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How Does Decoy Pricing Affect Purchasing Decisions?

Author

Listed:
  • KUBÍČKOVÁ Lea

    (Mendel University in Brno, Czech Republic)

  • VESELÁ Lucie

    (Mendel University in Brno, Czech Republic)

  • KORMAŇÁKOVÁ Marcela

    (Mendel University in Brno, Czech Republic)

  • VEVERKOVÁ Ekaterina

    (Mendel University in Brno, Czech Republic)

Abstract

This paper is devoted to the cognitive biases of decoy pricing, which has become the subject of interest of retail companies in recent years. The paper analyses the principles of the decoy effect with regard to consumer behaviour in the Czech Republic (which represents customers of the Eastern Europe). The analytical part of the paper focuses on examination of often irrational consumer decision-making process, with respect to age, gender, product group, and other factors. A combination of questionnaire survey (N=200) and interviews (N=32) was used. The results indicate a significant influence of the generation the consumer belongs to, further differences in decision-making according to gender, as well as differences in effects in various product categories. The findings may be utilised by companies considering the use of decoy pricing strategies in the Czech market.

Suggested Citation

  • KUBÍČKOVÁ Lea & VESELÁ Lucie & KORMAŇÁKOVÁ Marcela & VEVERKOVÁ Ekaterina, 2023. "How Does Decoy Pricing Affect Purchasing Decisions?," Studies in Business and Economics, Lucian Blaga University of Sibiu, Faculty of Economic Sciences, vol. 18(3), pages 176-197, December.
    • Handle: RePEc:blg:journl:v:18:y:2023:i:3:p:176-197
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    References listed on IDEAS

    as
    1. Bettman, James R & Luce, Mary Frances & Payne, John W, 1998. "Constructive Consumer Choice Processes," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 25(3), pages 187-217, December.
    2. Catherine Cole & Gilles Laurent & Aimee Drolet & Jane Ebert & Angela Gutchess & Raphaëlle Lambert-Pandraud & Etienne Mullet & Michael Norton & Ellen Peters, 2008. "Decision making and brand choice by older consumers," Marketing Letters, Springer, vol. 19(3), pages 355-365, December.
    3. Huber, Joel & Payne, John W & Puto, Christopher, 1982. "Adding Asymmetrically Dominated Alternatives: Violations of Regularity and the Similarity Hypothesis," Journal of Consumer Research, Journal of Consumer Research Inc., vol. 9(1), pages 90-98, June.
    4. repec:cup:judgdm:v:8:y:2013:i:2:p:136-149 is not listed on IDEAS
    5. Kaisa Herne, 1999. "The Effects of Decoy Gambles on Individual Choice," Experimental Economics, Springer;Economic Science Association, vol. 2(1), pages 31-40, August.
    Full references (including those not matched with items on IDEAS)

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