Effects of brand quality on consumers’ willingness to pay: a behavioural-economic discounting framework.
Supervisor: Professor Gordon Foxall, Cardiff University.
Consultant co-researchers: Professor Jorge M. Oliveira-Castro, University of Brasilia. Professor Rafael Barreiros Porto, School of Business, University of Brasilia.
When choosing among different brands (products/services) with varying quality levels offered at different prices, consumers face alternatives that vary on two dimensions. This choice context contains similarities to situations of intertemporal choices or temporal discounting, where the person must choose between obtaining a smaller reward sooner or a larger reward later. In such temporal choices, the value of a reward (i.e., subjective value) decreases as a function of increases in the delay to receive it, which has been described in the literature as delay discounting.
The parallel between intertemporal choices and quality-price choices is drawn on the assumption that both can be characterized as bidimensional choices, where increases in the magnitude of a reward (i.e., reinforcing consequence) is correlated to increases in cost (i.e., punishing consequences). Intertemporal choices typically offer larger rewards (i.e., increased reinforcer magnitude) associated to larger delays (i.e., increased punishment), whereas quality-price choices present higher-quality products or services (i.e., increased reinforcer magnitude) associated to higher prices (i.e., increased punishment).
The main purpose of the present research is to examine the relation between product quality and price, within a behavioural-economic discounting framework. Two studies will be conducted to investigate the effects of changes in product quality upon the price consumers pay (Study 1, using consumer panel data) or are willing to pay (Study 2, using questionnaire with consumer purchase tasks). The level of quality of products will be conceptualize according to a model of consumer behaviour, which interprets “quality” of a product as the level of reinforcement it offers consumers. The level of reinforcement can be measured by quantifying contingencies programmed by marketing managers or a social group.
Previous experience in
- Quantitative Research
- behavioural economics, psychology, quantitative research methods
- knowledge of SPSS or similar
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