The Analysis Of Durable Goods' Reference Price Formation

Although a potential customer may favor some products or brands, prices are likely to make him or her hesitate. This may be because the product pricing is too high, or because the price promotion of the product or brand does not reach to the extent of others. Not only will consumers respond to the absolute prices of commodities, but also on the price perception. One important basis of consumers' price perception is consumers'reference price. Reference price is the price which consumers use to compare to the prices offered by the vendors. Winer, a well-known scholar, first found the phenomenon of reference price in 1986 in indirect means. After that, many studies have also demonstrated the existence of reference price. In the marketing academia and other related fields, scholars have aroused much attention to the study of reference price.After reviewing the research literature of previous scholars, the author found that the majority of scholars'research focused on daily consumer packaged goods and less focused on durable goods. After a comprehensive analysis of previous researches, Lowengart proposed that the most urgent area of reference price research is the reference price research of durable goods in 2002. Therefore, this study selected the reference price of the durable goods as the research topic.The essay can be divided into three parts. The first is mainly literature review. First of all, this article summarizes the literature on reference price definition; secondly, this article summarizes the reference price of its manifestations; third, the author summarizes the relevant basic theory:adaptation-level theory, assimilation contrast theory, expectations theory and the scope theory. The second part is the hypothesis and research model. Based on the previous studies, the author put forward seven research hypothesis and research model. The third part is data analysis and conclusion. The study selects the household electrical appliances as the study object and collects data by the form of questionnaire. The questionnaire reliability and validity are tested. Model fit is tested in Amos 18. Path analysis showed that six out of seven standardized path coefficients are significant, that is, six hypotheses are confirmed.Through data analysis and model fit tests, this paper obtained the following findings:(1).household income will have an impact on the formation of durable goods'reference price. (2).the price information of similar goods will have an impact on the formation of durable goods'reference price. (3).the price information of other consumers has no impact on the formation of durable goods' reference price. (4).the memorized price information will have an impact on the formation of durable goods'reference price.This study has the following limitation:(1) Subjects of investigation does not cover all consumer groups. (2). household electrical appliances are focused on, none of other industries included. (3).The measurement methods may be the big defect.