Article2004

Free Gift with Purchase: Promoting or Discounting the Brand?

183 citations0/0 files storedJournal of Consumer Psychology

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Consumer Market Behavior and Pricing Consumer Behavior in Brand Consumption and Identification Consumer Retail Behavior Studies

Abstract

Two experiments examine the process by which free gift promotions serve as a source of information about the underlying value of the product offered as a free gift. The value-discounting hypothesis argues that by virtue of being offered as a free gift, products will be valued less as evinced by lower purchase intentions and a lower price that consumers are willing to pay for them. Conditions that inhibit the value-discounting effect include the (a) presence of alternate price information to make judgments about the value of the gift, and (b) contextual information about the value of the promoted brand.

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References

2000No Pain, No Gain: A Critical Review of the Literature on Signaling Unobservable Product Quality 1999Signaling Unobservable Product Quality through a Brand Ally 1990Sales Promotion: Concepts, Methods and Strategies 1990Promotion Signal: Proxy for a Price Cut?1997Framing the Deal: The Role of Restrictions in Accentuating Deal Value 1999When Do Price Promotions Affect Pretrial Brand Evaluations?1994Experimental Evidence on the Negative Effect of Product Features and Sales Promotions on Brand Choice

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