, we test the relationships between consumer mindsets, three shopping motivations (deal proneness, social comparison, and hedonic motives) and compulsive buying. Based on a survey of 421 respondents conducted in China, our findings reveal the mechanism through which mindsets affect compulsive buying. The results show that when consumers believe in the consistency of personal traits (fixed mindset), they tend to be more vulnerable to deal offers and social comparison. These motivations increase the desire to seek hedonic pleasure, which is associated with a greater propensity for compulsive buying. However, when consumers believe that personal traits can be changed and developed (growth mindset), they seek hedonic pleasure in shopping, which result in a greater tendency to engage in compulsive buying. The present study adds to the existing body of knowledge by unveiling how different mindsets are associated with compulsive buying. In terms of practical implications, this study provides policy makers and marketers with a better understanding of the different motivations that lead to compulsive buying.

Intention to adopt mobile payment in physical stores

PurposeThe purpose of this paper is to develop a theoretical model based on Push–Pull–Mooring (PPM) framework consisting of direct, indirect and moderating effects, derived from technology acceptance model, unified theory of acceptance and use of technology and other extended theory, to address the main factor influencing an individual in adopting mobile payment (MP) in physical stores. The research, therefore, utilized individual switching behavior as an underpinning to explain MP adoption in an offline context.Design/methodology/approachThe theoretical model was tested by collecting data from 459 respondents in Indonesia through online self-administered questionnaires.FindingsThe finding indicated consumer innovativeness has the most influential direct effect on MP adoption, followed by deal proneness, perceived convenience and perceived herd behavior. Meanwhile, perceived enjoyment and subjective norms were found to have an indirect effect on the adaptation of MP through mediator convenience. Furthermore, age, gender, occupation and income did not have any moderating effect for all the direct influence of MP adoption.Originality/valuePrevious literature only focused on direct intention. However, this study observed the adoption of MP in a physical store by involving the switching behavior. It specifically puts concern and objective as the factors that influence user intention to switch from their old payment system to the MP system in bricks and mortar store using PPM framework.

The cross-buying effect in a multi-vendor loyalty program in Korea

This study investigates the factors weakening the relationship between a customer’s cross-buying and firm sales in a multi-vendor loyalty program (MVLP) in Korea. The findings indicate that cross-buying has a positive impact on purchase frequency, transaction size, and further cross-buying in the subsequent periods. However, this impact is attenuated when customers are inclined to deal proneness or spending limit. The findings give academics and managers the opportunity to reconsider the conventional assumptions about cross-buying. Instead of emphasizing cross-selling for random customers, firms must identify customers whose cross-buying behavior affects firm performance positively. This study has managerial implications for MVLP operators for the effective acquisition and retention of participating vendors.

What’s the deal? Consumer price involvement and the intention to purchase suboptimal foods. A cross-national study

Retailers aim to supply consumers exclusively with food products that are flawless, and therefore impose strict standards that foods have to comply with before deemed qualified for retail. This practice results in large amounts of foods, suitable for human consumption, to be discarded due to deviation from these standards. In an effort to battle food waste, retailers have begun to offer suboptimal food products on price promotion. However, consumers’ reactions to price promotions are not uniform and depend on the significance individuals assign to these promotions, based on their own price involvement. An online questionnaire administered to a total sample of 3,114 consumers divided across representative samples of Dutch (n = 628), German (n = 622), Swedish (n = 620), Norwegian (n = 625) and Danish (n = 619) consumers aimed to investigate the effect of five price involvement dimensions (Deal proneness, Value consciousness, Price consciousness, Price-Quality schema, Prestige sensitivity), Perceived budget constraints, and current use of suboptimal foods on consumers’ intention to purchase these products in the near future. Results indicate that consumers’ intention to purchase suboptimal foods is influenced by different price involvement dimensions within and across countries. These findings offer evidence that a more nuanced approach to price promotions can increase consumers’ intentions to purchase suboptimal foods and thus prove an efficient marketing tool that can be used to help reduce food waste. Retailers could benefit from applying price promotions that tap into the price involvement dimensions that increase consumers’ intentions to purchase suboptimal foods, in contrast to the current practice of applying uniform price reductions.

Analysis of factors influencing the deal proneness of consumers for processed foods

Analysis of factors influencing the deal proneness of consumers for processed foods

Thrilled to Have “Bagged a Bargain” or “Bitter” and “Very Frustrating”? Exploring Consumer Attitudes to Value and Deals in Tourism

Similar to most global tourism markets, UK consumers adjusted their behavior during the global financial crisis, emphasizing value for money in travel choices. However, there is little evidence concerning consumers’ value-seeking behavior and especially how deals, discounts, and other sales promotions influence tourist decision making. This project explores concepts of value consciousness and deal proneness to shed light on attitudes toward monetary value in travel purchases. Using focus groups, the study found that deals and discounts frequently underpin some tourist choices, but that value consciousness is related to deal proneness, and interactions between the two could result in negative, positive, or mixed emotions. This relationship was captured through a dynamic categorization of tourists’ attitudes and behavior into four approaches to deals and value, namely, deals (1) as a way of life, (2) as a bonus, (3) as a problem, and (4) as toxic. The categories were dynamic in that individuals could move across them. The implications for tourism marketers are outlined.

Deal proneness and national culture: evidence from the USA, Thailand and Kenya

PurposeCulture is one of the critical variables in explaining consumer behavior and consumer response to external stimuli. The purpose of this paper is to delineate the relationship between deal proneness and culture. Specifically, this paper examines the relationship between Hofstede’s cultural dimensions, namely, power distance, individualism/collectivism, masculinity/femininity and uncertainty avoidance, and deal proneness. Additionally, the role of store image as a moderator between culture and deal proneness is explored. Finally, the paper offers prescriptive and descriptive insights for marketers to consider cultural perspectives when promoting products internationally. A clear understanding of cultural influences on deal proneness will allow marketers to target specific customer segments more accurately.Design/methodology/approachThe authors collected data from consumers in shopping malls in USA, Thailand, and Kenya. The authors analyzed the data using structural equation modeling.FindingsThe authors found that societies with a high femininity index are more likely to respond to deals than masculine societies. An inverse relationship between the Power Distance Index (PDI) and deal proneness may exist, suggesting that societies with a high PDI may be less deal prone. The authors found that individualism index is positively related to deal proneness, and thus societies with a low individualism index should be more deal prone. Finally, individuals in high uncertainty avoidance countries are expected to exhibit low deal prone tendencies.Research limitations/implicationsThe study utilized a sample from cities. Consequently, future studies may attempt to validate the relationship posited in this study by utilizing non-urban data. Additionally, the authors look at stores in a mall. Thus, there is a possibility of interaction between mall image and store image. It may be useful to validate the findings of this study by using data from stand alone stores and also examine the interaction effect of mall image and store image on the deal proneness in a given culture.Practical implicationsThis study suggests that appropriate store selection for offering deals can possibly augment the effectiveness of deal-based promotions. Specifically, choice of store can alter the context, and thus the perception of the value proposition could increase, which in turn is likely to increase the acceptance of deal-based promotion.Originality/valueAlthough several researchers have also examined differences in consumer behavior across cultures yet it appears that there is no direct study that examines the effects of cultural differences on deal proneness using data from three countries (USA, Thailand, and Kenya) which are diverse on all dimensions of national culture. This paper examines the influence of national culture on individual’s propensity to exhibit deal proneness. Furthermore, the paper examines the role of store image on the relationship between national culture and deal proneness.

Conditional Promotions and Consumer Overspending

This study investigates the effects of conditional promotions (e.g., buy 2 or more, get 30% off; spend $50 or more, get $15 off) on consumer behavior and the seller's profit. When a deal is presented with a minimum purchase quantity or a minimum spending requirement, experimental studies have shown some consumers are induced to spend more in order to obtain a discount. To study this behavior, we model a market in which consumers can be heterogeneous in two dimensions: willingness to pay for the product and deal proneness to a price discount. We examine two types of conditional promotions that are widely used in practice: (i) all‐unit discount, in which a price reduction applies to every unit of a purchase once the minimum requirement is met, and (ii) fixed‐amount discount, in which a fixed amount of discount is awarded to the total expense that meets the requirement. We show that deal‐prone consumers may be induced to overspend when offered a conditional discount. However, consumer overspending benefits the seller only when the market contains a sufficiently large proportion of highly deal‐prone or high‐valuation consumers. Comparing the two types of discounts, we show that the all‐unit discount outperforms the fixed‐amount discount when the regular price for the product is high, whereas the fixed‐amount discount is more profitable than the all‐unit discount when some consumers would make a purchase even without a discount. Our study suggests adopting an appropriate type of conditional discount can effectively improve the seller's profit over what would be obtained through selling at the regular price or a conventional price markdown. Furthermore, we find that conditional discounts can also improve consumer welfare, resulting in win‐win situations for both retailers and consumers.

MINDSETS, DEAL PRONENESS AND COMPULSIVE BUYING

MINDSETS, DEAL PRONENESS AND COMPULSIVE BUYING

Effect of Encumbrances on Response to Sales Promotions

Sales promotions serve as important marketing tools to obtain immediate incremental sales. However, sales promotion campaigns are profitable only if the promotional offers (deals) can induce switch from competitor brands. However, redeeming deals may necessitate the purchase of less preferred brands and patronization of non-preferred stores, and incurring extra-expenses for subscribing to extra newspapers and magazines to obtain deals such as coupons and contests. Therefore, consumers may perceive brand, store and extra-expense encumbrances while responding to the deal offers. Thus, marketing strategists face an important question: whether these encumbrances have any impact on the consumers’ response to deals. This study addresses this question and finds significant positive effect of encumbrances on deal proneness. The study is carried out across multiple deal types and two product categories for generalization of the findings.

Service failures after online flash sales: role of deal proneness, attribution, and emotion

PurposeThe purpose of this paper is to focus on failures in online flash sales (OFS) and to explore why consumers participate in an OFS even after experiencing service failure. It also examines the role of deal proneness, attribution, and emotions.Design/methodology/approachUsing a mixed method approach to gain insights into this relatively unexplored phenomenon of OFS, this research uses netnography followed by a survey study.FindingsThe findings show that deal-prone customers tend to ignore service failures during OFS and re-participate in the future. In the context of OFS, failures attributed to internal locus of attribution (LOA) also have a negative effect on re-participation compared with failures attributed to external LOA. Furthermore, there is a three-way interaction among deal proneness, LOA, and past emotions. The results show that negative past emotions further exacerbate the impact of attribution on the link between deal proneness and re-participation.Originality/valueIn contrast with prior research, the paper shows that consumers participate even after service failure. The proposed difference is between customers who experience different LOA and past emotions offers insights into their behavior after service failure in a new context of an online/electronic commerce event – flash sales. This paper specifically explores the role of internal LOA and finds that it has a more negative impact than external LOA on re-participation.

The Moderating Effect of Deal Proneness on the Influence of Involvement on Restaurant Group-Buying Purchase

The Moderating Effect of Deal Proneness on the Influence of Involvement on Restaurant Group-Buying Purchase

The Moderating Effect of Deal Proneness on the Influence of Involvement on Restaurant Group-Buying Purchase

The Moderating Effect of Deal Proneness on the Influence of Involvement on Restaurant Group-Buying Purchase

The effects of consumer perception of volume discount benefits on intention to purchase grocery products

PurposeThe purpose of this paper is to investigate the effects of consumers’ perceptions towards volume discount (VD) benefits on their intention to purchase grocery products under this scheme using deal proneness as a moderator.Design/methodology/approachData were gathered through a survey of 583 Malaysian consumers, and were analysed using the partial least squares technique.FindingsThe results showed that perceived savings, self-expression value, and convenience positively affected consumers’ intention to purchase grocery products under VDs. Deal proneness negatively moderated the relationship between perceived quality, innovation, and consumers’ intention to purchase under VDs.Practical implicationsThe findings of the study will help retailers to understand the effects of consumers’ perceptions of VD benefits on their intention to purchase products under VDs, thereby allowing retailers to promote products under VDs more effectively.Originality/valueAlthough the VD is a common type of sales promotion, this topic is rarely explored. This study thus contributes to the advancement of knowledge by determining the effects of the potential benefits of VDs on consumers’ intention to purchase.

Cultural context in word-of-mouth activity

Purpose The purpose of this paper is to investigate how monetary incentives foster purchase intention in WOM settings. Design/methodology/approach This study investigates offering mobile coupons as an incentive and word-of-mouth (WOM) tool. An empirical study compares achievable effects on WOM behavior in an Eastern cultural context, which an Indonesian sample represents, and in a Western cultural context, which a German sample of incentivized WOM represents. Findings Providing senders and receivers’ with differing incentives leads to German consumers having an unfavorable attitude toward such incentives, but not for Indonesian consumers. Furthermore, Indonesian consumers base their decision to redeem mobile coupons more on their personal judgment and their overall deal proneness, while German consumers rely on their personal judgment and on others’ opinion. Research limitations/implications There is a need to explore more countries to enrich the Western and Eastern cultural perspectives. Practical implications Western firms should consider providing senders and receivers with the same incentives. Alternatively, a non-transparent strategy might be a solution. For firms located in Indonesia, or in other Eastern societies, the transparency of the provided incentives is not a main concern, because inequality is not a big issue in an Eastern society, while senders’ or receivers’ deal proneness character strongly influences their intention to redeem a coupon. Originality/value The use of a mobile coupon as a novel incentive and WOM tool.

Consumer satisfaction in retail stores: theory and implications

AbstractThe substitution of small retail stores by the large stores has been a topic of debate among academics, practitioners, retailers and general public, especially in the context of foreign firms entering emerging markets such as China and India. The purpose of this research is to find out the determinants of consumer satisfaction in small and large retail stores in an emerging market, with a sample from India. Data were collected using a 39‐item structured questionnaire developed by the authors. The sample consists of 225 consumers who shop at retail outlets (Convenience sample of 125 consumers from small and 100 consumers from large stores respectively). Exploratory factor analysis grouped the 39 variables into 14 factors. Further, regression analysis revealed that six of the factors (Social desirability, staff friendliness, shopping economy, shopping ambience, family shopping and deal proneness) were major predictors of consumer satisfaction as they were found to be significant at 5% level. The significance of factors such as social desirability and staff friendliness imply that many consumers prefer those typical features of small stores, which in turn results in the likely coexistence of small retail formats in spite of the entry and proliferation of large retail stores from different countries. We posit three theoretical propositions to stimulate further research in this area.

The Relative Influence of Consumer Innovativeness, Brand Loyalty, and Deal Proneness on New Product Adoption: A Direct Product Experience Study

When consumers are introduced to new products, they often undergo a complex decision making process. Adopting an approach-avoidance conflict framework, this study examines the influence of three consumer dispositions, specifically consumer innovativeness, brand loyalty, and deal proneness on the adoption of an innovative premium consumer product being marketed under a new brand name. A panel of 132 households comprising a total of 493 consumers participated in a one-week trial of the new product/brand during which both pre- and post- test data were collected. Hypotheses were tested using structural equation modeling and multiple-group analyses to assess the moderating effects of demographic characteristics. The pooled results reveal that deal proneness (an avoidance mechanism) has the strongest influence on new product adoption, which contradicted the initial hypothesis of a negative relationship. The next strongest influence on new product adoption is consumer innovativeness (an approach mechanism), in the hypothesized positive direction. Brand loyalty (an avoidance mechanism) has a moderate negative influence as hypothesized. These influences are consistent between older and younger, as well as male and female consumer groups. These findings offer important implications to marketers of new products and provide directions for future research.

Antecedents and outcomes of market mavenism: Insights based on survey and purchase data

In this study, we explore three key dimensions (price search, human capital and perceived benefits) for their roles as influencers of market mavenism behavior by consumers. We also investigate the effect of market mavenism on several managerially relevant and observable market outcomes, such as cross-store price savings and deal proneness are explored. A primary data collection strategy that surveys consumers on their stated price search behavior and attitudes towards price search links explicitly with consumers' actual, observed purchase behavior. The findings are consistent with economics of information model for market mavens. Specifically, we find that mavens engaged in more cross-store price search and perceived a greater price dispersion among retailers. Along the human capital dimension, market knowledge of price and investment search were positive influencers of market mavenism. Lastly, the perceived benefit of prior market knowledge reduced future search for mavens, and reduced their need for cross-store price search.

“Can you do something about the price?” – Exploring the Indian deal and bargaining-prone customer

Purpose – The paper aims to study how deal- and bargaining-prone customers are different from each other. This paper brings out this difference based on psychographics encompassing values – consciousness, price mavenism and personality orientations – needed for special treatment (distinctiveness and play). Design/methodology/approach – The measurement model was assessed using both exploratory factor analysis and confirmatory factor analysis. The structural model was tested using structural equation modeling. Findings – This paper finds that value consciousness is a two-dimensional construct in the Indian context. This construct comprises two dimensions of value consciousness, including concern for price and concern for quality. The authors find that deal-prone customers are value conscious and price mavens. Bargaining-prone customers are value-conscious price mavens and have a high need for special treatment (play). Play orientation distinguishes between a deal-prone and a bargaining-prone customer. Research limitations/implications – The study was limited to grocery products. The consumers surveyed were urban and educated Indians. Practical implications – With the Indian markets being opened for Western retailers, it is imperative to study the Indian consumers. It is important to understand why the local neighborhood store is able to retain its customer base even when the organized fixed-price formats have been around for approximately 20 years. Originality/value – This is one of the few papers that tries to understand the Indian consumer’s buying behavior, especially with respect to their haggling nature. This paper further develops our understanding of the “deal proneness” and “bargaining proneness” constructs. The authors also study their differences based on psychographics.

Intergenerational Influence in Consumer Deal Proneness

Although there has been ample research on the correlates of consumer deal proneness, there has been little research on how deal proneness develops. In two studies of parent/adult–child dyads, considerable parent–child similarity both in overall deal proneness and in the pattern of preferences for particular types of sales promotions was found. Further, the second of these two studies indicates that parent–child similarity is mediated by communication between parents and their children and tends to be stronger among parents with a permissive parenting style. These results provide evidence that consumer enthusiasm for sales promotions is, to at least some extent, transmitted from parents to their children.