The effects of competitive context on consumer response to price changes

Steven Dunn, John Dawes, Svetlana Bogomolova

Research output: Contribution to journalArticlepeer-review

3 Citations (Scopus)

Abstract

This paper aims to understand how a brand’s price level, relative to its competitors, will affect consumers’ responses to price changes of the brand. The study uses experiments to examine brand choice responses to price increases and decreases across contexts differing in competitor brands and their respective prices. These experiments are conducted with six consumer goods categories. The research identifies three key factors that affect the size of responses to brand price changes–(1) passing a competitor brand’s price, (2) narrowing versus widening the price gaps with competitors, and (3) whether competitors are predominantly higher or lower priced brands.

Original languageEnglish
Pages (from-to)608-632
Number of pages25
JournalJournal of Marketing Management
Volume36
Issue number7-8
DOIs
Publication statusPublished - Jun 2020
Externally publishedYes

Keywords

  • Brand price elasticity
  • competitive context
  • cross-price elasticity
  • experimentation
  • pricing

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