The role of mood in price promotions

Authors: Hsu, Chung-kue; Liu, Ben Shaw-Ching

Source: Journal of Product and Brand Management, Volume 7, Number 2, 1998 , pp. 150-160(11)

Publisher: Emerald Group Publishing Limited

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Abstract:

This paper deals with the issue of mood effects on perceived transaction value in the context of price promotions. Specifically, mood states appear to bias evaluation and judgments in mood congruent direction. Based on Grewal et al.'s model and mood congruent effects, we propose that when encountering price promotions, buyers in a positive mood, as opposed to buyers in a negative mood, will perceive a greater transaction value. Moreover, we hypothesize that the effect of advertised selling price on perceived transaction value is likely to be moderated by buyers' mood states. Our results support these hypotheses. In addition, we also find asymmetric moderating effects on discount levels in positive mood state vs. in negative mood state. Managerial implications and future research directions are also discussed.

Keywords: Advertising; Consumer Behaviour; Evaluation; Price Discounts; Pricing; Sales Promotion

Document Type: Research article

DOI: 10.1108/10610429810216928

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