Academic journal article IUP Journal of Marketing Management

An Evaluation of Consumers' Deal-Specific Response to Sales Promotions Based on Their Product Involvement

Academic journal article IUP Journal of Marketing Management

An Evaluation of Consumers' Deal-Specific Response to Sales Promotions Based on Their Product Involvement

Article excerpt

Introduction

Consumer sales promotion (deal) is an important marketing strategy today applicable in all stages of the product life cycle, to encourage brand preference, induce brand switching and achieve brand loyalty (Prendergast et al., 2008). Deals are an important tool because the marketers are under severe pressure to achieve good bottom line results on short-term basis and sustain competitiveness (Stafford and Stafford, 2000). Other reasons include incessant clutter of advertisements and high proliferation of media costs (Shah and D'Souza, 2009). A deal is a short-term incentive that companies offer to stimulate purchase of their products (Pelsmacker et al., 2001). Rothschild and Gaidis (1981) use behavioral learning theory, specifically, Operant Conditioning theory to explain consumers' proneness to deals. According to this theory deals serve as a reward that might generate immediate consumer response (Mowen and Minor, 1998; and Schultz, et al., 1998) as they alter the price-value relationship that the products offer to the consumers (Schultz et al., 1998). It has become a common practice in India to offer deals particularly during festivities, and consumers get attracted to the various deal offers (Kumar, 2009).

Sales promotion is a powerful tool when employed appropriately and effectively; so that the deals appeal directly to the target consumers, and is perceived by them to add value. For these reasons, the study of consumers' response to deals promises to be a fruitful area with several practical implications (Raju and Hastak, 1980). Consequently, several marketing researchers have addressed issues in this area, particularly to understand the underlying motivations of deal redemption behavior and profile dealprone consumers on the basis of demographic, normative and psychographic variables. However, a majority of the earlier studies studied deals mostly offered on a single product category, mostly grocery items, and provided conclusions with the assumption that deal proneness is a generalized construct across product categories. If this assumption, that consumers who are deal-prone in a given product category will also be deal-prone in other categories, is correct, then it will be possible to predict deal proneness in a given category by using information about their responsiveness to deals in other product categories. Sales promotion campaigns could be directed at deal-prone consumers with equal effect across product categories. On the contrary, if consumers vary in their deal proneness across product categories, it may not be possible to predict a priori whether consumers found to be deal-prone in a given category will be responsive to deals in another product category (Bawa and Shoemaker, 1987). While several studies have investigated whether consumers depict similar purchase behavior across product classes (e.g., Massy et al., 1968; Blattberg et al., 1976; Ainslie and Rossi, 1998 and others), some studies have specifically examined the category specificity of deal proneness (e.g., Cunningham, 1956; Bass and Wind, 1995; Narasimhan et al., 1996; Bawa et al., 1997; and Swaminathan and Bawa, 2005). However, these studies have depicted conflicting results. Also, while earlier studies primarily focused on coupons, no earlier study involved all commonly used deals (Prendergast et al., 2008). Also, no such study, to the best of our knowledge, was done in the Indian context. To fill these gaps, this research was carried out to directly assess whether consumers are consistently dealprone when buying different product categories, i.e., a low-involvement FMCG product, e.g., shampoo, and a high-involvement durable product, e.g., apparel. The examination of the broader domain of deal types across product categories is expected to offer generalized results to some extent pertaining to consumers' deal proneness that may be useful to researchers and marketers concerned with sales promotions.

This study differs from previous sales promotion research in the following ways: (1) A majority of the earlier studies studied deals pertaining to a single product category, mostly grocery items. …

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