Research On Influence Of Purchase Restrictions Of Promotion On Consumer Responses

Sales promotion can be used by marketers to increase brand awareness, consumers’familiarity of brand, store visits, repurchase of regular customers, attract competitors’customers, and improve market share. However, sales promotion is a kind of temporary and transient activity in nature. Promotions which are too frequent, too long, or overcovered would lose its attractiveness, or even have negative impact on corporate image which made consumers consider products as cheap goods or dead stock. Only provided with a certain restriction can promotions have a positive effect on sales. For instance, time-limited promotion (e.g. for six days only) or quantity-limited promotion (e.g. first100customers only; limited edition). Promotions without purchase restriction, such as promotion price for years or promotions of high frequency, cannot improve promotion’s attraction to buyers. In terms of source, purchase restrictions can be imposed by many conditions, such as inventory limited, time or quantity limited, supply falls short of demand, high demand, low supply, identity restriction in purchase (e.g. membership only, foreign guest only), social norm (e.g. prohibition of alcohol under the age of18). The objective of this dissertation is to develop and test propositions pertaining to consumer responses of three different purchase restrictions in promotions (i.e. time-limited promotion, quantity-limited promotion, and identity restriction in promotion). The dissertation explores the relative effectiveness of different purchase restrictions in different situation, analyzes consumers’underlying psychological mechanism when they encounter purchase restrictions, and introduces relevant coping strategy for companies. The dissertation makes contributions to two research domains:firstly, it explores the research of situation suitability of purchase restrictions of promotion; secondly, it explores the disadvantaged consumers’ responses in a promotion with identity restriction (i.e. exclusive promotion).In first section, time-limited and quantity-limited promotions are contrasted in high or low perceived accessibility of purchase opportunities, and each type of promotion has its own advantages in different promotion situation. A pretest and two experiments are conducted to test a set of propositions. The objective of pretest is to confirm that two experimental conditions (the quantity constraint and the time constraint) in experiment1and2should be similar in potency. Open-ended questions are used in experiment1to explore consumers’responses to certain situation in this research with the purpose to inspect the objective existence of mediating mechanism. It is found in experiment1that consumer competition and certainty of purchase opportunity cannot be ignored in the interaction between type of purchase restrictions and perceived accessibility of purchase opportunity.Experiment2provides evidences that quantity-limited promotion is more effective than time-limited promotion in influencing consumers’purchase intentions because of consumer competition, but only when the promotion is organized in a high level of perceived accessibility of purchase opportunity. When a promotion is organized in the condition that consumers perceived the purchase opportunity in a low level of accessibility, consumers would react more positive to time-limited promotion than quantity-limited. In those situations, time-limited promotion is more effective than quantity-limited promotion because consumers perceive higher uncertainty of promotion opportunity in quantity-limited promotion. Moreover, the dissertation also discusses influences on two types of purchase restrictions of promotion by consumers’characteristics, including consumers’cognitive closure need and need for uniqueness. It is found that three-way interaction among types of purchase restrictions, perceived accessibility of purchase opportunity and consumers’ cognitive closure need affects consumers’responses. In a low level of perceived accessibility of purchase opportunity, quantity-limited promotion becomes less attractive because of uncertainty among individuals with high level of need for cognitive closure. Consumers who reports higher level of need for uniqueness prefer promotions which signals stronger scarcity. The scarcity of quantity-limited promotion stem from two sides (demand and supply), while the scarcity of time-limited promotion only stem from supply side. Therefore, quantity-limited promotion becomes more attractive to consumers with high level of need for uniqueness. In second section, the dissertation discusses key factors and mechanisms of influence process of identity restriction on disadvantaged consumers’responses in exclusive promotion. Four potential factors are explored including discount rate in exclusive promotion, difficulty to be qualified in targeted group, matching degree between target group and product, and group size of non-targeted group. Furthermore, the dissertation reveals the mechanisms of disadvantaged consumers’ responses, not only including perceived fairness of deal, but also perceived justifiability of restriction. Perceived fairness is based on social comparison which generates from comparison of input-output rate between advantaged consumers and themselves by disadvantaged consumers. The judgments of perceived justifiability of purchase restriction by disadvantaged consumers have differences depends on situations. If a promotion is perceived in a high level of justifiability, disadvantaged consumers’ potential negative responses can be reduced effectively.Based on experiment3, it is demonstrated that the increase of discount rate gives rise to unfairness perception which would negatively influence disadvantaged consumers’ preference on target product. Besides, the increase of difficulty to be qualified in targeted group would reduce disadvantaged consumers’negative responses effectively, which is mediated by perceived justifiability of purchase restriction and perceived fairness of deal sequentially. In experiment4, it reveals that matching degree between target group and product has positive effect on disadvantaged consumers’responses. The lower the matching degree between target group and product is, the more negative the disadvantaged consumers react. The influence process is mediated by perceived justifiability of purchase restriction. Experiment5provides a demonstration that group size of non-targeted group has influence on disadvantaged consumers’ responses. When non-targeted group is small-group compared to large-group, disadvantaged consumers’would be more negative in response, which is mediated by perceived justifiability of purchase restriction and perceived fairness of deal sequentially.