The Effects of Price-Comparison Advertising on Buyers’ Perceptions of Acquisition Value, Transaction Value, and Behavioral Intentions

TLDR

The study extends price‑perceived value models by integrating advertised selling and reference prices into a conceptual framework that links these prices to buyers’ internal reference prices, quality perceptions, acquisition and transaction values, and purchase and search intentions. Two experimental studies were conducted to test this conceptual model. Results show that advertised selling and reference prices, along with quality perceptions, shape internal reference prices; the influence of selling price on acquisition value is mediated by transaction value, and transaction value’s effect on behavioral intentions is mediated by acquisition value, supporting the model and offering managerial implications.

Abstract

The authors expand and integrate prior price-perceived value models within the context of price comparison advertising. More specifically, the conceptual model explicates the effects of advertised selling and reference prices on buyers’ internal reference prices, perceptions of quality, acquisition value, transaction value, and purchase and search intentions. Two experimental studies test the conceptual model. The results across these two studies, both individually and combined, support the hypothesis that buyers’ internal reference prices are influenced by both advertised selling and reference prices as well as the buyers’ perception of the product's quality. The authors also find that the effect of advertised selling price on buyers’ acquisition value was mediated by their perceptions of transaction value. In addition, the effects of perceived transaction value on buyers’ behavioral intentions were mediated by their acquisition value perceptions. The authors suggest directions for further research and implications for managers.