Buyer Shopping Costs and Retail Pricing: An Indirect Empirical Test

Topics:
Pricing and Margins,
Pricing Strategy
Tags:
Discount,
Internet-Journals,
Marketing,
Marketing Research,
Pricing,
Pricing Strategy
Source:
Internet-Journals

Vendor Registration: required

Overview: Suppose that consumers incur fixed shopping costs and choose stores according to advertised discounts. Then, the extent to which a store will discount advertised items should increase with the profit from other regularly-priced items. Bookstores customarily advertise discounts on bestsellers. 9.5 (? 2.2) higher bestseller percentage discounts. This paper presents the results of a study that indirectly confirm that booksellers discount bestsellers to attract consumers, and that consumers bear significant fixed shopping costs.

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Format: PDF | Size: 234KB | Date: Apr 2005 | Pages: 22

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