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The purpose of this paper is to present the concept of consumers' erroneous affective self‐forecasts, and discuss the implications of such forecasts for consumer…
The purpose of this paper is to present the concept of consumers' erroneous affective self‐forecasts, and discuss the implications of such forecasts for consumer purchasing behaviour and marketing planning.
First, the literature on inaction inertia – the lowering of the likelihood that a bargain will be taken once a better bargain has been missed – is reviewed. Second, the literature on affective self‐forecasting is reviewed. Finally, the implications that the authors synthesis of the behavioural evidence carries for marketing are discussed.
The inaction inertia literature implicates the regret that consumers associate with purchasing a discounted item once they have missed a much larger discount on it as a major contributing factor to consumers' unwillingness to purchase the item on the second occasion. The literature on affective self‐prediction suggests that regret (and other emotions) is systematically mispredicted.
The likely effect of erroneously anticipated regret in inaction inertia situations is depressed purchasing behaviour. The paper argues that because affective anticipations are typically erroneous, their impact on consumer decision‐making processes cannot be deemed rational. It is proposed that marketing should intervene to either increase the accuracy of such anticipations, or to lead consumers to discount them.
Price promotions can have negative side effects, such as those observed in inaction inertia circumstances. To some extent, these are driven by consumers anticipated regret (and possibly other relevant emotions). Marketing techniques can counteract the disproportionate impact of such emotions.
The paper offers a synthesis of behavioural evidence on inaction inertia and affective self‐forecasting – two quite separate literatures that have yet to be brought together in the present context. In addition, the paper outlines implications for marketing and suggests possible strategies to moderate the discussed effects.
Posits that in any business there seems to be three general activities: first, businesses must attract and keep their customers; second, businesses must produce services or goods for their customers; third, businesses must renew production and ways of relating to customers. Concludes that organizations must attract, satisfy and keep customers.