Effect of Price‐discount Distribution in Multi‐unit Price Promotions on Consumers' Willingness to Pay, Sales Value, and Retailers' Revenue. Issue 1 (11th April 2014)

• Record Type: Journal Article
• Authors: Akaichi, Faical; Nayga, Rodolfo M.; Gil, José M.
• Is Part Of: Agribusiness. Volume 31:Issue 1(2015)
• Page Start: 14
• Page End: 32
• Publication Date: 2014-04-11
• Subjects: Agriculture -- Economic aspects -- Periodicals; Agriculture -- Finance -- Periodicals; Agricultural industries -- Periodicals; Agriculture -- Economic aspects -- United States -- Periodicals; Agriculture -- United States -- Finance -- Periodicals; Agricultural industries -- United States -- Periodicals; 338.1
• DOI: 10.1002/agr.21389
• Languages: English
• ISSNs: 0742-4477

Abstract

<abstract abstract-type="main"> <title>ABSTRACT</title> <p>Using multi‐unit auctions, we examined the effect of different distributions of price discount across multiple units of a relatively new product on consumers' Willingness to Pay (WTP), sales value and retailers' revenue. We found that allowing the price discount to be increasing in the number of units increases willingness to pay, sales value and retailers' revenue and that a price discount that is uniformly distributed across units also has the potential to motivate consumers to buy more units of the product. However, multi‐unit price promotions that concentrate all the amount of price discount on the last unit only generate a weak positive effect on sales value. [EconLit Citations: C910, D120, M310].</p> </abstract>