Taking a chance for a discount: An investigation into consumers’ choice of probabilistic vs. sure price promotions

This research investigates consumers’ preference for probabilistic versus sure price promotions across two frames and different probability values. In three experiments, the authors show that the choice propensity for a probabilistic discount is higher when a reduced price as opposed to an amount of discount frame is used. Moreover, the choice propensity for a probabilistic discount (as opposed to an equivalent sure discount) decreases as probability values increase. The authors discuss the theoretical and managerial implications of the research findings as well as directions for future research.