The Framing Effect of Coupon Value For New Products

This paper examines the effect of different discount formats on coupon value for new products. The result shows that frames of coupon value moderates the relationship among coupon value, perceived price and purchase intention. For existing products,two discount formats have no significant difference on the perceived price of low-level products. But for high-level products, there is significant difference on the perceived price between the two discount formats, and the cents-off coupons are more suitable for high-level products, which bring about higher redemption rate. However, the percentage-off coupon is more suitable for physical products and services. For new products, the framing effect is more significant. The percentage-off is more suitable for low-level new products. In cases of the percentage-off, higher coupon value is regarded as wider markdown amplitude, thus leading to stronger purchase intention. However, for high-level new products, the high perceived price of the cents-off will enhance consumers’ purchase intention instead. For new services, the purchase intention with the percentage-off will be stronger. Our study is of significant value of reference to guidance in the practice of business management.

Citation:

Zhe Zhang, Qianrong Fang, and MIngxia Zhao (2011) ,"The Framing Effect of Coupon Value For New Products", in AP - Asia-Pacific Advances in Consumer Research Volume 9, eds. Zhihong Yi, Jing Jian Xiao, and June Cotte and Linda Price, Duluth, MN : Association for Consumer Research, Pages: 234-235.