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:. (sales promotions) (shopping basket) The compatibility with regulatory orientation, causes people to add more items, even unpromoted ones, to their.

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Presentation on theme: ":. (sales promotions) (shopping basket) The compatibility with regulatory orientation, causes people to add more items, even unpromoted ones, to their."— Presentation transcript:

1 :

2 (sales promotions) (shopping basket)

3 The compatibility with regulatory orientation, causes people to add more items, even unpromoted ones, to their baskets. Drawing on the theory of regulatory focus (Cesario, Grant, and Higgins 2004; Higgins 1998) and consumer mind-sets (Dhar, Huber, and Khan 2007; Gollwitzer, Heckhausen, and Steller 1990) the framing of the coupon savings message (Save $x versus Get $x Off) the expiration date restriction cue on the coupon (expiring same day versus expiring two weeks later). We also show that brands in a store may be a source of regulatory compatibility.

4 (Higgins 2000; Higgins et al. 1994) (promotion focus) (prevention focus)

5 1. Marketing Cues as Independent Primes of Regulatory Focus

6 (1) Framing of sales promotions as regulatory cues The savings message in sales promotions offers with savings messages framed as Get $x off or BOGO prime a promotion focus. offers framed as Save $x prime a prevention focus Another component of sales promotions is expiration date limits (offer expires _____) Consumers who anticipate short-term regret are more likely to purchase promoted items (Abendroth and Diehl 2006;Inman and McAlister 1994). Unrestricted offers or offers with a longer expiration date window are less likely to engender short-term regret (Abendroth and Diehl 2006). sales promotions with a longer expiration date are likely to activate a promotion focus, whereas those with immediate expiration dates are likely to activate a prevention focus

7 (2) Type of brand as regulatory cue Such differences in judgments about products stem preferences for safe or low-risk choices and for stability over change when people adopt a prevention focus (Aaker and Lee 2001; Liberman et al. 1999) Choices that reflect creative or risky decision making when people take a promotion focus (Aaker and Lee 2001; Friedman and Foster 2001; Liberman et al. 1999). consumers to associate less familiar brands with constructs related to a promotion focus and well-known brands with constructs related to a prevention focus.

8 2. Compatibility Among Multiple Sources of Activation The effects of compatibility between regulatory focus and message cues. How the regulatory orientations that marketing cues induce might interact, independent of regulatory focus.

9 (1) Cue compatibility with regulatory orientation. Message cues compatible with a regulatory orientation lead to greater persuasion (Aaker and Lee 2001, 2006; Zhao and Pechmann 2007), a greater willingness to pay for relevant products (Avnet and Higgins 2003, 2006), and greater motivational intensity (Forster et al. 2001). Brand type can be a regulatory cue. promotion focus compatible with sales promotions framed as gains, and with promotions that have longer expiration dates. prevention focus compatible with promotions framed as nonlosses, and with those that have short expiration dates. promotion focus compatible with sales promotions framed as gains, and with promotions that have longer expiration dates. prevention focus compatible with promotions framed as nonlosses, and with those that have short expiration dates. promotion focus to be more willing to include less familiar brands in their shopping baskets. prevention focus should favor well-known brands. promotion focus to be more willing to include less familiar brands in their shopping baskets. prevention focus should favor well-known brands.

10 (2) Compatibility between cues Lee and Aaker (2004, Experiment 3) manipulate perceived risk and message frame (gain or loss) in an advertisement and find that the gain frame was more effective for low perceived risk and the loss frame was more effective for high perceived risk. people who receive a gain-framed coupon or one with a longer expiration date to be more willing to include less familiar brands in their shopping basket than people who receive a coupon framed as a nonloss or one with an immediate expiration date, who instead will favor purchases of well-known brands.

11 3. Effects on Size and Composition of Shopping Basket Dhar, Huber, and Khan (2007) propose that consumers initially approach a shopping situation with a deliberative mind-set, trying to decide what to buy. However, when they make an initial purchase, they shift to an implemental mind-set that makes them more receptive to additional, unrelated purchases. The authors term this the shopping momentum effect. An activated regulatory orientation not only guides an initial choice but also spreads to other, unrelated decisions.

12 Consumers regulatory focus interacts with the savings message frame of a sales promotion to influence overall basket size, such that those experiencing regulatory compatibility (promotion focus with gain-framed promotion; prevention focus with nonloss-framed promotion) add more items to their basket than those not experiencing such compatibility. H1 Consumers regulatory focus interacts with the expiration date restrictions on a sales promotion to influence overall basket size, such that those experiencing regulatory compatibility (promotion focus with longer horizon promotion; prevention focus with shorter horizon promotion) add more items to their basket than those not experiencing such compatibility. H2

13 Consumers regulatory focus interacts with the type of brand, such that a greater number of (a) well-known brands are chosen with a prevention focus rather than a promotion focus and (b) less familiar brands are chosen with a promotion focus rather than a prevention focus. H3 The framing of the coupon savings message interacts with the type of brand, such that a greater number of (a) wellknown brands are chosen when coupons are framed as nonlosses rather than gains and (b) less familiar brands are chosen when coupons are framed as gains rather than nonlosses. H4

14 The expiration date restriction on a sales promotion interacts with the type of brand, such that a greater number of (a) well- known brands are chosen when the coupon has an immediate expiration date rather than a longer horizon and (b) less familiar brands are chosen when the coupon has a longer time horizon rather than an immediate expiration date. H5

15 We manipulate regulatory focus and the savings message frame but hold the expiration date restrictions constant. We test the effects on both basket size and composition (well-known versus less familiar brands).

16 Participants. 116 undergraduate students (18–25 years of age; 61 male, 55 female) at the University of Chicago participated for compensation of $3 each. Participants had lived an average of 18.4 years in the United States, and their average monthly grocery bill was $36.

17 Procedure. 2 (regulatory focus: promotion versus prevention) × 2 (savings message frame: nonloss versus gain) × 2 (brand: well-known versus less familiar) mixed factorial design, with type of brand as a repeated measure.

18 Save $1.50 Get $1.50 off on any 3-pack of Sparkle paper towels regular price $3.00 on any 3-pack of Sparkle paper towels regular price $3.00

19 Testing of the manipulation of regulatory focus and message frame as independent sources of regulatory orientation. Eight words pertained to ideals and 8 to oughts, 16 were neutral in content, and 32 were not words.

20 Activation of regulatory orientation. MANOVA The results showed significant main effects for regulatory focus and the savings message. The interaction between the regulatory focus and savings message frame was not significant. Univariate tests Facilitation scores for ideal-related words were higher when participants had a promotion focus and when the coupon was gain framed. Facilitation scores for ought-related words were higher when participants had a prevention focus and when the coupon was nonloss framed.

21 Negative binomial regression on the number of well-known brands chosen showed a significant, positive effect of facilitation scores (logarithmically transformed) for ought-related words and a significant, negative effect for ideal-related words. on the number of less familiar brands participants chose showed a significant, positive effect of the logarithmically transformed facilitation scores for ideal-related words. However, the effect of facilitation scores for ought-related words was not significant.

22 Pretest to determine whether type of brand purchased acts as a regulatory cue. How similar it was to what they normally purchased How much they would consider the brand a safe choice prevention focus How novel the brand would be compared with what they normally purchased How much the brand would satisfy a need for variety for that participant. promotion focus

23 Omnibus test showed a significant effect of the type of brand Univariate tests less familiar brands were rated higher on the promotion focus dimension well-known brands were rated higher on the prevention focus dimension

24 Size and composition of basket. H1 Interaction between regulatory focus and message frame

25 interaction between regulatory focus and type of brand H3a & H3b

26 interaction between message frame and type of brand H4a & H4b

27 Promotion focus, gain-framed coupons, and less familiar brands are all associated with increased facilitation for ideal-related words. Prevention focus, nonloss-framed coupons, and well-known brands are all associated with increased facilitation for ought-related words.

28 First, we use a BOGO instead of a discount offer. Second, we manipulate the temporal restriction for the offer, which expires either the same day or in two weeks. Third, we measure it using a chronic accessibility paradigm( ). Fourth, to test the findings generality, the promotion features a well-known brand, Bounty paper towels, rather than a less familiar one.

29 Participants 95 undergraduate students (18–29 years of age; 44 male, 51 female) at the University of Chicago participated in this computer-mediated study in exchange for compensation of $3. On average, participants spent $37 monthly on groceries.

30 Procedure we first informed participants that they would be completing a questionnaire on their self-concepts as consumers. Participants received descriptions of ideal and ought selves and listed up to six attributes they would ideally like to possess or ought to possess. To simplify the exposition, we computed a regulatory strength score by subtracting response times for ideals from those for oughts. Positive values on this measure indicated a high promotion focus and negative ones a high prevention focus.

31 Buy One, Get One Free any one 3-roll package of Bounty paper towels Buy One, Get One Free any one 3-roll package of Bounty paper towels Regular price ($3) :6/8 :6/22

32 Manipulation check A one-factor MANOVA on present and future orientation showed a significant effect of type of restriction. Participants who saw the today frame were more likely to believe that the advertisement made them think of things they planned to do today than those who saw the 2 weeks frame. A MANOVA of gain and nonloss conditions showed a significant effect of type of restriction. Participants who saw the 2 weeks frame reported that the advertisement made them think of getting a good deal, more so than those who saw the today frame.

33 Size and composition of basket H5a & H5b

34 H2

35 H3b

36 prevention-focused participants led to greater goal compatibility with time-restricted offers, resulting in more unpromoted items in the basket. The increased choice of well-known brands drove this effect. promotions with a longer time horizon led to increased sales of unpromoted items. However, unlike the effects for prevention-focused participants, the increased choice of less familiar, rather than well-known brands.

37 First, we use a coupon handed out at the store entrance. Second, instead of promoting a specific brand, we offer a generic discount on the total basket, as long as the amount exceeds a specific limit. Finally, we use a different manipulation of regulatory focus, in view of obvious difficulties of getting customers to write essays or measuring their response times in a real-world setting.

38 Participants 212 participants conducting their normal shopping at a neighborhood grocery store were given an opportunity to earn a discount of $5 on their purchases in the store. 123 of these participants redeemed the coupon.

39 Procedure As shoppers entered the store, they were met by a research assistant, who was blind to the purpose of the study, and greeted with one of two scripts. Each coupon was framed as either Save $3 on any purchase over $10 or Get $3 off any purchase over $10. We manipulated the coupon expiration date restriction cue as Offer expires today or Offer valid all week

40 Size of basket We used a generalized linear negative binomial model with a log link to estimate the effects of the three factors and their interactions. These results were qualified by three significant two-way interactions.

41 Interaction between regulatory focus and the coupon savings message frame. Participants in the prevention focus condition added more items to their baskets when they received a coupon framed as Save $x (nonloss). Participants in the promotion focus condition added more items to their baskets when they received the Get $x Off coupon. in support of H1.

42 Interaction between regulatory focus and the expiration date. Participants in the promotion focus condition added more items to their basket when they received a coupon with a longer expiration date. Participants in the prevention focus condition added more items when they received a coupon that expired the same day in support of H2.

43 Interaction between the savings message frame and expiration date restriction of the coupon. Participants who received the Get $x Off coupon added more items to their baskets when the coupon had a longer time horizon. We found no difference in the number of items added with the Save $x coupon for the immediate expiration date versus the longer time horizon.

44 The framing of the savings message and expiration date restrictions of the coupon not only helped accentuate or attenuate the effects of the regulatory orientation shoppers might bring into the store but also acted as independent sources of a regulatory orientation and primed behaviors consistent with a promotion or prevention focus.

45 These cues not only serve to reinforce or attenuate shoppers promotion or prevention foci but also act independently of such regulatory foci to guide behavior. Shoppers experiencing compatibility between a cue and their regulatory orientation or among multiple cues are likely to add more unpromoted items to their baskets.

46 we examine the effects of sales promotions on the size and composition of the market basket and thus take a retailers rather than a manufacturers perspective. our research highlights the importance of the consumers orientation (promotion versus prevention) as an influence on individual differences in their responsiveness to promotions. our research focuses on two important design variables for promotions.


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