Numerous and complicated forms of discounts are becoming ubiquitous in promotion activities. Compared to a single discount, multiple discounts refer to a promotion package with more than three discounts, for example, Harris Teeter, an American supermarket chain, provides triple coupons; Double Eleven Shopping Carnival in China adopted multiple discounts for several years, e.g.,“￥100 off”, “￥20 coupon” and “Additional ￥5 off”. Researchers have noticed the impact of double discounts on consumer judgment, attitude and decisions, but the impact of prevalent multiple discounts have not been explored. Calculating multiple discounts brings high cognitive load for consumers and ruins the enjoyable shopping experiences with exhausting math problems. The lowered cognitive fluency deteriorates sellers’ images. Consumers infer the sincerity of sellers through their experienced consistency of sellers’ promotion slogans and actions. We propose that, multiple discounts decrease consumers’ cognitive fluency, then reduce their perceived sincerity of sellers, thus attenuating consumers’ willingness to purchase. Based on the numerical cognition, we conduct 4 studies to explore the effect of multiple discounts. Study 1A and 1B find that consumers prefer a single discount to multiple discounts, no matter how much the discount offered. Study 2 examines the chained mediation effect of cognitive fluency and perceived sincerity on the impact of multiple discounts on consumer purchasing intentions. Study 3 finds that consumers’ concern for sales moderates the effect. Specifically, consumers with less concern for sales do not have significantly different preferences for those two discounts, whereas consumers with higher concern for sales prefer single discount. Study 4 introduces post-discount-price presentation as a moderator. The results show that when providing post-discount-price, the effect of multiple discounts disappears, but if sellers do not provide the final price, the effect remains significant. Additionally, alternative explanations such as discount depth, perceived quality, familiarity and emotions have been excluded. This research contributes to the discounting format and numerical cognition literature. First, we distinguish and compare the impacts of the multiple discount promotion and the single discount promotion on consumer decisions. Second, through the mediation analysis, we explore how the promotion design impacts the whole process of consumer cognitive processing, attitude formation and purchase decisions. From a managerial perspective, this research offers theoretical guidance and feasible tactics to help marketers to design and present discounts. First, sellers should choose single discount rather than multiple discounts when setting up the promotion design. Second, online recommendation systems can profile consumers’ concern for sale, then push multiple discount activities to consumers with high concern for sales. Third, when sellers have to choose multiple discounts to cooperate with platforms, directly presenting final price helps to lessen the negative effect of multiple discounts.
A Discount Added Is an Obstacle Created: The Impact of Multiple Discounts on Consumer Decisions
Foreign Economics & Management Vol. 42, Issue 12, pp. 56 - 71 (2020) DOI:10.16538/j.cnki.fem.20200904.301
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Cite this article
Wang Xin, Xiao Chunqu, Zhu Hong. A Discount Added Is an Obstacle Created: The Impact of Multiple Discounts on Consumer Decisions[J]. Foreign Economics & Management, 2020, 42(12): 56-71.