Restrictively Framed Promotions Hurt Retailers: The Role of Promotion Induced Reactance

AbstractRetailers offer many in-store promotions to increase sales. In-store price promotions, and especially, multiunit discounts, are common across retail settings. The purpose of this research is to propose and test the impact of a prevalent, but unexamined, multiunit promotional frame (discount with "must buy X") on consumers' perceptions of value and purchase intention. We argue that a promotional frame that explicitly mandates the minimum purchase quantity that consumers need to buy to avail of the promotion is perceived unfavorably by consumers. As an alternative to this restrictive promotional frame, we propose the economically equivalent but differently framed promotion (discount with "bundle of X"). Our findings show that, compared to the restrictively framed promotion ("must buy"), a promotion framed as a "bundle" leads to lower promotion-induced reactance, and thereby, higher perceived value, and higher purchase intention. We discuss the theoretical and managerial implications of these findings.Keywords: Point of sale promotionspricingconsumer reactanceperceived valueframingdiscounts Disclosure statementNo potential conflict of interest was reported by the author(s).