Evaluating consumer price perception: a mental accounting and frame dependent perspective

Agbato, Oluwadamilola Motunrayo (2016) Evaluating consumer price perception: a mental accounting and frame dependent perspective. PhD thesis, University of Glasgow.

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Abstract

In this thesis, we evaluate consumer purchase behaviour from the perspective of heuristic
decision making. Heuristic decision processes are quick and easy mental shortcuts, adopted
by individuals to reduce the amount of time spent in decision making. In particular, we
examine those heuristics which are caused by framing – prospect theory and mental
accounting, and examine these within price related decision scenarios. The impact of price
framing on consumer behaviour has been studied under the broad umbrella of reference
price, which suggests that decision makers use reference points as standards of comparison
when making a purchase decision. We investigate four reference points - a retailer's past
prices, a competitor's current prices, a competitor's past prices, and consumers' expectation
of immediate future price changes, to further our understanding of the impact of price
framing on mental accounting, and in turn, contribute to the growing body of reference
price literature in Marketing research. We carry out experiments in which levels of price
frame and monetary outcomes are manipulated in repeated measures analysis of variance
(ANOVA). Our results show that where these reference points are clearly specified in
decision problems, price framing significantly affects consumers' perceptions of monetary
gains derived through discounts, and leads to reversals in consumer preferences. We also
found that monetary losses were not sensitive to price frame manipulations.

Item Type: Thesis (PhD)
Qualification Level: Doctoral
Keywords: heuristic, reference price, price framing, reference points, mental accounting, prospect theory.
Subjects: H Social Sciences > H Social Sciences (General)
Colleges/Schools: College of Social Sciences > Adam Smith Business School > Economics
Supervisor's Name: Kovalenkov, Dr. Alexander
Date of Award: 2016
Depositing User: Oluwadamilola Agbato
Unique ID: glathesis:2016-7563
Copyright: Copyright of this thesis is held by the author.
Date Deposited: 08 Sep 2016 15:35
Last Modified: 02 May 2018 16:02
URI: http://theses.gla.ac.uk/id/eprint/7563
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