Going it alone or together: the role of space between products on consumer perceptions of price promotions

Abstract

This research demonstrates that the existence (vs. nonexistence) of space between products on a retail shelf has a significant impact on the effectiveness of multiple vs. single unit price promotions. In particular, we establish the novel relationships between space and consumers’ distinctiveness motivations. As a result, we demonstrate that the existence of space reduces the effectiveness of multiple (vs. single) unit price promotions. We further uncover the relationships between no space and consumers’ relational thinking and show that no space enhances the effectiveness of multiple (vs. single) unit price promotions on consumer purchase intentions. Furthermore, we demonstrate important boundary conditions of the core interactive effect between space and multiple (vs. single) unit price promotions. That is, building on the notion that product variety decreases consumers’ distinctiveness motivations, we show that in the space context, the negative effect of multiple (vs. single) unit price promotion on purchase intentions is attenuated by product variety. We also demonstrate that product popularity diminishes the positive impact of no space on the effectiveness of multiple (vs. single) unit price promotion on purchase intentions.