Article: Implications of Autonomous Pricing on Persuasive Knowledge and Aggressive Consumers Journal: Journal of Business and Management (JBM) 2021 Vol.27 No.2 pp.33 - 68 Abstract: Purpose - This research contributes to the participative pricing literature by examining how consumers with varying levels of persuasion knowledge and aggressiveness respond to different levels of autonomy in the price-setting process. Persuasion knowledge is the ability to interpret, evaluate, and respond to influence attempts from advertisers and salespeople. Method - An experimental design was utilized to expose consumers to either a pay-what-you-want price or fixed-price scenario. After reading a scenario about their products and pricing, consumers were asked to rate their purchase likelihood and perceived satisfaction levels of a fictitious pizza store. Participants then responded to questions measuring their persuasion knowledge and aggressiveness. Findings - Pricing autonomy, persuasion knowledge, and aggressiveness influence purchase likelihood and perceived satisfaction. As consumers' persuasion knowledge increases, their purchase intentions under a pay-what-you-want price are higher than under a fixed price. Conversely, when persuasion knowledge is low, or aggressiveness is high, there is no difference in purchase intentions under the two pricing scenarios. Limitations - A fictitious scenario was presented to the participants. Future studies could replicate this study with the subjects of actual retailers. A field experiment could be conducted more closely to simulate the actual exchange process. Lastly, continuous variables (persuasion knowledge and aggressiveness) were dichotomized in this study. Although there is support for using this method, future studies could manipulate these variables to gain more confidence in our findings by replicating the research design. Implications - The findings support that consumers prefer to have autonomy in the price-setting process. Therefore, marketing managers can benefit their business through pay-what-you-want pricing. Therefore, participative pricing could get consumers to try products for the first time and result in future purchases at fixed prices. With a more complex customer loyalty program, managers can target specific customers for promotions. Moreover, this study provides support for marketing managers to target specific customers when pay-what-you-want pricing is offered. Specifically, those customers with high persuasion knowledge respond favorably. Consumers with low aggression respond significantly more favorably when given more autonomy in the price-setting process. Originality - These findings contribute to our understanding of participative pricing, where consumers can set the price of products. It gives managers more confidence in implementing elective pricing in their business models and provides insights into which consumers respond most favorably when using this pricing mechanism as a short-term promotion or long-term pricing strategy. Inderscience Publishers - linking academia, business and industry through research

Title: Implications of Autonomous Pricing on Persuasive Knowledge and Aggressive Consumers

Authors: James Blair

Addresses: Author address listing can be found in the "About the Authors" section at the end of the article.

Abstract: Purpose - This research contributes to the participative pricing literature by examining how consumers with varying levels of persuasion knowledge and aggressiveness respond to different levels of autonomy in the price-setting process. Persuasion knowledge is the ability to interpret, evaluate, and respond to influence attempts from advertisers and salespeople. Method - An experimental design was utilized to expose consumers to either a pay-what-you-want price or fixed-price scenario. After reading a scenario about their products and pricing, consumers were asked to rate their purchase likelihood and perceived satisfaction levels of a fictitious pizza store. Participants then responded to questions measuring their persuasion knowledge and aggressiveness. Findings - Pricing autonomy, persuasion knowledge, and aggressiveness influence purchase likelihood and perceived satisfaction. As consumers' persuasion knowledge increases, their purchase intentions under a pay-what-you-want price are higher than under a fixed price. Conversely, when persuasion knowledge is low, or aggressiveness is high, there is no difference in purchase intentions under the two pricing scenarios. Limitations - A fictitious scenario was presented to the participants. Future studies could replicate this study with the subjects of actual retailers. A field experiment could be conducted more closely to simulate the actual exchange process. Lastly, continuous variables (persuasion knowledge and aggressiveness) were dichotomized in this study. Although there is support for using this method, future studies could manipulate these variables to gain more confidence in our findings by replicating the research design. Implications - The findings support that consumers prefer to have autonomy in the price-setting process. Therefore, marketing managers can benefit their business through pay-what-you-want pricing. Therefore, participative pricing could get consumers to try products for the first time and result in future purchases at fixed prices. With a more complex customer loyalty program, managers can target specific customers for promotions. Moreover, this study provides support for marketing managers to target specific customers when pay-what-you-want pricing is offered. Specifically, those customers with high persuasion knowledge respond favorably. Consumers with low aggression respond significantly more favorably when given more autonomy in the price-setting process. Originality - These findings contribute to our understanding of participative pricing, where consumers can set the price of products. It gives managers more confidence in implementing elective pricing in their business models and provides insights into which consumers respond most favorably when using this pricing mechanism as a short-term promotion or long-term pricing strategy.

Keywords: Pay-what-you-want pricing; autonomy; persuasion knowledge; aggression; purchase intentions.

DOI: 10.1504/JBM.2021.141290

Journal of Business and Management, 2021 Vol.27 No.2, pp.33 - 68

Published online: 05 Sep 2024 *

Title: Implications of Autonomous Pricing on Persuasive Knowledge and Aggressive Consumers

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