Devon DelVecchio

The Asymmetric Effects of Extending Brands to Lower and Higher Quality

Managers often extend brands to different quality levels (e.g., Charmins lower-quality Charmin Basic), which may increase sales but risks diluting brand image. This study examines such line extensions by testing middle-quality brands (e.g., Giovannis pasta sauce [fictitious], Fosters beer [real]) that offer higher-quality (e.g., Giovannis Magnifico) or lower-quality line extensions (e.g., Fosters Grog). A robust asymmetry emerges in which higher-quality extensions improve brand evaluation far more than lower-quality extensions damage it. The asymmetry prevails across various perceptual and evaluative dimensions, multiple product classes, numerous fictitious and real brands that differ on various dimensions (familiarity, liking, personality, and prestige), and consumer regulatory focus. Group and individual-level tests show that the standard asymmetry is the modal pattern (though not universal) and that it is associated with two primary underlying processes: (1) opponent processes produced by lower-quality extensions whose negative quality-association effects are tempered by positive variety effects (in general, consumers prefer broader product lines) and (2) best-of-brand processing, in which consumers consider higher-quality extensions more relevant to brand evaluation than lower-quality extensions.

The effects of lower prices on perceptions of brand quality: a choice task perspective

Purpose – The purpose of this paper is to investigate whether the negative effect of lower prices on perceived brand quality that has been demonstrated in evaluation tasks arises in a brand choice context.Design/methodology/approach – The effects of lower prices on perceived quality are assessed via two laboratory experiments in which college students participated.Findings – A lower price is associated with lower perceived brand quality in Study 1s evaluation task environment. However, Study 2s results indicate a reversal of the negative effects of lower prices on perceived brand quality in an evaluation task to generally positive effects when the lower price is offered in the form of a discount in a choice task.Practical implications – In addition to providing evidence that fears of the detrimental effects of lower prices may be overblown, the results also provide insight to managers of brands of different levels of quality on how to manage discounts to build, or at least to insulate, perceptions of th...

Mode matters: an exemplar‐prototype hybrid (EPH) model of reference price formation

Purpose – This research aims to integrate two theories of reference price formation and to test the resulting exemplar‐prototype hybrid (EPH) models predictions. Study 1 tests the predictions of the EPH model regarding price attractiveness ratings. Study 2 helps to document the process by which the EPH model operates.Design/methodology/approach – The investigation consists of a pair of laboratory experiments that manipulate the skew (positive, negative) of historic price data, and the frequency of the modal price (high, low) in the price history.Findings – Both the skew of prices to which consumers are exposed and the frequency with which the modal price occurs affect recall of the modal price and evaluations of the attractiveness of subsequent prices.Research limitations/implications – Consumers rely on information about both the price range and individual price points to form reference prices. Common models of reference price effects may be improved by including a non‐linear estimate of the effect of m...

‘Meaningful marketing’: A process investigation of how consumers reward noninterruptive, nonpersuasive marketing communication

In this research, we investigate brand benevolence, brand trust, and indebtedness toward the brand arising out of noninterruptive, nonpersuasive marketing communication that provides utility to the consumer independent of consumption of the brands product or service [defined as meaningful marketing (MM)]. Through three experiments, two using a real website of a popular brand and one using a fake recruitment site, we show that MM increases purchase intentions through the mediating influence of perceived benevolence. The influence of perceived benevolence on purchase intentions is, in turn, mediated by indebtedness and brand trust. Further, consumers reward MM even if it directly promotes the brand. Suggestions for future research and limitations are discussed.

When signal swamps substance: the effects of multi-unit discount’s positive and negative cues on sales

Purpose Multi-unit discounts (MUDs, e.g. “3 for

The effect of sales promotion on post-promotion brand preference: A meta-analysis

4”) typically increase sales relative to other discounting frames. This study demonstrates the value of MUDs by showing that positive multi-unit price/quantity signals are potent enough to match and even exceed the sales produced by larger discounts on single items. However, there is reason to believe that MUDs can produce neutral effects in some cases (e.g. among consumers interested in only single-unit purchases) and even negative effects in others. In addition, the study considers whether MUDs can, in some cases, reduce purchase quantities by signaling smaller-than-otherwise-planned purchase amounts and/or lower-quality products. Design/methodology/approach The effectiveness of MUDs is tested in both the field and lab. Study 1 models purchase quantities stemming from 2,374 purchases of discounted items at a mass retailer. Purchased products ranged in type from pantry items to apparel and electronics, and ranged in price from 44¢ to

Cents or Percent? The Effects of Promotion Framing on Price Expectations and Choice

99.99. There were 1,530 single-unit discounts, 596 two-unit discounts and 248 discounts, involving three or more units. Study 2 consists of a laboratory experiment that overcomes the shortcomings of Study 1 by accounting for non-purchasers, controlling for product classes and testing whether smaller MUDs can lead to lower purchase quantities for larger-purchase-quantity products. Findings The results of both the field study and the laboratory experiment indicate that MUDs’ monetary cue (savings) and purchase-quantity cue (volume) increase purchase quantities. Generally, purchase quantities increased monotonically with the number of units offered in the discount. In fact, the quantity cue is so effective that it can increase sales enough as to substitute for larger discounts. However, in some instances, MUDs can decrease intended purchase quantities. The negative effect of MUDs is the most pronounced for larger unit deals, offering deeper discounts on perishable goods. Originality/value This research is the first to demonstrate that the power of the signals provided by MUDs may be so positive as to lead them to be more effective than discounts of substantially larger value but also so negative as to render them less effective than single-units discounts. This negative outcome poses a threat beyond those typically associated with discounts, in that rather than consumers simply discounting a discount, in which case the discount remains positive even if their impact at the margin wanes, the MUD frame may actually reduce sales.