Price-Matching Guarantees and Consumer Evaluations of Price Information

Journal of Consumer Psychology, Vol. 15, April 2005

10 Pages Posted: 20 May 2007

See all articles by Nicholas H. Lurie

Nicholas H. Lurie

University of Connecticut School of Business

Joydeep Srivastava

University of Maryland - Robert H. Smith School of Business

Abstract

In 3 experiments, we show that price-matching guarantees affect the process through which consumers translate price information into subjective judgments. In Experiment 1, we find that price-matching guarantees appear to change the standard used in price evaluation by raising consumers' estimates of the lowest and average prices in the market. This leads consumers to perceive products and stores that offer price-matching guarantees as less expensive. In Experiment 2, we show that evaluations of product price information are affected by the presence of a price-matching guarantee only when consumers do not know the range of market prices. In Experiment 3, we extend these findings to show that consumer evaluations of the cost of products in a store, inferred on the basis of store characteristics, are also influenced by the presence of a price-matching guarantee.

Keywords: Price-matching guarantees, Pricing, Consumer inferences, Price perceptions, Retail tactics

Suggested Citation

Lurie, Nicholas H. and Srivastava, Joydeep, Price-Matching Guarantees and Consumer Evaluations of Price Information. Journal of Consumer Psychology, Vol. 15, April 2005, Available at SSRN: https://ssrn.com/abstract=987356

Nicholas H. Lurie (Contact Author)

University of Connecticut School of Business ( email )

Storrs, CT CT - Connecticut 06269
United States

HOME PAGE: http://www.business.uconn.edu/person/nicholas-lurie/

Joydeep Srivastava

University of Maryland - Robert H. Smith School of Business ( email )

College Park, MD 20742-1815
United States