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Article
Publication date: 1 November 2011

Dhruv Grewal, Anne L. Roggeveen, Larry D. Compeau and Michael Levy

In this brief paper, the aim is to highlight three important pricing areas: the business strategies and pricing models that have evolved over the past 20 years of…

Abstract

Purpose

In this brief paper, the aim is to highlight three important pricing areas: the business strategies and pricing models that have evolved over the past 20 years of research, the customers that have been targeted, and the role of the internet on pricing. The advent of social media, mobile marketing and display technologies are likely to encourage researchers to pursue additional research on these topics.

Design/methodology/approach

The current paper is an essay aimed at stimulating pricing research in three major domains.

Findings

The authors review illustrative current practices and research findings pertaining to emerging pricing business models, customer target marketing and price dispersion on the web.

Research limitations/implications

The paper highlights areas that need empirical investigation.

Practical implications

Managers need to explicitly understand the role of these emerging technologies (e.g. social media, mobile media, and web‐application) and appropriately incorporate them into their pricing strategies.

Originality/value

The paper's central contribution is to stimulate additional research on key pricing areas.

Details

Journal of Product & Brand Management, vol. 20 no. 7
Type: Research Article
ISSN: 1061-0421

Keywords

Content available
Article
Publication date: 1 November 2011

Sarah M. Maxwell

Abstract

Details

Journal of Product & Brand Management, vol. 20 no. 7
Type: Research Article
ISSN: 1061-0421

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Article
Publication date: 1 November 2011

Joseph P. Redden and Stephen J. Hoch

This paper aims to outline a decision process for how consumers choose among two‐part tariffs which consist of a flat fee plus a per unit charge for usage over an…

Abstract

Purpose

This paper aims to outline a decision process for how consumers choose among two‐part tariffs which consist of a flat fee plus a per unit charge for usage over an allowance. The paper also seeks to examine what types of decision aids help consumers choose lower cost tariffs.

Design/methodology/approach

The approach used is two experimental studies.

Findings

Most consumers do not choose a tariff by calculating an expected cost because of usage uncertainty. They instead rely on simple comparisons of the overage rate, usage allowance, and flat fee attributes. These heuristics lead to systematic biases, beyond what actual true cost justifies, for favorable comparisons on these attributes. An online calculator improved choice of the lower cost option from 65 percent to 80 percent, yet this increased to 91 percent if people were also forced to consider a range of usage levels.

Practical implications

Consumers struggle to choose the lowest cost tariff, especially with uncertain usage. Consumers should realize the biases in their decision shortcuts and use the presented decision aids. Firms can leverage these biases by offering larger usage allowances (often done) and smaller overage rates (often not done), or correct them with decision aids.

Originality/value

Much work on tariffs assumes consumers calculate a cost, but the authors question this assumption, and show that consumers instead use simple attribute comparisons to deal with uncertain usage. An understanding of the specific heuristic consumers use allows the authors to better account for past effects, predict and establish new effects, and design effective decision aids. Results indicate tariff biases largely result from information processing shortcomings.

Details

Journal of Product & Brand Management, vol. 20 no. 7
Type: Research Article
ISSN: 1061-0421

Keywords

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Article
Publication date: 1 November 2011

Maria Petrescu

The objective of this study is to analyze price dispersion in the context of internet based shopping malls and assess which of the main informational elements available…

Abstract

Purpose

The objective of this study is to analyze price dispersion in the context of internet based shopping malls and assess which of the main informational elements available online about sellers affect online price dispersion.

Design/methodology/approach

The author collected data for 100 models of watches from seven major brands and 100 models of cameras from nine major brands available for sale on Amazon. Statistical regression of price dispersion against average price, number of stores, shipping charge variation, average number of customer reviews, variation in the percentage of positive reviews and a dummy variable of product type were performed.

Findings

It is shown that price dispersion is present even in an online shopping mall. The conclusion significantly adds to the online pricing research, by showing that price dispersion is influenced by the average product price and product type and shipping charges. The number of stores does not affect price dispersion because there is no obstacle impeding the customer from finding the prices for all stores. A key finding is that the number of customer reviews significantly influences online price dispersion.

Research limitations/implications

The study only analyzes price dispersion for two products using secondary data. Future studies can analyze different types of goods and focus on which elements affect the buyers' store selection by using primary data.

Practical implications

Managers can see that there are numerous other elements of information besides price that influence buying decisions. Practitioners need to note the importance of customer reviews in online settings, including the significance of the number of reviews as signal of experience and reliability.

Originality/value

The paper shows that online price dispersion exists even in the context of practically inexistent search costs. Even though the buyers have instant access to all prices of a product, they use a combination of elements in order to decide the seller selection. A key contribution of the study shows that the amount of information available about the seller and the customer reviews significantly influence online price dispersion.

Details

Journal of Product & Brand Management, vol. 20 no. 7
Type: Research Article
ISSN: 1061-0421

Keywords

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Article
Publication date: 6 November 2007

Roger M. Heeler, Adam Nguyen and Cheryl Buff

The paper seeks to propose and test a theory of the psychological impact of price bundling that is derived from bundling's economic impact. It is called the inferred…

Abstract

Purpose

The paper seeks to propose and test a theory of the psychological impact of price bundling that is derived from bundling's economic impact. It is called the inferred bundle saving hypothesis. In the absence of explicit information about bundle savings, consumers infer a bundle saving when presented with a bundle offer. It is suggested that inferred bundle saving provides a simple, parsimonious explanation for pre‐ and post‐purchase bundle effects.

Design/methodology/approach

The theory is tested in two laboratory studies that employ partial replications of two prior price bundle studies.

Findings

The results show that the inferred bundle saving effect is robust in both product and service contexts, and can potentially explain the bundle effects found in these two studies.

Research limitations/implications

Additional experimental studies are recommended to further test the proposed theory.

Practical implications

First, contrary to convention, it is not always optimal for firms to integrate price information in a single bundle price. Second, firms may sometimes use the price‐bundling format to signal a bundle saving without actually offering one. Third, firms can manage consumption and expected refund of bundles by manipulating consumer perception of bundle saving.

Originality/value

It is intuitive that consumers expect a bundle saving. However, this paper is the first to establish empirically the existence of this inferred bundle saving and demonstrate its potential as a theoretical explanation for various bundle effects. The research challenges the extant view that price bundling per se always enhances consumer pre‐purchase evaluation. Moreover, it connects economic and psychological research, as well as pre‐ and post‐purchase analysis, of bundle effects.

Details

Journal of Product & Brand Management, vol. 16 no. 7
Type: Research Article
ISSN: 1061-0421

Keywords

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Article
Publication date: 1 October 2006

James M. Hunt and Howard Forman

The purpose of this research paper is to examine the role corporate and individual risk (from the point of view of the pricing manager) plays in developing pricing strategies.

Abstract

Purpose

The purpose of this research paper is to examine the role corporate and individual risk (from the point of view of the pricing manager) plays in developing pricing strategies.

Design/methodology/approach

Managerial professionals in two graduate business programs were used to assess riskiness associated with pricing strategies. Grounded in attribution theory, t‐tests were used to compare the different types of risk associated with the various pricing strategies.

Findings

The findings suggest that pricing managers will view risk from different perspectives (i.e. corporate and individual) and that this “point of view” should have an impact on the pricing strategies selected.

Research limitations/implications

Research limitations include the use of graduate students in lieu of actual pricing managers. However, this research is a first step in examining the different perspectives of risk that may be taken by managers.

Practical implications

Pricing managers and organizations alike should be made aware of how a point‐of‐view perspective regarding risk can have a significant impact on selecting pricing strategies. The results of the study could provide guidance for corporations so that they can make sure pricing managers have the “correct” point of view regarding the riskiness of pricing strategies.

Originality/value

The research is the first to identify and examine the different risk perspectives. This provides value for academic research because it is the first in the area of risk regarding the different perspectives.

Details

Journal of Product & Brand Management, vol. 15 no. 6
Type: Research Article
ISSN: 1061-0421

Keywords

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Article
Publication date: 1 November 2011

Juan (Gloria) Meng

The purpose of this paper is to review and understand the underlying structure of price perception, to recognize how cultural factors influence price perception, and to…

Abstract

Purpose

The purpose of this paper is to review and understand the underlying structure of price perception, to recognize how cultural factors influence price perception, and to develop and empirically test a model of cultural differences and price perception.

Design/methodology/approach

This project gathered data from both China and the USA. Using the LISREL 8.52 program, a proposed model was tested and modified in order to obtain a parsimonious underlying structure explaining cultural influences on consumers' price perceptions.

Findings

Results of the data analysis show that culture factors do have significant effects on price perception. Internal reference price has a consistent and negative effect on the overall price perception of both goods and services purchase and durable and non‐durable goods purchase. However, the significant associations between price perception factors and overall price perception were only found in the services and non‐durable goods purchase but not in the durable goods purchase.

Practical implications

This study helps international marketers understand the cross‐cultural consumer behavioral differences in general and the price perception differences in particular. It also provides a series of guidelines for international pricing strategy and international promotion strategy on an operational level.

Originality/value

Theoretically, the paper integrates the solid base of work on domestic pricing from the Lichtenstein et al. study on price perception as well as work on culture from anthropology and sociology, international business, international marketing, and Hofstede's culture theory.

Details

Journal of Product & Brand Management, vol. 20 no. 7
Type: Research Article
ISSN: 1061-0421

Keywords

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Article
Publication date: 1 June 2009

Jeanne M. Wolfe and Sarah McCans

This paper reports on a pilot project to develop a 32-acre site made available by the City of Kampala for housing with the express purpose of promoting urban agriculture…

Abstract

This paper reports on a pilot project to develop a 32-acre site made available by the City of Kampala for housing with the express purpose of promoting urban agriculture. Started in 2004 under the leadership of a city agronomist, with the aid of research teams from McGill University, Montreal, Makerere University, Kampala, and financial support from IDRC, the project is still ongoing. The process is one of participatory planning with the future residents, a group of mixed ethnicity and religions from all parts of the city, and includes training in house construction and agricultural techniques. Project implementation has been slower than anticipated due to unforeseen hazards such as mislaid title deeds, unavailability of government resources, communication shut-downs, the time required to transact business, acquire permissions, permits and the like, and most recently by the threat of a major power line from the Bujagali Falls to serve Kampala being thrust through the site. We nevertheless remain optimistic of ultimate success.

Details

Open House International, vol. 34 no. 2
Type: Research Article
ISSN: 0168-2601

Keywords

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Article
Publication date: 1 March 2010

Joseph M. Ntayi, Irene Namugenyi and Sarah Eyaa

The purpose of this paper is to develop a comprehensive framework of achieving supplier delivery performance based on contract governance mechanisms, justice perceptions…

Abstract

The purpose of this paper is to develop a comprehensive framework of achieving supplier delivery performance based on contract governance mechanisms, justice perceptions and ethical behavior using cross sectional survey data from public procuring and disposing entities (PDEs) in Uganda. Public procurement contract governance covers the design, development, implementation and enforcement of contracts. It serves to align interests of the contracting parties, reduce opportunistic behavior, lower transaction costs, promote justice perceptions, improve ethical behavior and achieve value for money procurement. Poorly managed procurement contracts result in conflicts, yet in many developing countries only rich suppliers can afford to resolve disputes through courts. For other suppliers, justice is out of reach. While it has been assumed that contracts result in good performance, little research has been carried out to corroborate this assumption. In this paper we provide theoretical, empirical and policy implications of supplier delivery performance.

Details

Journal of Public Procurement, vol. 10 no. 4
Type: Research Article
ISSN: 1535-0118

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Article
Publication date: 1 September 2000

Jonathan C. Morris

Looks at the 2000 Employment Research Unit Annual Conference held at the University of Cardiff in Wales on 6/7 September 2000. Spotlights the 76 or so presentations within…

Abstract

Looks at the 2000 Employment Research Unit Annual Conference held at the University of Cardiff in Wales on 6/7 September 2000. Spotlights the 76 or so presentations within and shows that these are in many, differing, areas across management research from: retail finance; precarious jobs and decisions; methodological lessons from feminism; call centre experience and disability discrimination. These and all points east and west are covered and laid out in a simple, abstract style, including, where applicable, references, endnotes and bibliography in an easy‐to‐follow manner. Summarizes each paper and also gives conclusions where needed, in a comfortable modern format.

Details

Management Research News, vol. 23 no. 9/10/11
Type: Research Article
ISSN: 0140-9174

Keywords

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