What Makes Deal-of-The-Day Promotions Really Effective? The Interplay of Discount and Time Constraint with Product Type

摘要: Deal-of-the-day (DoD) promotions are nowadays very popular. As a special form of price promotion, they allow firms to offer products at substantial discounts, usually or above 50%, for limited period time, between one and seven days. Conventional wisdom suggests that both characteristics, high discount levels tight time constraints, should make DoDs an effective promotion. However, the two characteristics do not necessarily combine increase DoD effectiveness. In particular, authors propose depending on type promoted product (utilitarian vs. hedonic), attention consumers pay level relative constraint varies, which leads differences in promotional Two studies, lab experiment field study using data from platform Groupon, mostly confirm these hypotheses: increases effectiveness more hedonic than utilitarian products, whereas products. Groupon data, actually decrease The results suggest designers consider when choosing appropriate constraints levels.