Meaningless Differentiation and Purchase Incidence

Consumers often turn down a good purchase opportunity just because they were unable to take advantage of an even better opportunity in the past. This decision-avoidance tendency, termed inaction inertia, suppresses the likelihood that customers will avail themselves of a price discount that is good in an absolute sense but not as good as the one foregone. In this paper, we show that even a trivial differentiation between the current and the foregone products may be sufficient to mitigate inaction inertia caused by unfavorable price discrepancy and restore purchase likelihood. The results from a series of studies show that an addition of a trivial attribute to the current product reduces regret, suppresses inaction inertia, and restores the likelihood of purchase when there is a large unfavorable difference between the current discounted price of a product and its foregone lower price. The results provide a rationale for how trivial attributes can be used in conjunction with price changes to control inaction inertia and maintain purchase likelihood.

Citation:

Piyush Kumar (2006) ,"Meaningless Differentiation and Purchase Incidence", in AP - Asia-Pacific Advances in Consumer Research Volume 7, eds. Margaret Craig Lees, Teresa Davis, and Gary Gregory, Sydney, Australia : Association for Consumer Research, Pages: 162-163.