How to attract customers by giving them the short end of the stick

Several influential streams of research in marketing, psychology, and economics conclude that when an offer a seller makes to a buyer is held fixed, the buyer will be repelled if he or she learns that some other group of buyers is getting a better price for the same benefits or receiving more benefits for the same price. Prior work has attributed this repulsion to perceptions that the offer is inequitable, that it fits others better, or that it suggests that the core product is of low value. In six experiments, the authors show conditions under which exactly the opposite can occur; that is, consumers judge the same offer to be more attractive when a seller offers a better price or more benefits to another group than when the seller treats everyone equally. © 2007, American Marketing Association.

Duke Scholars

Author Richard Staelin Fuqua School of Business