Dissertation
Communicating value through space: how space influences price evaluations
Doctor of Philosophy (Ph.D.), Drexel University
Jun 2019
DOI:
https://doi.org/10.17918/a7xp-7x88
Abstract
The role of price in consumers' decision to purchase a product has remained an important area of research. To communicate a lower sale price and increase the likelihood of purchase, retailers often provide a reference price alongside a sale price. Consumers evaluate the sale price against the retailer-supplied reference price and perceive a deal. While the practice of providing reference prices alongside sale prices (price comparison) has been shown to be effective in positively influencing consumers' decisions, the strategy is becoming less effective with every retailer practicing it. Further, the two strategies that retailers employ to accentuate this effect (exaggerating the reference price and dropping the sale price) are also limited. Hence, there is a need to research newer strategies that allow retailers to communicate a lower price and reduce the monetary sacrifice perceived by consumers. This dissertation proposes and validates one such strategy. Since prices are numbers, a deeper understanding of how we make sense of numbers will help understand how we evaluate prices. To that end, I inquire into literature on numerical cognition which examines how we make sense of numbers. The numerical cognition literature demonstrates that consumers use empty space as a reference in numerosity judgement tasks. Based on theoretical insights and empirical evidence from the numerical cognition literature, I propose that consumers use the empty space around a price as a heuristic when estimating the magnitude of the price. Across several studies, I show that when the empty space around the price is small, estimates about its magnitude are small and the resultant monetary sacrifice is low. This research demonstrates that marketers will be able to influence perceptions of monetary sacrifice by advertising prices in small spaces. Findings from this dissertation not only help better understand how we evaluate prices but also help advance our understanding of numerical cognition in general.
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Details
- Title
- Communicating value through space
- Creators
- Siddharth H. Bhatt - DU
- Contributors
- Rajneesh Suri (Advisor) - Drexel University (1970-)
- Awarding Institution
- Drexel University
- Degree Awarded
- Doctor of Philosophy (Ph.D.)
- Publisher
- Drexel University; Philadelphia, Pennsylvania
- Number of pages
- x, 117 pages
- Resource Type
- Dissertation
- Language
- English
- Academic Unit
- Bennett S. LeBow College of Business; Marketing; Drexel University
- Other Identifier
- 9552; 991014632209104721