There is nothing permanent except change - analyzing individual price dynamics in "pay-what-you-want" situations

Edinger-Schons, Laura Marie ; Rese, Mario ; Wieseke, Jan ; Rasmussen, Wiebke ; Weber, Daniel ; Strotmann, Wolf-Christian

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Document Type: Article
Year of publication: 2014
The title of a journal, publication series: Marketing Letters
Volume: 25
Issue number: 1
Page range: 25-36
Place of publication: Dordrecht [u.a.]
Publishing house: Springer
ISSN: 0923-0645 , 1573-059X
Publication language: English
Institution: Business School > Sustainable Business (Edinger-Schons 2015-2022)
Subject: 650 Management
Keywords (English): Participative pricing; Pay what you want; Long-term price dynamics; Reference prices; Latent growth modeling.
Abstract: This study is examines the dynamics in prices paid in “pay-what-you-want” situations over multiple customer–seller transactions on an individual customer level. The analysis of potential dynamism in prices paid allows for an assessment of the profitability of pay-what-you-want pricing for sellers of frequently bought products and services. To empirically validate the framework, the authors conduct a field study that focuses on the aggregate and individual dynamics in prices paid over customers’ multiple purchases. Using latent growth modeling, the authors find significant but declining decreases in prices paid. Further, they identify stable individual and relational difference factors which predict steeper or more gradual declines in prices paid. Customers’ individual preferences for fairness and price consciousness as well as their overall satisfaction with the seller alleviate price declines. The authors discuss the practical and theoretical implications of these findings.

Dieser Datensatz wurde nicht während einer Tätigkeit an der Universität Mannheim veröffentlicht, dies ist eine Externe Publikation.

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