Disrespectful Promotions: The Negative Impact of Price Promotions on Products Symbolically Linked to Stigmatized Identities

Abstract

To reach a more diverse consumer base, companies have begun to offer products symbolically linked to stigmatized identities, and these products are often promoted by price discounts. Despite past work finding that linking consumer identities to products is generally appealing and that price promotions benefit consumers, the current research finds that offering discounts on products symbolically linked to stigmatized identities may backfire. Across eight studies, which include a variety of stigmatized groups in U.S. society, we find that when a company offers a discount on a product symbolically linked to a stigmatized identity, members of the stigmatized group react negatively toward the company (i.e., they hold less favorable attitudes, have lower purchase intentions, and choose the company's competitor). These negative reactions, which do not arise for nonstigmatized consumers, occur because stigmatized consumers perceive the company's action of offering a discount as disrespectful toward their social group. The effect is contingent on whether the company is an ingroup or outgroup member, the selection of other discounted products, and the type of sales promotions employed. This research enriches our understanding of stigmatized consumers and offers insights into the nature of disrespectful cues in the marketplace and the social cost of price promotions.