Are “buy X get X free” price promotions effective? An acquisition-transaction value perspective

Purpose: “Buy X Get X Free” promotions are popular across retail settings. Retailers promote a variety of products using this promotional frame. However, past research contains mixed findings about the effectiveness of this promotion compared to the straightforward discount on a single unit of a product. The goal of this research is to employ a theoretical lens to examine the effectiveness of “Buy X Get X Free” promotions.

Design/methodology/approach: The theoretical framework was tested in two experiments using different products and samples. The data collected from each experiment were analyzed using both descriptive and inferential techniques to assess support for the theoretical arguments.

Findings: Findings reveal that at identical levels of per-unit discount, the “Buy X Get X Free” promotion is perceived less favorably by consumers than a straightforward single-unit discount. Consumers perceive lower transaction value and acquisition value and, thereby, a lower purchase intention, from the “Buy X Get X Free” promotion compared to a single-unit discount.

Practical implications: This research was conducted keeping in mind the popularity of the “Buy X Get X Free” promotion in the real world. The findings caution retailers against indiscriminately using this promotional frame.

Originality/value: Using a theoretical lens, this research proposes and validates a framework to systematically examine consumers' perceptions of the two popular discount frames. The proposed theoretical framework provides a richer understanding of the underlying consumer psychology that drives the evaluation of these promotions. Further, primary data from lab experiments validates the framework. The research also helps advance the understanding of consumer evaluation of sales promotions in general.

The version of record is available at https://doi.org/10.1108/MIP-03-2023-0118. The full citation is as follows: [Are “buy X get X free” price promotions effective? An acquisition-transaction value perspective. Marketing Intelligence & Planning 41, 6 p707-721 (2023)]. This author accepted manuscript is deposited under a Creative Commons Attribution Non-commercial 4.0 International (CC BY-NC) licence. This means that anyone may distribute, adapt, and build upon the work for non-commercial purposes, subject to full attribution. If you wish to use this manuscript for commercial purposes, please contact permissions@emerald.com

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Work Title Are “buy X get X free” price promotions effective? An acquisition-transaction value perspective
Access
Open Access
Creators
  1. Siddharth Harshkant Bhatt
  2. Dinesh Ramdas Pai
Keyword
  1. Buy get free
  2. Free products
  3. Point of sale promotions
  4. Multiunit price promotions
  5. Discounts
License CC BY-NC 4.0 (Attribution-NonCommercial)
Work Type Article
Publisher
  1. Marketing Intelligence and Planning
Publication Date July 20, 2023
Publisher Identifier (DOI)
  1. https://doi.org/10.1108/MIP-03-2023-0118
Deposited March 07, 2024

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Version 1
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  • Created
  • Added Author_Accepted_Manuscript_Are__Buy_X_Get_X_Free__Price_Promotions_Effective_-_An_Acquisition-Transaction_Value-1.PDF
  • Added Creator Siddharth Harshkant Bhatt
  • Added Creator Dinesh Ramdas Pai
  • Published
  • Updated Keyword, Description, Publication Date Show Changes
    Keyword
    • Buy get free, Free products, Point of sale promotions, Multiunit price promotions, Discounts
    Description
    • Purpose: “Buy X Get X Free” promotions are popular across retail settings. Retailers promote a variety of products using this promotional frame. However, past research contains mixed findings about the effectiveness of this promotion compared to the straightforward discount on a single unit of a product. The goal of this research is to employ a theoretical lens to examine the effectiveness of “Buy X Get X Free” promotions. Design/methodology/approach: The theoretical framework was tested in two experiments using different products and samples. The data collected from each experiment were analyzed using both descriptive and inferential techniques to assess support for the theoretical arguments. Findings: Findings reveal that at identical levels of per-unit discount, the “Buy X Get X Free” promotion is perceived less favorably by consumers than a straightforward single-unit discount. Consumers perceive lower transaction value and acquisition value and, thereby, a lower purchase intention, from the “Buy X Get X Free” promotion compared to a single-unit discount. Practical implications: This research was conducted keeping in mind the popularity of the “Buy X Get X Free” promotion in the real world. The findings caution retailers against indiscriminately using this promotional frame. Originality/value: Using a theoretical lens, this research proposes and validates a framework to systematically examine consumers' perceptions of the two popular discount frames. The proposed theoretical framework provides a richer understanding of the underlying consumer psychology that drives the evaluation of these promotions. Further, primary data from lab experiments validates the framework. The research also helps advance the understanding of consumer evaluation of sales promotions in general.
    • Purpose: “Buy X Get X Free” promotions are popular across retail settings. Retailers promote a variety of products using this promotional frame. However, past research contains mixed findings about the effectiveness of this promotion compared to the straightforward discount on a single unit of a product. The goal of this research is to employ a theoretical lens to examine the effectiveness of “Buy X Get X Free” promotions.
    • Design/methodology/approach: The theoretical framework was tested in two experiments using different products and samples. The data collected from each experiment were analyzed using both descriptive and inferential techniques to assess support for the theoretical arguments.
    • Findings: Findings reveal that at identical levels of per-unit discount, the “Buy X Get X Free” promotion is perceived less favorably by consumers than a straightforward single-unit discount. Consumers perceive lower transaction value and acquisition value and, thereby, a lower purchase intention, from the “Buy X Get X Free” promotion compared to a single-unit discount.
    • Practical implications: This research was conducted keeping in mind the popularity of the “Buy X Get X Free” promotion in the real world. The findings caution retailers against indiscriminately using this promotional frame.
    • Originality/value: Using a theoretical lens, this research proposes and validates a framework to systematically examine consumers' perceptions of the two popular discount frames. The proposed theoretical framework provides a richer understanding of the underlying consumer psychology that drives the evaluation of these promotions. Further, primary data from lab experiments validates the framework. The research also helps advance the understanding of consumer evaluation of sales promotions in general.
    Publication Date
    • 2023-08-23
    • 2023-07-20
  • Updated