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When and whom should retailers offer price reductions in times of crisis?

Haeyoung Jeong (School of Business, North Carolina Central University, Durham, North Carolina, USA)
Siddharth Bhatt (The Pennsylvania State University Harrisburg, Middletown, Pennsylvania, USA)
Hongjun Ye (Clarkson University, Potsdam, New York, USA)
Jintao Zhang (College of Business, Drexel University Bennett S LeBow, Philadelphia, Pennsylvania, USA)
Rajneesh Suri (College of Business, Drexel University Bennett S LeBow, Philadelphia, Pennsylvania, USA)

International Journal of Retail & Distribution Management

ISSN: 0959-0552

Article publication date: 14 December 2021

Issue publication date: 10 May 2022

212

Abstract

Purpose

With a decrease in consumer spending during the coronavirus disease 2019 (COVID-19) pandemic, many retailers are offering price reductions to stimulate demand. However, little is known about how consumers perceive such price reductions executed during turbulent times. The authors examine whether the timing of price reductions and individual differences impact consumers' evaluations of the retailers offering such reductions.

Design/methodology/approach

Using a longitudinal design, the authors inquire into four retailers' motives that consumers may infer from a price decrease at two different times during the COVID-19 crisis.

Findings

The authors find that the timing of price reductions plays a key role in shaping consumers' inference of retailers' motives. The authors also uncover individual characteristics that affect consumers' inferences.

Originality/value

This research advances the literature by demonstrating the critical role of timing and individual characteristics in consumers' perceptions of price reductions during times of crisis. The authors findings also provide retailers with actionable insights for their pricing strategies. The findings may be generalizable to other types of crises that may arise in the future.

Keywords

Citation

Jeong, H., Bhatt, S., Ye, H., Zhang, J. and Suri, R. (2022), "When and whom should retailers offer price reductions in times of crisis?", International Journal of Retail & Distribution Management, Vol. 50 No. 6, pp. 744-759. https://doi.org/10.1108/IJRDM-08-2020-0293

Publisher

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Emerald Publishing Limited

Copyright © 2021, Emerald Publishing Limited

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