Promote the price promotion

Hui‐Chun Huang · Ya-Ting Chang · Che-Yi Yeh · Chung-Wei Liao

81 citations0/0 files storedInternational Journal of Contemporary Hospitality Management

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Consumer Market Behavior and Pricing Customer Service Quality and Loyalty Consumer Retail Behavior Studies

Abstract

Purpose – The authors empirically evaluated the effect of price promotions on customer quality evaluations and repeat-purchase intentions in coffee chain stores. The moderating role of customer characteristics in this process was also investigated. Design/methodology/approach – Consumers in 12 coffee chain stores were surveyed and 488 usable questionnaires were obtained. Relationships in the test model were examined using structural equation modeling techniques. A multiple-group solution was used to test the moderating effects of consumer characteristics. Findings – The results of structural equation modeling analyses suggested that price-promotion activities at Starbucks in Taiwan had a favorable effect on customer quality evaluations and positively influenced repeat-purchase intentions. The moderating effects of consumer characteristics were partially supported. Whereas sex showed no significant moderating effect, consumption frequency did demonstrate a moderating effect. Practical implications – The results indicate that existing customers may see price promotions at Starbucks in Taiwan as a reward or incentive, and thus lead to an increase in favorable evaluations. The findings provide a new perspective that may encourage those involved in the marketing of coffee chain stores to manage price promotions in a more strategic manner by considering customer characteristics. Originality/value – The effects of price promotions on brand evaluation remain controversial and may vary among product categories. Additionally, most studies regarding price promotions have used an experimental approach, and few studies of price promotions in the coffee industry have been reported. The study is among the first to empirically examine the effects of price promotions and the moderating role of consumer characteristics in the process at coffee chain stores.

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References

1981Evaluating Structural Equation Models with Unobservable Variables and Measurement Error 1988Structural equation modeling in practice: A review and recommended two-step approach.1988On the Evaluation of Structural Equation Models 1988SERVQUAL: A multiple-Item Scale for measuring consumer perceptions of service quality 1984A Service Quality Model and its Marketing Implications 1995A step-by-step approach to using the SAS system for factor analysis and structural equation modeling 1990Consumer perceptions of service quality: an assessment of the SERVQUAL dimensions 2001Satisfaction, Repurchase Intent, and Repurchase Behavior: Investigating the Moderating Effect of Customer Characteristics

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