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Measuring reference price perceptions for new product categories: which measure is best?

Lowe, Ben, Alpert, Frank (2007) Measuring reference price perceptions for new product categories: which measure is best? Journal of Product and Brand Management, 16 (2). pp. 132-141. ISSN 1061-0421. (doi:10.1108/10610420710740007) (KAR id:3129)

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Official URL:
http://dx.doi.org/10.1108/10610420710740007

Abstract

Purpose – The purpose of this paper is to provide guidance within the reference price literature by investigating which is the best measure of reference

price for the, as yet, unstudied context of new product categories. The paper also intends to examine another reference price issue for the new product

category context: whether greater price uncertainty in this context makes it worthwhile to measure consumer confidence in reference price perceptions.

Design/methodology/approach – This research uses the experimental method to determine which measures of reference price are best suited to the

new product context, by removing all other confounding influences.

Findings – The findings confirm that consumers tend to evoke the fair price concept for new product categories and the expected price concept for

existing categories. The paper also finds that confidence in reference price measures, while theoretically useful, does not add to the understanding of

reference price effects in new product categories, probably because respondents tended to be overly confident in their perceptions, despite lacking in

more objective measures of product category knowledge.

Originality/value – Several studies in the literature have commented on the issue of fragmented measurement in the reference price domain. Some

studies have offered theoretical guidance on measures to use. This is the first study to provide empirically tested theory on which measures to use and is

the first study to examine reference price effects in new product categories including testing the usefulness of the confidence measure.

Item Type: Article
DOI/Identification number: 10.1108/10610420710740007
Uncontrolled keywords: Prices, Perception, New products
Subjects: H Social Sciences > HF Commerce
H Social Sciences > HB Economic Theory
Divisions: Divisions > Kent Business School - Division > Department of Marketing, Entrepreneurship and International Business
Depositing User: Benjamin Lowe
Date Deposited: 14 May 2008 07:10 UTC
Last Modified: 16 Nov 2021 09:41 UTC
Resource URI: https://kar.kent.ac.uk/id/eprint/3129 (The current URI for this page, for reference purposes)
Lowe, Ben: https://orcid.org/0000-0002-5041-600X
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