Keller free gifts, sweepstakes, bonus packs, samples), whereas


Keller
defined the benefits of sales promotions as the additional value linked to the
sales promotions using experience that may consist of both promotion exposure
(e.g., recognizing a promotion) and practice (e.g., attend a sweepstake or
purchase a promoted product)1.  This definition suggests that consumers
respond to promotions due to the positive using experience or, consistent with
Holbrook’s (1994) definition, due to their customer value2.

While Diamond, Johnson and Campbell explained the extra value of sales promotions
by relating the reference price to sales promotions. According to their
studies, some promotions increase the value of the product (such as free gifts,
sweepstakes, bonus packs, samples), whereas others (such as price cut) merely
decrease the buying cost. Hence, the effect on reference price will result in
different attitudes towards sales promotions such as money savings or perceived
gain3.

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Liao
also claimed that price promotions rewards can be perceived as savings or loss
reduction. Whereas non-price promotions without relation to money (e.g., free
gifts), its benefits are hardly translated into reference price. Therefore,
this kind of promotions is framed as gain. Benefits of promotions seen as gains
are separated from the reference price, while promotions constructed as reduced
loss are considered as simply decreasing the purchase price4.

Additionally, if hedonic promotions are not related to reference prices, they
may not be seen as eroding the perception of the quality or brand equity of the
companies5.

 

According
to Simonson, Carmon, and O’Curry, a new product attribute or promotion type
could make customers go away if they perceived little value attached to the
sales promotion experience in comparison to other choices. The most common
explanation for this was the implication of additional value and the quality of
the product itself. “Customers may misunderstood that they are going to pay for
the unnecessary thing, and hence assume that they receive no value”6.

                                   

This
phenomenon could be explained by the attitude of people. When it comes to
evaluation of sales promotions benefits, customers assess three hedonic
benefits (self-expression, amusement, and exploration) and three utilitarian
benefits (savings, enhanced product quality, and improved shopping experience).

Customers sometimes find it hard to rationally assess options with unneeded
features. At this point, non-price promotions not only noticeably differ from price
promotions, but also have a greater scope of acceptability than price promotions7.

                                   

According
to the study of Lowe and Barnes in 2012, non-price promotions appeared more
appealing to customers when it came to introduction of new products as people
perceived that they offer more gains and reduce the loss for trying a new product.

Nevertheless, for the next generation products involve a high degree of
innovativeness, preference for price promotions is higher than non-price ones
due to the reduction of financial risk, thus moderate the effect of non-price
promotions8. Moreover,
Yi and Yoo discovered that non-price promotions hardly have detrimental impact
on the brand attitude9.

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