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This paper reports the results of an experimental study where four characteristics of premium‐based sales promotions were manipulated in the context of a computer purchase: the attractiveness of the premium, the extent to which it fits the product category, the reception delay of the premium, and the mention of its value. The results show that these factors had interactive effects on consumer reactions. Thus, although the attractiveness of the premium generally had a positive impact on consumer appreciation of the promotional offer, a promotion including an unattractive premium was nevertheless positively evaluated if the premium was a good fit to the product category. Sales promotions, including a premium that fits well the product category, were less likely to be perceived as manipulative. However, if the product‐premium fit was poor and the premium was not attractive, mentioning the value of the premium helped to reduce the perceptions of manipulation intent. It is concluded that more research is needed on this managerially relevant topic in light of the complex dynamics that appear to underlie the relationships between the characteristics of premium‐based promotions and consumer reactions.

This study aims to increase the understanding of the emergence of a values-based (VB) premium private label (PL) brand reputation within a multiple-tier PL brand portfolio in retailing.

By building on the research on PLs, brand image, brand reputation and consumer values, this study creates a conceptual foundation for the emergence of VB PL brand reputation within a multiple-tier brand portfolio among consumers and examines the emergence of such reputation empirically using interpretive exploratory qualitative laddering interviews in the context of fast-moving consumer goods.

The findings of this study illustrate that the VB reputations of the premium PL product brand and the PL brand store intertwine, ultimately relating to two terminal values: pleasure and doing good. These reputations differ remarkably from the VB reputations of the economy PL brand and the umbrella brand of the retail chain (not doing good and financial security).

This study explains the emergence of VB brand reputation within a multiple-tier brand portfolio and introduces the use of the laddering technique in such research.

This study reminds brand managers to carefully design the relevant brand strategy for brands and their relationships under a brand umbrella.

Although much is known about PL brands and brand reputation, to the best of the authors’ knowledge, this study might be the first to increase the understanding of how a VB premium PL brand reputation emerges and accumulates from brand images within a multiple-tier brand portfolio.

The purpose of this study was to investigate how a consumer’s intention to purchase a premium or luxury product influences the anticipated regret and guilt.

A 2 × 2 × 2 between-subjects design (label: premium versus luxury × prior event: success versus failure × product type: hedonic versus utilitarian) on guilt and regret was implemented.

Following a successful event, the anticipated regret and guilt are lower for a hedonic product compared to a primarily utilitarian one. The effect was valid when the consumers were looking to buy both luxury and premium. In a situation following a failure, the anticipated levels of regret and guilt were lower for a product that was primarily utilitarian in nature; however, this effect only appeared when the participants were looking to buy both luxury and not premium.

People may feel more licensed to indulge in a hedonic premium or luxury product after a success and more licensed to indulge in a utilitarian luxury product after a failure.

The results can be used to understand how to optimize a marketing message of indulgence whether or not one deserves it.

The study provides novel insight into how anticipated guilt and regret may be evoked by the goal of buying a premium versus luxury product in combination with the product type and a consumer’s experience of a prior event.

The main aim of this paper is to examine the role of brand reputation on the impact of value product on perceptions of a premium product from the same brand. As a secondary goal, it tests and extends existing findings from judgment tasks to a choice task.

Two online experiments are presented. In Study 1 (1a and 1b), participants provided quality and price judgments to products. Brand reputation was manipulated by comparing common store brands to non-store brands (Study 1a) and to upscale store brands (Study 1b). In Study 2, we examined whether findings indicating a positive effect of a value store brand on a premium store brand extends to a choice context. Participants made choices between a premium store brand and a national brand in the presence of either a value store brand or a value national brand.

It was found that brand reputation plays an important role in the interplay of products in line extensions. While the positive impact of a value brand on a premium brand is at its strongest level for a regular store brand, it still has a moderate size for a non-store brand without a defined reputation, as well as for an upscale store brand. Second, using a choice task, we reject an important rival explanation for the impact of a value store brand on a premium store brand observed in previous research.

The authors have focused on consumers’ expectations of products. While research has shown that these expectations play an important role in evaluations, future research may directly examine perceptions after consumption. The findings also offer an opportunity for future research to examine the differences in perceptions between store and non-store brands at different positioning levels, as well as other factors that affect brand reputation.

The findings have two practical implications. First, our results indicate that when a manufacturer produces two products in the same category at different levels of quality, there is some benefit in letting consumers know about this relationship. The authors consistently found no negative impact on the brands and often a positive impact on the premium brand. While effects are stronger for common store brands, they are likely to emerge for any type of brand, albeit weaker.

This paper contributes to the nascent literature on multi-tier brands and vertical extensions in several ways. First, the role of brand reputation was examined and how it interacts with positioning in line extension context. Second, we show that the effect of a value brand on a premium brand is stronger for store brands, but still existent for non-store brands. These results offer implications for practice and open opportunities for future research on multi-tier store brands.

The purpose of this study is to seek to investigate whether and how country of origin (COO) cues – category-country image (CCI) and typicality – and importers’ domain-specific innovativeness (DSI) influence importers’ propensity to the trial new value and premium products. Moreover, it aims to understand whether and how the relationship between the COO effect and industrial purchase intentions is moderated by importers’ propensity to innovate (DSI).

International importers completed a quantitative online survey. Factor analysis was used to summarize the latent constructs into orthogonal scores. General linear modeling was applied to the scores to test the hypotheses.

The results indicate that importers’ propensity to trial value products is directly influenced by CCI and importers’ DSI. For premium products, typicality has a positive effect on their propensity to trial. Also, CCI and DSI have positive effects on the trial of value products, and the effect is more pronounced than for premium products. Importers’ DSI positively moderates CCI in premium product trials, while it negatively moderates typicality in value products.

This research provides important managerial implications for practitioners seeking to increase foreign sales, strengthening importers’ product perceived value through COO cues. Exporters should distinguish between value and premium products and, in the selection of international channel partners, they must be attentive to importers’ personal characteristics, such as their propensity to innovate. Exporters selling value products should communicate CCI more clearly and, when targeting innovative importers, opt for atypical products instead of traditional ones. For premium products, which require more complex decisions, exporters should especially underscore product typicality and, with innovative importers, emphasize positive CCI.

By focusing on the two critical issues of product selection and price levels, this study’s original contribution is to emphasize that, for the same product category, in industrial purchasing decisions of value versus premium products, the COO effect can be different. It also highlights the importance of investigating the COO effect by concentrating on industrial buyers’ personal characteristics, here the DSI of importers, as moderating variables.

The purpose of this paper is to investigate whether consumers in pre-owned durable goods markets (such as pre-owned automobiles) purchase products with higher premium/luxury positioning in a vertical line-up compared to consumers in new durable goods markets. The moderating role of brand loyalty on choice is also investigated.

The hypotheses are tested using a data set that includes the sales of new and pre-owned vehicles from an independently owned automotive dealer in the Northwestern USA during the first nine months of 2017 (N = 200). An ordered logit regression is used to estimate the relationship between consumers’ purchase of pre-owned vs new vehicles and the premium-level of the model that they choose, while controlling for the vehicle price. Two experimental robustness tests are conducted to provide empirical evidence of the proposed theoretical process.

Consumers who purchased pre-owned vehicles chose models with higher premium/luxury positioning compared to consumers who purchased new vehicles, even when controlling for price. This effect was moderated by brand loyalty, such that consumers’ premium-level of purchase was magnified if they previously owned a vehicle of the same brand. The results of an experimental robustness test indicated that consumers’ preference for pre-owned vehicles with higher premium/luxury positioning was because of greater perceptions of the quality along the dimensions of versatility, performance and prestige.

Sellers of complex durable goods (e.g. automobiles) should consider segmenting their upselling strategies for pre-owned vs new products. They should specifically focus more effort on the upselling of pre-owned durables as buyers appear more likely to pursue premium/luxury alternatives compared to new durables. Further, they should focus upselling efforts for pre-owned durables on brand loyal consumers.

To the best of the authors’ knowledge, this work is the first to examine consumers’ desire for pre-owned durable goods with premium/luxury positioning in a vertical product line-up. Further, it is also the first to explore the role of brand loyalty in shaping consumer preferences for premium/luxury pre-owned durable goods. As such, it makes an important contribution to an emerging literature exploring the appeal of premium and luxury pre-owned goods. Much work in this area has focused on the motivations that consumers have for buying pre-owned premium and luxury nondurable goods, such as vintage clothing or accessories. By contrast, the present research investigates the appeal of premium/luxury positioning for complex, pre-owned durable goods (vehicles), which are more difficult for consumers to evaluate at the point-of-purchase.

This study aims to provide a comprehensive explanation of the linkage between premium segments and product innovation. While previous literature confirms that product innovation triggers premium segment emergence, and vice versa, there is no satisfactory explanation regarding the underlying mechanisms that drive the mutual shaping of premium segments and product innovation. This paper attempts to address this gap in literature.

This study employs a cognitive model of technology trajectories and empirically examines the Japanese rice cooker market using a mixed-methods approach. The methods used consist of content analyses of newspaper articles and press releases and case analyses of manufacturers' new product development.

Content analyses show the emergence of a premium segment within the Japanese rice cooker market as well as a simultaneous change in technology trajectories. Case analyses subsequently reveal the mechanisms that link the premium segment emergence and technology trajectory changes. The analyses also explore this linkage in detail; market actors' technological frames and interpretation processes mediate the mutual shaping of the premium segment and product innovations.

This study presents quantitative evidence indicating the emergence of a premium segment and changes in technology trajectories. It provides a qualitative explanation for the linkage between these two phenomena, which may serve as a viable foundation for future research in premium strategy.

This study examines the empirical relationship between four broad antecedents of brand equity (branding strategy, brand structure, brand positioning and target market) and two separate dimensions of revenue premium: price premium and volume premium. Our modeling framework aims to explain how different antecedents of brand equity influence the realized velocity and margin of branded product sales, key drivers of operating cash flow. Our generalizable empirical analyses are based on a representative dataset of over 6,500 brands, across 200 consumer-packaged goods categories, spanning three years. We find that only 20% of brands command revenue premiums, for which volume premiums are the critical determinant. Branding strategies and brand structure primarily impact volume premium. In contrast, brand positioning has little effect. Target market substantially affects both premiums. Overall, these four elements account for 73% and 69% of the explained variations in price and volume premiums, respectively. This study provides generalizable, important, and novel insights for the theory and practice of brand management regarding price positioning and extending brands into new categories.

This study aims to analyse what type of premium, hedonic or utilitarian, is preferred in a promotional context. Additionally, it seeks to examine the role of affective and cognitive reactions in decision processes where utilitarian and hedonic premiums are involved.

Three experiments were conducted. A single factor within-subjects design was employed, with the nature of the premium (hedonic/utilitarian) as the treatment factor. Respondents were asked to make their choice between two promotional offers. Affective and cognitive reactions were measured. Regression analyses were conducted to test the hypothesized effects.

The results show that hedonic premiums are preferable to utilitarian ones in a promotional context, other characteristics of the premium (e.g. premium attractiveness) being equal. The findings also identify that a preference for the hedonic/utilitarian premium is more likely to emerge when affective/cognitive reactions are incited, and indicate that the nature of the preferred premium determines the mediating effect of cognitive reactions.

The paper only focuses on the hedonic/utilitarian nature of the premium. However, premiums come in very different forms and several characteristics – such as a premium with a relatively low price, the reception delay of the premium, and the perceived fit between the product and the premium – may reverse the relative preference for hedonic premiums.

The hedonic vs utilitarian nature of the premium should be considered when planning premium promotion. It appears that the use of more hedonic premiums increases the effectiveness of promotional actions alongside other variables such as premium attractiveness, the promotional benefit level or the product-premium fit. Furthermore, the type of premium offered influences the role of affective and cognitive reactions aroused during shopping. Thus, the nature of the premium may influence the reactions of consumers when participating in promotional actions.

The research extends the factors that may explain the effectiveness of premium promotions, since few studies to date have focused on the hedonic or utilitarian nature of premiums.

This study evaluates the impacts on gross revenue distributions of the use of alternative crop insurance products across different coverage levels and across locations with differing yield risks. Results are presented in terms of net costs, values‐at‐risk, and certainty equivalent returns associated with five types of multi‐peril crop insurance across different coverage levels. Findings show that the group policies often result in average payments exceeding their premium costs. Individual revenue products reduce risk in the tails more than group policies, but result in greater reductions in mean revenues. Rankings based on certainty equivalent returns and low frequency VaRs generally favor revenue products. As expected, crop insurance is associated with greater relative risk reduction in locations with greater underlying yield variability.