Moderating effects of sales promotion types.
| Autor | de Oliveira Santini, Fernando |
| Cargo | Report |
Introduction
Despite being widely used in the management sphere (Bertrand, 1998; Wierenga & Soethoudt, 2010), sales promotion has scarcely been explored in the academic field (Alvarez & Casielles, 2005; D'Astous & Landreville, 2003). In the business context, Silva (n.d.) indicated that $176 billion would be invested in such initiatives by the end of 2013, representing an increase of 33% in relation to 2011. Recently, the same organization projected investments of $24 billion in sales promotion activities only on social networks for 2015 (Paglia, 2010). This projection exceeds the forecast that advertisement will have investments of $14 billion. In the academic sphere, some gaps can be observed in the literature, especially regarding the analysis of moderators that may either enhance or minimize the impact of sales promotion on consumer behavior (Alvarez & Casielles, 2005; Freo, 2005; Low & Mohr, 2000). Therefore, inquiry into how sales promotion type results in different consumer responses becomes essential (Chandon, Wansink, & Laurent, 2000; Kwok & Uncles, 2005; Taylor & Neslin, 2005).
Aiming to reduce the aforementioned gap in the literature, this study proposes to examine the moderating effect of sales promotion type (monetary vs. non-monetary) on the relationship between perceived consumption value (hedonic and utilitarian), perceived financial risk and purchase intentions for a promoted product. To this end, an experimental study was conducted involving 589 consumers who were exposed to either monetary or non-monetary product sales promotions.
This study is expected to contribute to the literature in the following ways: (a) to stimulate discussion of the topic with a view of the scarce literature on the subject (Alvarez & Casielles, 2005; D'Astous & Landreville, 2003); (b) to deepen understanding of non-monetary sales promotion techniques, as they have been unsuccessful in relation to monetary promotions (Ailawadi, Beauchamp, Donthu, Gauri, & Shankar, 2009; Pacheco & Rahman, 2015; Reid, Thompson, Mavondo, & Brunso, 2015); (c) to provide knowledge about consumer responses to two different sales promotion techniques (Ailawadi et al., 2009; Chandon et al., 2000; Kwok & Uncles, 2005; Taylor & Neslin, 2005); (d) to provide a better understanding of the relationship between sales promotion and purchase intention based on the inclusion of moderators (Chandon et al., 2000; Kwok & Uncles, 2005; Taylor & Neslin, 2005); and (e) to expand on the research of Chandon, Wansink and Laurent (2000) by including an independent variable (risk perception).
This study is structured as follows: the article proceeds by presenting the literature review and hypotheses in the next section. The subsequent section describes the methods used, followed by an analysis of the results and final considerations.
Literature Review and Working Hypotheses
Sales promotions are divided into two types: monetary promotions and non-monetary promotions. Monetary promotions are considered the best alternative for short-term increased sales, and these promotions play a key role in consumer choices (Alvarez & Casielles, 2005). This assumption is reinforced by Blattberg and Neslin (1990), who argued that this promotion type satisfies consumers' desire for savings. Studies such as those of Davis, Inman and McAlister (1992) and Taylor and Neslin (2005) indicated that consumers always respond to monetary promotion campaigns, as this promotion type is based on a transactional incentive, which provides immediate rewards and utilitarian benefits (Chandon et al., 2000; Kwok & Uncles, 2005).
The benefits of non-monetary promotions are not always related to short-term increased sales (Nbudisi & Moi, 2005). These promotions, such as loyalty programs and prize contests, are related to entertainment and other actions that aim for long-term effects, such as brand strengthening (Chandon et al., 2000; Kwok & Uncles, 2005).
In general, sales promotions techniques, regardless of their type (monetary or non-monetary), constitute significant variables that influence consumers' purchase intentions. Lee (2002), for ins tance, found that sales promotions are more effective than advertising in reaching company sales objectives. Nevertheless, studies conducted in the 1970s, such as Cotton and Babb (1978), and more recent studies such as Alvarez and Casielles (2005) have demonstrated the effectiveness of both monetary and nonmonetary sales promotions in consumers' responses and attitudes. For this reason, the following hypothesis is proposed:
H1: Sales promotions positively influence consumers' purchase intentions.
In relation to the effects of promotions on consumers' purchase intentions, the effect of monetary campaigns are believed to be even stronger. This assumption is made based on the results of studies such as Lee (2002), who found that sales campaigns focused on savings (monetary promotions) performed better than non-monetary promotions and that monetary promotions are preferred by consumers over non-monetary promotional actions. Gilbert and Jackaria (2002) found that discount promotions (monetary) have a greater influence on purchase decisions than do non-monetary promotions (e. g., prize contests). More recently, Nusair, Y oon, Naipaul and Parsa (2010) similarly found that discount promotions (monetary) were more effective than prize campaigns (non-monetary) when the purpose is to influence service acquisition. Given the above findings, the following hypothesis will be tested in this study:
H2: The effect of monetary sales promotions on consumers' purchase intentions is stronger than that of non-monetary sales promotions.
Another assumption of the present research is that the type of sales promotion (monetary or nonmonetary) influences the perceived value of the product offered.
Individuals' motivation for consumption is generally connected with their attitudes toward brands and their utilitarian and/or hedonic nature (Crowley, Spangenberg, & Hughes, 1992; Voss, Spangenberg, & Grohmann, 2003). This fact is also considered in studies of sales promotions (Chandon et al., 2000; Kwok & Uncles, 2005; Park & Mowen, 2007; Shukla & Babin, 2013). Both the works of Chandon et al. (2000) and Kwok and Uncles (2005) have linked the benefits of hedonic and utilitarian value to sales promotions types (monetary and non-monetary).
Thus, it is believed that both types of promotional campaigns (monetary and non-monetary) will affect perceived value and, as consequence, intentions to purchase a promotional product.
H3: The utilitarian perception of the product influences, in a positive way, the product's purchase intention on sales promotion.
H4: The hedonic perception of a product influences, in a positive way, the product's purchase intention on sales promotion.
According to the referenced studies, monetary sales promotions foster the perception of three utilitarian benefits--savings, increased quantity and enhanced convenience--whereas non-monetary promotions improve hedonic value perceptions--such as entertainment, exploration and opportunities for value expression. Thus, it is suggested that monetary promotions are more suitable for products or services that have a rather utilitarian nature and that non-monetary promotions are better suited for hedonic products or services (Chandon et al., 2000; Kwok & Uncles, 2005).
Purchase intentions and utility value perceptions will have a stronger relationship with consumers exposed to monetary promotions. This assumption is based on the following principles: (a) monetary promotions positively affect sensitivity to perceptions of economic benefits (Ailawadi et al., 2009; Chandon et al., 2000; Kwok & Uncles, 2005); (b) monetary promotions predict short-term effects (Alvarez & Casielles, 2005; Nusair, Yoon, Naipaul, & Parsa, 2010) associated with purchases by quantity and convenience (Laroche, Pons, Zgolli, Cervellon, & Kim, 2003), and these characteristics are directly related to the characteristics of utilitarian value (Chandon et al., 2000; Reid et al., 2015); and (c) monetary promotions induce economic behaviors (Kwok & Uncles, 2005) and consequently relegate quality perceptions to second place (Martinez & Montaner, 2006), and such perceptions are associated with hedonic value perceptions (Chandon et al., 2000). Thus, the following is hypothesized:
H5: The type of sales promotion moderates the relationship between the utilitarian value perceptions and purchase intentions for a promoted product, with the perception of utilitarian value being stronger (weaker) for monetary (non-monetary) promotions.
In the sixth hypothesis, a moderating role of the sales promotion type in the relationship between hedonic product value perceptions and purchase intentions is expected. In this case, a stronger relationship is expected for consumers exposed to non-monetary promotion. This assumption is based on the following arguments: (a) consumers who are exposed to non-monetary campaigns are less sensitive to price (Ailawadi et al., 2009); (b) non-monetary promotions are effective in evoking long-term behaviors, such as those related to brand image (Aaker, 1991; Esteban-Bravo, Mugica, & Vidal-Sanz, 2009; Gupta, 1988); (c) non-monetary promotions stimulate exploration perceptions, self-expression and entertainment (Schindler, 1989), which are related to hedonic value perceptions (Chandon et al., 2000; Kwok & Uncles, 2005); and (d) non-monetary promotions are aligned with experiential purchase orientations, as demonstrated in the results of the recent research (Buttner, Florack, & Goritz, 2015). Based on these arguments, the following hypothesis is proposed:
H6: The type of sales promotion moderates the relationship between the hedonic value perceptions and purchase intentions for a promoted product, with hedonic value perceptions being stronger (weaker) for non-monetary (monetary) promotions.
Perceived risk has been proven to be an important...
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