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The double benefits of consumer certainty: combining risk and range effects

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The double benefits of consumer certainty: combining risk and range effects. / Maier, Erik; Wilken, Robert; Dost, Florian.
In: Marketing Letters, Vol. 26, No. 4, 12.2015, p. 473-488.

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Maier E, Wilken R, Dost F. The double benefits of consumer certainty: combining risk and range effects. Marketing Letters. 2015 Dec;26(4):473-488. Epub 2014 Feb 13. doi: 10.1007/s11002-014-9282-5

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Maier, Erik ; Wilken, Robert ; Dost, Florian. / The double benefits of consumer certainty : combining risk and range effects. In: Marketing Letters. 2015 ; Vol. 26, No. 4. pp. 473-488.

Bibtex

@article{0b47f8a3a8b74ca0872eb27fd45aef78,
title = "The double benefits of consumer certainty: combining risk and range effects",
abstract = "We investigate consumer certainty as an important dimension of attitude strength and explore its influence on willingness to pay (WTP) ranges. WTP ranges are defined by two thresholds (floor/minimum and ceiling/maximum reservation price); their difference indicates the degree of (un)certainty. Across five studies (online, laboratory, and field experiments plus a field survey) with more than 25,000 participants, we find that increased consumer certainty generates an asymmetric shift in the WTP thresholds, such that the floor price increases more strongly than the ceiling price, which also implies a reduction in the WTP range. Consequently, this research specifies predictions offered by choice models that use Bayesian learning. The asymmetric effects appear, irrespective of the source of uncertainty, so our study advances understanding of whether consumers differ in their behavior as a consequence of preference or product performance uncertainty.",
keywords = "Certainty, Uncertainty , Risk premium, Risk effect, Range effect , Willingness to pay as a range ",
author = "Erik Maier and Robert Wilken and Florian Dost",
year = "2015",
month = dec,
doi = "10.1007/s11002-014-9282-5",
language = "English",
volume = "26",
pages = "473--488",
journal = "Marketing Letters",
issn = "0923-0645",
publisher = "Springer New York",
number = "4",

}

RIS

TY - JOUR

T1 - The double benefits of consumer certainty

T2 - combining risk and range effects

AU - Maier, Erik

AU - Wilken, Robert

AU - Dost, Florian

PY - 2015/12

Y1 - 2015/12

N2 - We investigate consumer certainty as an important dimension of attitude strength and explore its influence on willingness to pay (WTP) ranges. WTP ranges are defined by two thresholds (floor/minimum and ceiling/maximum reservation price); their difference indicates the degree of (un)certainty. Across five studies (online, laboratory, and field experiments plus a field survey) with more than 25,000 participants, we find that increased consumer certainty generates an asymmetric shift in the WTP thresholds, such that the floor price increases more strongly than the ceiling price, which also implies a reduction in the WTP range. Consequently, this research specifies predictions offered by choice models that use Bayesian learning. The asymmetric effects appear, irrespective of the source of uncertainty, so our study advances understanding of whether consumers differ in their behavior as a consequence of preference or product performance uncertainty.

AB - We investigate consumer certainty as an important dimension of attitude strength and explore its influence on willingness to pay (WTP) ranges. WTP ranges are defined by two thresholds (floor/minimum and ceiling/maximum reservation price); their difference indicates the degree of (un)certainty. Across five studies (online, laboratory, and field experiments plus a field survey) with more than 25,000 participants, we find that increased consumer certainty generates an asymmetric shift in the WTP thresholds, such that the floor price increases more strongly than the ceiling price, which also implies a reduction in the WTP range. Consequently, this research specifies predictions offered by choice models that use Bayesian learning. The asymmetric effects appear, irrespective of the source of uncertainty, so our study advances understanding of whether consumers differ in their behavior as a consequence of preference or product performance uncertainty.

KW - Certainty

KW - Uncertainty

KW - Risk premium

KW - Risk effect

KW - Range effect

KW - Willingness to pay as a range

U2 - 10.1007/s11002-014-9282-5

DO - 10.1007/s11002-014-9282-5

M3 - Journal article

VL - 26

SP - 473

EP - 488

JO - Marketing Letters

JF - Marketing Letters

SN - 0923-0645

IS - 4

ER -