Format effects in volume discounts to consumers

Abstract

Purpose Using a classification of benefits and costs of promotional offers along three routes – economic, informational and affective – this paper aims at evaluating, from the consumer's point of view, the relative perceptual disadvantages of separate‐item bundles compared to pre‐wrapped bundles. Design/methodology/approach The marketing literature and a qualitative study based on 18 consumers permits the identification of the relative perceived costs and benefits associated with separate‐item bundles and for hypotheses to be derived. An experiment on a sample of 120 adult consumers was then set up to test these hypotheses. Findings The findings suggest that consumers associate separate‐item bundles with higher economic benefit but also with higher inspection costs. From a more global perspective, there is no loss of interest in separate‐item bundles compared to pre‐wrapped bundles. Research limitations/implications Focusing the research on separate‐item bundles clarifies the way consumers evaluate promotions. Its qualitative phase gives support to the relevance of an “informational route”, beyond the traditional utilitarian and hedonic routes. Its quantitative phase confirms the importance of cognitive biases in consumers' perceptions of promotions. Practical implications The numerous advantages of separate‐item bundles for manufacturers and retailers and their attraction to consumers should lead to an increasingly intensive use in promotional campaigns. Besides, the quality of in‐store communication is the most important factor of the success of separate‐item bundles, which provides the opportunity to propose meaningful recommendations for practitioners. Originality/value If the strengths and weaknesses of separate‐item bundles have already been studied from a managerial point of view, to the authors' knowledge, no research has focused on separate‐item bundle efficiency from the consumer's point of view.