Is $0 Better than Free? Consumer Response to "$0" versus "Free" Framing of a Free Promotion
- Authors
- Koo, Jieun; Suk, Kwanho
- Issue Date
- 9월-2020
- Publisher
- ELSEVIER SCIENCE INC
- Keywords
- Attentional shift; Framing; Free promotion; Loss aversion; Pricing
- Citation
- JOURNAL OF RETAILING, v.96, no.3, pp.383 - 396
- Indexed
- SSCI
SCOPUS
- Journal Title
- JOURNAL OF RETAILING
- Volume
- 96
- Number
- 3
- Start Page
- 383
- End Page
- 396
- URI
- https://scholar.korea.ac.kr/handle/2021.sw.korea/53643
- DOI
- 10.1016/j.jretai.2019.11.006
- ISSN
- 0022-4359
- Abstract
- This research explores the framing effect of free promotions on consumer responses. Specifically, the same free promotion can be presented as "free" (e.g., "Get Product X for Free") or "$0" (e.g., "Get Product X for $0"). This study examines whether such presentations affect consumer preference for promotions. Results of ten experiments, including a field study, demonstrate that a free promotion is evaluated more favorably when presented as "$0" than "free." This framing effect occurs because of the differential focus on the benefits of free promotions. The "$0" frame leads consumers to focus more on the cost-saving benefit of a free promotion, whereby people perceive that they save the entire cost of a free offer because of the promotion. By contrast, the "free" frame leads consumers to focus on obtaining a free offer itself. Thus, people perceive that the benefit of a promotion is the certain gain of the free offer. Given that the value associated with avoiding loss (i.e., cost) is greater than the value of an equivalent gain, $0 promotions are evaluated more favorably. (C) 2019 New York University. Published by Elsevier Inc. All rights reserved.
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Collections - Korea University Business School > Department of Business Administration > 1. Journal Articles
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