Research Upon Effects Toward Attraction Effect&Compromise Effect Via Introducing Brand Reference Point

In the daily life, when the consumers face the production set with more than one product, the probability of one product’s choice is often dependent on the relative position of the product in the production set(Novemsky.2007), and cause the attraction effect and compromise effect. Due to the great theoretical and practical significance of attract effect and compromise effect,therefore these two effects become the focus of academia and enterprise practice management.At the same time, in the decision-making process,the consumers are not dependent on all kinds of existing information of the products,but use one or a few real reference point as the basis for decision-making.And the consumers will use the comparison of the interests and the reference point as the decision results. But the previous research of these two effects always focused on the single reference point,and these research didn’t accord with the real situations.Through the literature review and the previous interview,the author found that the brand as an important factor affect the consumers’behavior in many ways,but the literature often use the brand as a constant.Therefore, on the basis of the previous research,this study introduce the brand information into these two effects for the first time,and form the double reference points scene by the product function attributes and the brand to verify that whether these two effects will still steady.At the same time,this study will explore the changes of the consumers’behavior after adding the brand informations.This paper expounds the background of this study,and make the purpose, content and significance clearly.Based on the existing research results,this paper puts forward the relative hypothesis of the attraction effect and compromise effect under the double reference point (brand property and function attributes).In the decision-making process,the consumers will often choose a reference standard as the reference, and this implicit reference basis is the "reference point".The core content of the hypothesis in this paper is that if the consumer reference point change,the consumer’s behavior will change too,and lead to the value’s change of the the attraction effect and compromise effect. The hypothesis of this paper are proved by the experiment method,and the experiment use the mixture experiments. There are a control group and a control group in each set of experiments and each group have30-50people.This paper prove the hypothesis with Stata11.0,and the results are as the follows:(1) Containing only the product function attributes (Single reference point), the attraction effect and compromise effect are still steady.These two effects will not be influenced by the national culture and the market environment;(2) Adding the brand information (Double reference points), when the target brand is better than the competition brand, the attraction effect is still strong.But the effect value did not increase due to the decline of the sensitivity.(3) Adding the brand information (Double reference points), when the target brand is better than the competition brand, the compromise effect is still strong and the effect value increase clearly. This shows that the consumers’decision mode have significant difference under the attraction effect and compromise effect.And when the temptation brand is weaker than the target brand, the compromise effect will increase.(4) Adding the brand information (Double reference points), when the target brand is weaker than the competition brand, because of the change of the reference point,the attraction effect and compromise effect will occur decreased and even the failure.Based on these results,this research puts forward the related theory value and marketing enlightenment.According to the study, this paper mainly has the following innovative points:(1) Perspective innovationThis article did research from the view of the reference point.In lots of study of the behavioral economics,the people always choose a reference standard as a reference in decision-making process.So this new perspective can reflect the consumers’decision-making behavior more real, effective and practical.(2) The brand is introduced into the research of the attraction effect and compromise effectMany scholars have done lots of research of the influence of the brand, such as the effect of the brand culture, brand image and brand emotion on consumers’ behavior. The importance of the brand to consumer decision-making and the enterprise development has been approved unanimously. But in previous experiment,the brand hasn’t been introuduced into the research as a factor,this can’t confirmed the real existence of the situation effect.Therefore based on the previous studies, this paper will introduce the brand information into research for the first time, and prove the existence and changing of the consumers’behavior.(3)Research on attraction effect and compromise effect under double-reference-point circumstanceConsumers are often impacted by various factors such as individual preference, psychological factors, external factors and so on. By taking brands as the second reference point, it would be more effective and realistic to study the consumers’ behavior. On the other hand, companies can make better long-term strategic plans as well as marketing achievements under the multi-reference-point circumstances. This study has provided evidences for bounded rationality of consumer behavior through explaining the outcomes of attraction effect and compromise effect under the double-reference-point circumstances. I’ve chosen the product’s functioning attribute and brands as the two reference points, compared the compromise effect and attraction effect under both single and double reference-point scenarios, and finally observed the different impacts on attraction effect and compromise effect with the double reference points validating or with reference point shifting.