Featured Research

from universities, journals, and other organizations

When do consumers think a freebie is more valuable than a discounted product?

Date:
August 20, 2013
Source:
Journal of Consumer Research, Inc.
Summary:
Consumers may value a free gift more than a deeply discounted promotional item, especially if it comes from a prestigious brand.

Consumers may value a free gift more than a deeply discounted promotional item, especially if it comes from a prestigious brand, according to a new study in the Journal of Consumer Research.

Related Articles


"Since consumers believe the value of a free product is likely to be consistent with the value of the purchased product, pairing a free product with a high-end product may very well increase perceptions of its value," write authors Mauricio M. Palmeira (Monash University) and Joydeep Srivastava (University of Maryland).

These days, companies often offer bonus products for free or at a low discounted price with a required purchase. For example, high-end cosmetics companies like Lancτme or Clinique offer free gifts with the purchase of a full-priced product.

In one study, participants were offered a free or discounted package of spaghetti with the purchase of a jar of organic tomato sauce for $8.95. They were then asked how much they would pay for the spaghetti individually. People offered free spaghetti were willing to pay an average of $2.95 for it, but those offered the spaghetti for $.50 were only willing to pay an average of $1.83.

When a free product is paired with an expensive product, consumers assume it is worth more than if it was offered at a low discounted price. For example, if a luxury jeweler offers a free bottle of wine with a purchase, consumers assume it isn't cheap. But, according to the authors, customers might assume the same wine is cheaper if the jeweler offers it for $1.

"Promotions with low discounted prices devalue products more than free offers. In fact, free offers may not devalue products at all when they are paired with an expensive purchase, as consumers will use the price of the focal product to estimate the value of the supplementary product," the authors conclude. "If Mercedes-Benz promotes a car with a free GPS system, we expect the GPS to be high quality," the authors explain.


Story Source:

The above story is based on materials provided by Journal of Consumer Research, Inc.. Note: Materials may be edited for content and length.


Journal Reference:

  1. Mauricio M. Palmeira and Joydeep Srivastava. Free Offer ≠ Cheap Product: A Selective Accessibility Account on the Valuation of Free Offers. Journal of Consumer Research, December 2013

Cite This Page:

Journal of Consumer Research, Inc.. "When do consumers think a freebie is more valuable than a discounted product?." ScienceDaily. ScienceDaily, 20 August 2013. <www.sciencedaily.com/releases/2013/08/130820113920.htm>.
Journal of Consumer Research, Inc.. (2013, August 20). When do consumers think a freebie is more valuable than a discounted product?. ScienceDaily. Retrieved December 18, 2014 from www.sciencedaily.com/releases/2013/08/130820113920.htm
Journal of Consumer Research, Inc.. "When do consumers think a freebie is more valuable than a discounted product?." ScienceDaily. www.sciencedaily.com/releases/2013/08/130820113920.htm (accessed December 18, 2014).

Share This


More From ScienceDaily



More Mind & Brain News

Thursday, December 18, 2014

Featured Research

from universities, journals, and other organizations


Featured Videos

from AP, Reuters, AFP, and other news services

Yoga Could Be As Beneficial For The Heart As Walking, Biking

Yoga Could Be As Beneficial For The Heart As Walking, Biking

Newsy (Dec. 17, 2014) — Yoga can help your weight, blood pressure, cholesterol and heart just as much as biking and walking does, a new study suggests. Video provided by Newsy
Powered by NewsLook.com
1st Responders Trained for Autism Sensitivity

1st Responders Trained for Autism Sensitivity

AP (Dec. 16, 2014) — More departments are ordering their first responders to sit in on training sessions that focus on how to more effectively interact with those with autism spectrum disorder (Dec. 16) Video provided by AP
Powered by NewsLook.com
Guys Are Idiots, According To Sarcastic Study

Guys Are Idiots, According To Sarcastic Study

Newsy (Dec. 12, 2014) — A study out of Britain suggest men are more idiotic than women based on the rate of accidental deaths and other factors. Video provided by Newsy
Powered by NewsLook.com
Believing in Father Christmas Good for Children's Imaginations

Believing in Father Christmas Good for Children's Imaginations

AFP (Dec. 12, 2014) — As the countdown to Christmas gets underway, so too does the Father Christmas conspiracy. But psychologists say that telling our children about Santa, flying reindeer and elves is good for their imaginations. Duration: 01:57 Video provided by AFP
Powered by NewsLook.com

Search ScienceDaily

Number of stories in archives: 140,361

Find with keyword(s):
 
Enter a keyword or phrase to search ScienceDaily for related topics and research stories.

Save/Print:
Share:  

Breaking News:

Strange & Offbeat Stories

 

Health & Medicine

Mind & Brain

Living & Well

In Other News

... from NewsDaily.com

Science News

Health News

Environment News

Technology News



Save/Print:
Share:  

Free Subscriptions


Get the latest science news with ScienceDaily's free email newsletters, updated daily and weekly. Or view hourly updated newsfeeds in your RSS reader:

Get Social & Mobile


Keep up to date with the latest news from ScienceDaily via social networks and mobile apps:

Have Feedback?


Tell us what you think of ScienceDaily -- we welcome both positive and negative comments. Have any problems using the site? Questions?
Mobile iPhone Android Web
Follow Facebook Twitter Google+
Subscribe RSS Feeds Email Newsletters
Latest Headlines Health & Medicine Mind & Brain Space & Time Matter & Energy Computers & Math Plants & Animals Earth & Climate Fossils & Ruins