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Journal of Marketing Management

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Economic and utilitarian benefits of

monetary versus non-monetary in-store
sales promotions
a b b c
Mike Reid , Peter Thompson , Felix Mavondo & Karen Brunsø
a
School of Economics, Finance and Marketing, RMIT University,
Australia
b
Department of Marketing, Monash University, Australia
c
Department of Business Administration, School of Business and
Social Sciences, Aarhus University, Denmark
Published online: 30 Jul 2014.
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To cite this article: Mike Reid, Peter Thompson, Felix Mavondo & Karen Brunsø (2015) Economic
and utilitarian benefits of monetary versus non-monetary in-store sales promotions, Journal of
Marketing Management, 31:3-4, 247-268, DOI: 10.1080/0267257X.2014.939216

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 Journal of Marketing Management, 2015
Vol. 31, Nos. 3–4, 247–268, http://dx.doi.org/10.1080/0267257X.2014.939216

Economic and utilitarian benefits of monetary

versus non-monetary in-store sales promotions
Mike Reid, School of Economics, Finance and Marketing, RMIT
University, Australia
Peter Thompson, Department of Marketing, Monash University,
Australia
Felix Mavondo, Department of Marketing, Monash University,
Australia
Downloaded by [Institute of Business Admin] at 23:38 20 January 2015

Karen Brunsø, Department of Business Administration, School of

Business and Social Sciences, Aarhus University, Denmark

Abstract While prior research has examined the issue of sales promotion
proneness, very little has examined proneness to non-monetary promotions,
such as contests and premiums discovered in store. This study draws on a
promotions benefits framework to examine the influence of shoppers’ desired
benefits on their relative proneness to in-store monetary and non-monetary
promotions. Computer-aided telephone interviewing (CATI) data gathered from
500 grocery shoppers are used. The findings show that shoppers who are prone
to using non-monetary in-store promotions seek exploration, entertainment and
value expression benefits, in common with shoppers who are prone to monetary
promotions. Both monetary and non-monetary promotion-prone shoppers feel
financially constrained. In addition, non-monetary promotion-prone shoppers
enjoy gambling and other hedonic outcomes. The managerial implications of our
research findings are that many monetary sales promotion-prone shoppers may
be attracted by the benefits provided by non-monetary promotions. The
increased use by managers of non-monetary promotions instead of monetary
promotions may result in improved category value and brand equity benefits.

Keywords sales promotion; non-monetary; benefits; proneness; mavenism;

CATI

Introduction

The growing competition posed by grocery retailers’ own brands is significant and
impacts the performance of national brand manufacturers (Ailawadi, Neslin, &
Gedenk, 2001; Ashley, 1998; Macé & Neslin, 2004). Some European countries are
seeing private label market share in excess of 30% (Liu & Wang, 2008) and retailers
in other markets are targeting those levels of share (Sibillin, 2007). There is growing
© 2014 Westburn Publishers Ltd.
 248 Journal of Marketing Management, Volume 31

evidence that shoppers are becoming more engaged with in-store non-monetary
promotions (Kalra & Shi, 2010; Peattie, Peattie, & Emafo, 1997), more shopping
decisions are being made in the store and expenditure on in-store marketing
communications is rising (Chandon, Hutchinson, Bradlow, & Young, 2009; Lowe
& Barnes, 2012; Stilley, Inman, & Wakefield, 2010). There is also evidence that the
overuse of monetary promotions can be damaging to brand equity and the value of
product categories (Delvecchio, Henard, & Freling, 2006; Yi & Yoo, 2011; Yoo,
Donthu, & Lee, 2000). The net effect of this increased competition for national
brand manufacturers has been increased price-based competition, a lowering of
consumers’ reference prices in particular product categories and a reduction of the
presence of manufacturers’ brands (Fornari, Fornari, Grandi, & Menegatti, 2013).
Given this context, national brand manufacturers will benefit from improving their
understanding of consumers’ proneness to participating in certain types of non-price
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sales promotions.
Research on sales promotions has concentrated primarily on price-based or
monetary promotions (Ailawadi, Beauchamp, Donthu, Gauri, & Shankar, 2009). It
has attempted to identify deal-prone shoppers by linking psychographic and
demographic traits to the utilitarian and hedonic benefits of sales promotions
consumption and reactions to promotions (Bawa, Srinivasan, & Srivastava, 1997;
Blattberg, Buesing, Peacock, & Sen, 1978).
Other research has identified deal proneness as being context and deal-type
specific (Lichtenstein, Netemeyer, & Burton, 1995; Schneider & Currim, 1991).
Research has classified proneness as applying differently to active (deals discovered
out of store) and passive (reacting to deals within the store) sales promotions
(Schneider & Currim, 1991). Distinctions between proneness and different types of
out-of-store promotions have been made (Delvecchio, 2005), but little research has
examined the factors that drive variations in proneness to different types of passive
(discovered in-store) sales promotions.
Drawing on the promotions benefits framework proposed by Chandon, Wansink, and
Laurent (2000), and the role of costs in promotions proneness (Ailawadi et al., 2001),
this study adds to the body of research by examining the factors that influence proneness
to in-store promotions and compares proneness to monetary in-store sales promotions
with proneness to non-monetary in-store sales promotions. Additionally, we examine the
role of gambling enjoyment in proneness to in-store promotions (McDaniel, 2002).
Specifically we investigate three types of in-store promotions: price promotions
(discounts, two-for-one, increased volume promotions), on-pack sweepstakes and
contests, and premiums (gifts attached to the packaging of the promoted product).
Three research questions subsequently underpin our study and analysis:

1. What is the effect of shoppers’ economic constraints, economic and hedonic

motivations and search costs on their relative proneness towards three forms
of in-store sales promotion?
2. Do shoppers who are prone to monetary promotions have utilitarian and
hedonic motivations that are likely to make them prone to non-monetary
promotions?
3. What effect does gambling enjoyment have on shoppers’ relative proneness to
the three forms of promotions?
 Reid et al. Economic and utilitarian benefits 249

The findings of this study extend earlier work on sales promotion by demonstrating
that non-monetary promotions provide many of the same benefits as in-store
monetary promotions to shoppers, particularly those with mavenistic tendencies,
impulsiveness, financial constraints and those motivated to conform to the wishes
of others. The study establishes the role of gambling enjoyment in non-price
promotion proneness and highlights the association between an embedded
psychological enjoyment of games and proneness to promotions. The results
suggest that shoppers who are prone to monetary promotions are likely to be more
prone to non-monetary promotions than was previously thought.

Conceptual development and hypotheses

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In order to examine the influence of consumer characteristics on proneness to

monetary and non-monetary sales promotion, we adopt the promotions benefits
framework developed by Chandon et al. (2000). This framework identifies that
there are six benefits of sales promotions to shoppers: monetary savings; access to
higher quality products at a lower than usual price; reduction of consumer search
and decision costs; a ‘value expression’ benefit; an ‘exploration’ benefit; and an
‘entertainment’ benefit (Chandon et al. 2000, p. 66). The framework reveals that
promotions can provide utilitarian and hedonic benefits. Utilitarian benefits are
savings, quality, convenience and purchasing the optimal product. Hedonic
benefits are entertainment, exploration and increased self-esteem. The value
expression benefit is both utilitarian and hedonic (Chandon et al., 2000). It
allows a shopper to use promotions to demonstrate their shopping prowess and
to gain social affiliation by delivering value to their household. The framework
also establishes that non-monetary promotions can provide value expression,
exploration and entertainment benefits. We add to the framework by
introducing gambling enjoyment as an additional entertainment benefit, and by
examining the impact of the motivation to seek promotions benefits, specifically
in the context of monetary and non-monetary promotions encountered in store.
We further incorporate a search cost dimension to the study (Ailawadi et al.,
2001). Although Chandon et al. (2000) have classified reduced search and
decision costs as a convenience benefit, Ailawadi et al. (2001) have characterised
them as costs and added inventory costs as a factor likely to affect promotion
proneness.
The variation in proneness to different forms of sales promotion in different
domains has been recognised and suggested as an area requiring further research
(Lichtenstein et al., 1995). Researchers have responded by examining the
characteristics of coupon and deal-prone consumers (Garretson & Burton,
2003), premium-prone consumers (Prendergast, Poon, Tsang, & Fan, 2008)
and the relative effectiveness of monetary and non-monetary promotions in
the introduction of new products (Lowe & Barnes, 2012). We continue with
this adoption of the domain-specific approach and restrict our examination to
the in-store domain with a specific focus on consumer-packaged goods. The
conceptual model that explains the hypotheses we tested is illustrated in
Figure 1.
 250 Journal of Marketing Management, Volume 31

Figure 1 Hypothesised effects.

Utilitarian Benefits

H1: Price Consciousness Hedonic Benefits

H3: Quality Consciousness PRICE-BASED
PROMOTION
PRONENESS H4: Shopping Enjoyment
H2: Financial Constraints H5: Innovativeness
H6: Variety Seeking
H7: Impulsiveness
Costs SWEEPSTAKE
H8: Mavenism
H10: Motivation to Conform
and CONTEST
PRONENESS
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H11: Brand Loyalty

H9: Gambling Enjoyment

H12: Shopping Planning PREMIUM

PRONENESS
H14: Storage Space

Positively Associated
H13: Time Pressure
Negatively Associated

Utilitarian benefits
Sensitivity to economic benefits and willingness to trade off product quality
have been shown to affect price-based promotion proneness (Ailawadi et al.,
2001; Blattberg et al., 1978; Chandon et al., 2000; Martínez & Montaner,
2006). Economic motivations for engaging in promotions should predispose
shoppers to predominantly price-based promotions. We expect price-conscious
shoppers to be price-promotion prone, but expect a negative association
between price consciousness and non-monetary promotions as the latter do
not provide a direct economic benefit [H1] (Ailawadi et al., 2001; Chandon
et al., 2000).
Financially constrained shoppers should be prone to all forms of sales
promotion in their search for extra value [H2] (Martínez & Montaner,
2006). Price-based promotions provide value through lower prices, premiums
add value through the free gift, and contests and sweepstakes provide value
through the entertainment benefit of engaging with the promotion at no
additional cost.
The promotions benefits framework (Chandon et al., 2000) posits that monetary
promotions give access to higher quality products at a lower than usual price and so
provide a utilitarian benefit. Other research has found no association between
quality consciousness and the use of in-store promotions (Ailawadi et al., 2001;
Martínez & Montaner, 2006). We hypothesise that quality consciousness will be
positively associated with proneness to monetary promotions but negatively
associated with proneness to non-monetary promotions [H3]. For the purposes of
brevity, using the approach of Ailawadi et al. (2001), a summary of our hypotheses
is found in Table 1.
 Reid et al. Economic and utilitarian benefits 251

Table 1 Summary of hypothesised relationships.

Dependent variable

In-store price prone Contest prone Premium prone

Economic/utilitarian factors
H1: Price consciousness + − −
H2: Financial constraints + + +
H3: Quality consciousness + − −
Hedonic/psychosocial factors
H4: Shopping enjoyment + + +
H5: Innovativeness + + +
H6: Variety seeking + + +
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H7: Impulsiveness + + +
H8: Mavenism + + +
H9: Gambling enjoyment − + +
H10: Motivation to conform + + +
Search cost factors
H11: Brand loyalty − − −
H12: Planning + − −
H13: Time pressure + − +
H14: Storage space + − −
Note: + = positive association; − = negative association.

Hedonic benefits
The hedonic benefits provided by sales promotions include exploration, self-
expression and entertainment (Bellizzi, Hamilton, Krueckeberg, & Martin, 1981;
Chandon et al., 2000; Schindler, 1989) and have been associated with differences in
the psychographic profiles of shoppers and their proneness to sales promotion
(Ailawadi et al., 2001; Bucklin & Lattin, 1991). Those who are prone to out-of-
store promotions are price-conscious, mavenistic and enjoy shopping, and as such are
seeking economic and hedonic benefits from promotions (Ailawadi et al., 2001). In
the past, it has been suggested that in-store-promotion-prone shoppers tend to react
passively to in-store promotions (Schneider & Currim, 1991).
In other research, out-of-store-promotion-prone shoppers have been found to
enjoy the shopping task (Garretson & Burton, 2003; Schindler, 1989), to have
increased levels of mavenism in that they desire to be seen to be aware of what
constitutes good value (Ailawadi et al., 2001; Blattberg & Neslin, 1990; Chandon
et al., 2000; Garretson & Burton, 2003), and to be motivated to conform to the
expectations of significant others (Ailawadi et al., 2001; Chandon et al., 2000). The
hedonic benefits of exploration tend to be sought by shoppers who display tendencies
towards impulsiveness, innovation and variety seeking (Ailawadi et al., 2001;
Chandon et al., 2000). Martínez and Montaner (2006) showed that mavenism,
impulsiveness and innovation are associated with price-based in-store promotions,
but these psychographic characteristics are variably associated with coupons and store
flyers. Little is known of the specific psychographics of those shoppers prone to non-
monetary in-store promotions (Prendergast et al., 2008).
 252 Journal of Marketing Management, Volume 31

Given that the contemporary shopping environment is one where competition and
choice of promotions have increased (Chandon et al., 2009; Stilley et al., 2010), we
would expect the in-store-promotion-prone shopper to exhibit similar
psychographics to active, out-of-store-promotion-prone shoppers. This is because
of the increased expenditure on in-store marketing (Chandon et al., 2009; Stilley
et al., 2010) that results in the sales promotion options available to shoppers not
being fully known until the shopper is in the store. The increased opportunity to
react to new promotions in the changing in-store environment means that the
entertainment benefit previously provided by out-of-store deals to those who enjoy
shopping (Ailawadi et al., 2001; Martínez & Montaner, 2006) could now be
provided by in-store promotions. The entertainment benefit will be valued by those
who enjoy shopping [H4].
The exploration benefit of sales promotions fulfils the need for exploration,
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stimulation and variety (Ailawadi et al., 2001; Chandon et al., 2000; Prendergast
et al., 2008). The nature of in-store promotions provides the benefit. The competitive
in-store environment and relative short-term nature of promotions require that
promotions be able to attract the attention of shoppers. Variety seeking is a
consequence of shoppers seeking their optimal stimulation level (Michaelidou,
2012) and in-store sales promotions contribute to that stimulation and provide the
opportunity for variety seekers to switch brands within a target product category.
Responding to in-store promotions may also require shoppers to make unplanned
category purchases. To discover and be able to use an in-store promotion reflects a
level of innovativeness that allows the abandonment of shopping plans (Ailawadi
et al., 2001). Shoppers will do this if they have sufficient slack in their mental budgets
(Stilley et al., 2010). Similarly, a shopper demonstrates impulsiveness when making
in-store decisions about a just-discovered promotion (Ailawadi et al., 2001). These
needs for innovativeness, variety seeking and impulsiveness can be satisfied by the
exploration benefits of both monetary and non-monetary in-store promotions. In
summary, the exploration benefit offered by in-store monetary promotions, contests
and sweepstakes, and premiums will be sought by those with high levels of
innovativeness [H5], variety seeking [H6] (Ailawadi et al., 2001; Prendergast et al.,
2008) and impulsiveness [H7] (Ailawadi et al., 2001).
If we consider the characteristics of shoppers that have been shown in the past to
lead from proneness to different forms of promotions, we can see that the value
expression benefit will be sought by those who consider themselves to be mavens or
who are motivated to conform – that is, to gain the approval of significant others by
identifying deals (Ailawadi et al., 2001; Chandon et al., 2000; Cialdini & Goldstein,
2004). The value expression benefit can be considered both hedonic and utilitarian
(Chandon et al., 2000). Mavens express themselves and gain status by being
considered knowledgeable and astute shoppers (Ailawadi et al., 2001; Chandon
et al., 2000; Feick & Price, 1987). Past research has shown mavens to be prone to
out-of-store promotions but variably prone to in-store promotions (Ailawadi et al.,
2001; Martínez & Montaner, 2006). With the need for increased decision-making in-
store because of the dynamic and competitive contemporary sales promotions
environment, we expect mavens to extract expression benefits from both monetary
and non-monetary promotions. Mavenism will be positively associated with
proneness to monetary sales promotions, contests and sweepstakes, and premiums
[H8] (see Table 1).
 Reid et al. Economic and utilitarian benefits 253

The value expression benefit can also be derived by shoppers who consider it their
duty to obtain value or be responsible in their product and brand choices (Chandon
et al., 2000). This expression of self is related to a shopper’s motivation to conform
to the expectations of others (Ailawadi et al., 2001). Thus, motivation to conform
will be positively associated with proneness to monetary sales promotions, contests
and sweepstakes, and premiums [H10].
In order to extend the range of benefits examined in the context of non-price
promotion, this research introduces the concept of gambling enjoyment as a predictor
of non-price sales promotion proneness. The enjoyment of gambling has been found
to be related to the participation of shoppers in sales promotions based on games
(McDaniel, 2002). Sweepstakes have been shown to be attractive to shoppers who
have a tendency to engage in gambling activities or who are impulsive or sensation
seekers (McDaniel, 2002) and to those shoppers who enjoy games (Ward & Hill,
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1991). Blattberg and Neslin (1990) suggest that a premium or prize can serve as an
unconditioned stimulus that elicits excitement or emotion. Understanding the degree
to which a psychological predisposition for gambling enjoyment may motivate
promotion participation and choice will allow improved design of contests and
sweepstakes. We expect gambling enjoyment to be positively associated with
contest proneness and premium or gift proneness. As gambling enjoyment is driven
by the benefit of playing a game or being involved in a sweepstake with an unknown
outcome, which to the price-conscious shopper may be seen as having no value, we
expect it to be negatively associated with monetary promotion proneness [H9].

Search cost drivers

Shoppers are often concerned about the potential non-financial, physical and
psychological search costs associated with the acquisition of value through sales
promotion. The costs of sales promotion participation include switching costs for
the brand loyal shopper, inventory holding costs of stockpiling, the time costs
associated with the shopping expedition and the cognitive costs of planning
shopping based on promotion usage (Ailawadi et al., 2001; Prendergast et al., 2008).
Brand loyal shoppers perceive a cost of switching from their usual brand to a
promoted brand (Ailawadi et al., 2001); therefore, we expect brand loyalty to be
negatively associated with all three forms of in-store promotion [H11]. We expect
shoppers who plan their shopping to be prone to price promotions in-store as they
perceive an economic benefit in planning shopping and this benefit is delivered by
price promotions (Ailawadi et al., 2001; Schneider & Currim, 1991). We also expect
planning to be negatively associated with proneness to non-monetary
promotions [H12].
Within the store, assessing the value of a price discount or a premium is relatively
straightforward, whereas the value of a contest requires some degree of mental
accounting (Jha-Dang & Banerjee, 2005). Thus, we expect a positive association
between perceived time pressure and price and premium proneness, but a negative
association between time pressure and contest proneness [H13]. Shoppers with
storage space are likely to be prone to price promotions because they are able to
stockpile purchases easily (Ailawadi et al., 2001). The value derived from contests
and premiums does not require stockpiling, we therefore expect a positive association
between storage space and monetary-promotions proneness and a negative
 254 Journal of Marketing Management, Volume 31

association between availability of storage space and contest and premium

proneness [H14].

Methods

Data collection
The data for this study were collected through the engagement of a professional field
market research house and the application of computer-aided telephone interviewing
(CATI). The phone interviews were completed over a 1-week period, with each
interview lasting approximately 15 minutes. The sampling frame was a major
Australian city and potential respondents were sourced through random sampling
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from the White Pages telephone directory. The conditions for inclusion in the survey
were that the respondent must be at least 18 years of age and must be the main
grocery shopper for the household. In total, the survey consisted of interviews with
500 main household grocery-buying adults. There were 1842 refusals encountered
through the CATI process, along with 55 partial respondents who refused to
continue the interview and subsequently terminated the call.
Survey respondents were aged between 18 and 75 years, with 56% being between
35 and 59 years. Of the respondents, 76% were female, which is in line with
international research on grocery purchasing and promotion use in the United
States and elsewhere (see, for example, Ailawadi et al., 2001 [66%]; Garretson &
Burton, 2003 [78%]; Lichtenstein, Burton, & Netemeyer, 1997 [76%]; and
Olavarrieta, Hidalgo, Manzur, & Farías, 2012 [72%]). Within the sample, 40% had
a high school level education, while 44% had a university level qualification. Two-
person households comprised 32%, and a further 37.4% had between three and four
persons residing in the home. Almost half, or 47%, of respondents spent between
AU$100 and AU$199 per week on groceries.

Measures
Established scales and items were employed where possible (see Appendix). The
economic, hedonic and search cost variables for this study were drawn from
Martínez and Montaner (2006) and Ailawadi et al. (2001). The scale for in-store
price promotion proneness was drawn from Putrevu and Ratchford (1997) in
combination with Garretson and Burton (2003), while the scales for contest-
sweepstake proneness and gift-premium proneness were taken from Lichtenstein
et al. (1995) and Lichtenstein et al. (1997), respectively. The new gambling
proneness scale was based partially on the work of McDaniel (2002) but was
modified to reflect the forms of gambling that are popular in Australia. All
psychographic and proneness items were measured on 7-point Likert-type scales.

Reliability and validity

Table 2 presents the descriptive statistics, bivariate correlations for main factors and
their association with forms of in-store sales promotion proneness, reliability and
validity of the scales and associated factors. A series of confirmatory factor analyses
were undertaken to assess convergent and discriminant validity. In-store sales
 Reid et al. Economic and utilitarian benefits 255

Table 2 Descriptive statistics, bivariate correlations, square roots of average variance

extracted.

Price Contest Premium

Factors Mean SD α AVE prone prone prone
Proneness
1 Price prone 4.4 1.5 0.73 0.56 –
2 Contest prone 2.4 1.6 0.85 0.70 0.41** –
3 Premium prone 2.9 1.3 0.89 0.76 0.48** 0.68** –
Utilitarian factors
4 Price consciousness 4.9 1.6 0.69 0.65 0.62** 0.22** 0.26**
5 Financial constraints 3.4 1.3 0.68 0.65 0.30** 0.27** 0.26**
6 Quality consciousness 4.9 1.2 0.67 0.64 −0.04 −0.04 0.02
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Hedonic factors
7 Shopping enjoyment 3.2 1.6 0.75 0.71 0.12** 0.18** 0.13**
8 Innovativeness 4.3 1.4 0.75 0.61 0.31** 0.26** 0.31**
9 Variety seeking 3.9 1.2 0.75 0.55 0.34** 0.20** 0.24**
10 Impulsiveness 3.7 1.4 0.75 0.71 0.23** 0.26** 0.35**
11 Mavenism 3.7 1.3 0.66 0.56 0.15** 0.41** 0.31**
12 Gambling enjoyment 2.2 1.3 0.67 0.64 0.39** 0.31** 0.33**
13 Motivation to conform 2.8 1.7 0.63 0.54 0.34** 0.41** 0.43**
Search costs
14 Brand loyalty 4.7 1.7 0.63 0.60 0.05 0.04 0.06
14 Planning 5.3 1.2 0.61 0.58 0.14** −0.03 −0.08*
16 Time pressure 4.7 1.2 0.76 0.72 0.22** 0.09* 0.18**
17 Storage space 4.2 1.4 0.66 0.65 0.30** 0.10* 0.13**
Notes: *p < 0.05; **p < 0.01.
CFA results: Sales Promotion Proneness [X2, 245.09 (DF,132, p = 0.000); CFI = 0.95; CFI = 0.97;
TLI = 0.96; RMSEA = 0.04]; Economic/Utilitarian Factors [X2,70.45 (DF,24, p = 0.000); CFI = 0.97;
CFI = 0.94; TLI = 0.91; RMSEA = 0.06]; Hedonic/Psychosocial Factors [X2, 308.5 (DF,149, p = 0.000);
CFI = 0.93; TLI = 0.91; RMSEA = 0.05].

promotion proneness factors performed well in terms of convergent validity, with

average variance extracted all greater than 0.50 (Fornell & Larcker, 1981; Sarkar,
Echambadi, Cavusgil, & Aulakh, 2001). The premium proneness and contest
proneness constructs did not perform well in terms of discriminant validity; thus,
further analysis was conducted whereby the covariance between the two constructs
was constrained to unit (1) and the chi-square was compared to the unconstrained
model. The results suggested that the individual constructs could be retained.
The hedonic factors performed well and while the factors of variety seeking and
innovativeness did not discriminate well, a decision was made to retain them as
theoretically distinct factors (Sarkar et al., 2001). The economic and search cost
factors performed well in terms of both convergent and discriminant validity.
Overall, the reliability of the different factors, although lower than the reliability
found by Ailawadi et al. (2001) and Martínez and Montaner (2006), was acceptable
and is sufficiently robust to enable multivariate analysis.
A number of steps were taken to minimise the implications and likelihood of
common methods bias. First, we utilised constructs with known properties having
 256 Journal of Marketing Management, Volume 31

been tested in prior research, thereby reducing issues of item ambiguity – a key
recommendation of Podsakoff, Mackenzie, Lee, and Podsakoff (2003). The field
house interviewers communicated to respondents that they were employees of an
independent organisation collecting the data on our behalf, reassuring respondents of
their anonymity and that there would be full de-identification of data. This approach
has the benefit of reducing evaluation apprehension and means that those
interviewed will be less likely to respond in ways that are socially desirable and/or
they feel researchers want them to respond (Podsakoff et al., 2003). Furthermore, the
questionnaire and its CATI administration were pretested with a set of respondents
and the results reviewed, with CATI interviewers able to comment on the ability of
respondents to answer questions easily and appropriately. Finally, using the lowest
positive correlation (quality consciousness and premium proneness) as a proxy for the
marker variable (Lindell & Whitney, 2001) and following the procedure used by
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Malhotra, Kim, and Patil (2006), we found that a majority of previously significant
correlations remained significant after adjusting for common method variance
(CMV). This suggests that CMV may not be an issue in this data.

Results

Linear regression was conducted to test the hypotheses. A dummy variable was used
to control for the influence of gender on sales promotion proneness. Table 3 presents
standardised parameters, R2 and adjusted R2 of the models for in-store price
promotion proneness, contests and sweepstakes proneness, and premium proneness.
The final models accounted for 50% of the total variance in in-store price
proneness, 33% of the total variance for on-pack contest and sweepstake proneness
and 34% of the total variance for on-pack premium and gift proneness. Table 4
presents a summary of the results showing the initial hypothesised direction of the
relationships and whether each was subsequently accepted or rejected.
For in-store price proneness, the utilitarian factor of price consciousness
(β = 0.426, p < 0.001) is most associated with this type of proneness, followed by
financial constraints (β = 0.109, p < 0.01). In contrast to what was hypothesised, a
negative relationship with quality consciousness (β = −0.066, p < 0.05, 1 tailed test)
was identified, suggesting that price-conscious shoppers or shoppers with financial
constraints are prepared to sacrifice quality for price (Mägi & Julander, 2005).
Hedonic factors illuminate other aspects of the in-store-price-prone consumer, with
motivation to conform (β = 0.147, p < 0.001), impulsiveness (β = 0.091, p < 0.01),
variety seeking (β = 0.089, p < 0.01) and mavenism (β = 0.087, p < 0.05) having
significant associations. There was no statistical association between the new factor of
gambling enjoyment and in-store price promotion proneness. For search cost factors,
a single significant positive relationship was found with availability of household
storage space to hold items bought in bulk (β = 0.152, p < 0.001).
For on-pack contest and sweepstake proneness, much of the explanation is found in
the hedonic characteristics of shoppers and the self-expression and exploration benefits
sought from participation in this form of promotion. Proneness to contests was strongly
related to the new variable of gambling enjoyment (β = 0.267, p < 0.001) and also with
motivation to conform (β = 0.225, p < 0.001), mavenism (β = 0.129, p < 0.01),
shopping enjoyment (β = 0.110, p < 0.01), innovativeness (β = 0.09, p < 0.05) and
impulsiveness (β = 0.081, p < 0.05). For utilitarian factors, there was a negative
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Table 3 Multiple regression of sales promotion proneness.

In-store price proneness Contest proneness Premium proneness

Std Coeff Beta t-Value Std Coeff Beta t-Value Std Coeff Beta t-Value
Control
Female −0.004 −0.126 0.005 0.123 0.030 0.814
Age −.005 −0.132 −0.73 −1.976* 0.066 −1.670+
Utilitarian factors
H1: Price 0.426 11.16*** 0.049 1.112 0.067 1.513
consciousness
H2: Financial 0.109 3.056** 0.093 2.241* 0.070 1.755
constraints
H3: Quality −0.066+ −1.739 −0.090 −1.965* −0.037 −0.851
consciousness
Hedonic factors
H4: Shopping enjoyment 0.054 1.549 0.110 2.656** 0.068 1. 672
H5: Innovativeness 0.028 0.688 0.090 1.970* 0.105 2.264*
H6: Variety seeking 0.089 2.274** 0.005 0.113 −0.004 −0.083
H7: Impulsiveness 0.091 2.564** 0.081 2.015* 0.160 3.830***
H8: Mavenism 0.087 2.214* 0.129 2.838** 0.148 3.269**
H9: Gambling −0.028 −0.780 0.267 6.565*** 0.127 3.151**
enjoyment
H10: Motivation to 0.147 4.025*** 0.225 5.322*** 0.249 5.893***
conform
Search costs
H11: Brand loyalty 0.014 0.357 0.049 1.107 0.046 1.044
H12: Planning 0.055 1.516 −0.048 −1.145 −0.102 −2.447**
H13: Time pressure 0.042 1.172 −0.030 −0.716 0.035 0.835
H14: Storage space 0.152 4.471*** −0.005 −0.117 0.033 0.850
Model R2: 0.52 R2: 0.35 R2: 0.36
Adj R2: 0.50 Adj R2: 0.33 Adj R2: 0.34
Reid et al. Economic and utilitarian benefits

F: 32.43*** F: 16.56*** F: 17.23***

Note: +p < 0.05 (1-tailed); *p < 0.05; **p < 0.01; ***p < 0.001.
257
 258 Journal of Marketing Management, Volume 31

Table 4 Summary of hypothesised relationships and results.

Dependent variable

In-store-price prone Contest prone Premium prone

Economic/utilitarian Factors
H1: Price consciousness +accept −ns −ns
H2: Financial constraints +accept +accept +ns
H3: Quality consciousness +reject −accept −ns
Hedonic/psychosocial factors
H4: Shopping enjoyment +ns +accept +accept
H5: Innovativeness +ns +accept +accept
H6: Variety seeking +accept +ns +ns
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H7: Impulsiveness +accept +accept +accept

H8: Mavenism +accept +accept +accept
H9: Gambling enjoyment −ns +accept +accept
H10: Motivation to conform +accept +accept +accept
Search cost factors
H11: Brand loyalty −ns −ns −ns
H12: Planning +ns −ns −accept
H13: Time pressure +ns −ns +ns
H14: Storage space +accept −ns −ns

association with quality consciousness (β = −0.09, p < 0.05), and a positive relationship
with financial constraints (β = 0.093, p < 0.05), possibly reflecting the hope and desire
of some consumers to win big and alleviate such constraints. None of the search cost
factors had a significant association with contest and sweepstake proneness. There was a
significant association with younger age groups (β = −0.08, p < 0.05), but no gender
effect.
On-pack premium and gift proneness was also strongly related to hedonic factors
and the exploration and self-expression benefits sought, including motivation to
conform (β = 0.249, p < 0.001), impulsiveness (β = 0.160, p < 0.001), mavenism
(β = 0.148, p < 0.01), innovativeness (β = 0.105, p < 0.05) and, to a lesser extent,
shopping enjoyment (β = 0.068, p < 0.05, 1 tailed test). This form of promotion was
also associated with gambling enjoyment (β = 0.127, p < 0.01), likely reflecting the
overall psychological need for excitement during the shopping task (McDaniel,
2002). There were no associations for utilitarian factors; however, a significant
negative association was found with the search cost factor of planning
(β = −0.102, p < 0.05). None of the other search cost factors were significant.
Similar to contest proneness, there was a weak association with younger age groups
(p < 0.1) but no gender influence.

Discussion and implications

There were several motivations underpinning this study, including the need to
identify whether an opportunity exists to reduce the overuse of price-based
 Reid et al. Economic and utilitarian benefits 259

competition by manufacturers seeking to retain sales in the face of increasing store

brand presence, and to determine what benefits consumers seek that might aid in this
quest. From the perspective of the theory associated with sales promotion
engagement the results show that benefits sought, especially hedonic benefits, are
significantly associated with both monetary and non-monetary promotions and that
these associations can be used to inform the strategic use and design of sales
promotions. The main findings are:

1. Hedonic benefits strongly influence the proneness of consumers towards both

monetary and non-monetary promotions. In particular, motivation to conform,
mavenism and impulsiveness have strong associations with all three promotion
types.
2. Gambling enjoyment is strongly associated with both contest proneness and
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premium proneness and taps into the motivation and desire to win.
3. The utilitarian factor of price consciousness strongly influences price
proneness, while financial constraints and not being quality conscious have
an influence on both price proneness and contest proneness.
4. Search cost factors provide little explanation of sales promotion proneness.
Only shopping planning and storage space have an association with monetary
promotions; the other factors have no association with any form of in-store
promotion.
5. Proneness to sales promotion seems to be independent of gender but some
indication exists that younger age groups are more attracted to contests and
premiums.

While Chandon et al. (2000) have argued that utilitarian benefits are drivers of
monetary proneness, overall we found that shoppers with financial constraints are
prone to non-monetary as well as monetary promotions. Further, the importance of
hedonic psychosocial factors, and the seeking of benefits associated with self-
expression, exploration and entertainment, suggests that consumers are likely to be
more active in store with regard to sales promotions, especially non-monetary
promotions, than previously identified in the extant literature. An increased level
of activation in store may result in some shoppers being persuaded to shift from a
monetary promotion to a non-monetary one if it is well designed.
Hedonic psychosocial factors play a significant role in proneness towards sales
promotion. The positive association identified in this study between mavenism,
motivation to conform and in-store non-price promotions contrasts with the
findings of prior research (Ailawadi et al., 2001; Martínez & Montaner, 2006),
and points to the need of some shoppers to demonstrate their prowess in making
good shopping, brand and product choices.
Consumers who are motivated to conform may be more susceptible to
interpersonal influence and may be motivated to participate in certain forms of
sales promotion in response to peer or spousal expectations and interaction (Koller,
Floh, Zauner, & Rusch, 2013). The desire to express their ability and to seek
approval is likely to result in a more intensive in-store shopping regime and
suggests an active rather than passive engagement with in-store promotional
activities or with manufacturers and retailers. More active engagement in store has
implications for the way in which manufacturers display promotions on their
 260 Journal of Marketing Management, Volume 31

packaging or through other in-store devices to attract attention, encourage

impulsiveness but also to reinforce and signal good shopping practices.
There is an increasing body of research around consumers who have mavenistic
tendencies (Goldsmith, Flynn, & Clark, 2012). Feick and Price (1987) introduced the
concept of market mavenism to describe a unique pattern of consumer behaviour
whereby a minority of retail consumers disproportionately influence the behaviour of
other consumers (Goldsmith et al., 2012). In the context of sales promotion it is
feasible to suggest that for some consumers, discovering, noticing, purchasing and
being able to relay information to others about in-store deals, including price
discounts, competitions and premiums, are important. Mavens are often considered
to exert a disproportionate influence as opinion leaders across multiple product
categories, especially in relation to new trends in retail markets, are important for
national brand marketers to identify and motivate (Geissler & Edison, 2005). In
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combating store brands, manufacturers need to design sales promotions that persuade
mavens to become brand advocates and to further use their desire for recognition to
drive participation in non-price sales promotion activities. Providing mechanisms to
harness their propensity to provide word-of-mouth recommendations (for example,
verbally, or via Twitter and Facebook) can heighten others’ participation in contests
or their awareness of added value in the form of premiums.
The finding of a positive relationship between gambling enjoyment and contest
and premium proneness is important and highlights the propensity for some
consumers to enjoy the emotional and physical stimulation of participation in sales
promotion. Gambling taps into human biopsychology and evokes powerful
psychological processes, connecting strong sociocultural meanings associated with
the dream of hitting the jackpot and transforming one’s life, social rewards,
intellectual challenges and mood (Binde, 2013). Regardless of the moral debate
around gambling behaviours, manufacturers who can design promotions that tap
into this innate consumer desire will likely enjoy sales and consumer equity
benefits. The limited amount of research in this area highlights the need for more
detailed investigations of the connection between consumer psychology, gambling
and sales promotions (McDaniel, 2002).
Our research also found that impulsiveness is associated with all forms of
promotion. Impulsiveness in shopping is often expressed through the purchase of
unplanned items (Beatty & Ferrell, 1998) and is often hedonically driven, with
consumer behaviour marked by exploration benefit seeking and pleasure seeking
(Bayley & Nancarrow, 1998). Further, it may be stimulated by such traits as
enjoyment of gambling, the need for variety or the mavenistic need to prove one’s
shopping prowess through the acquisition of some form of extra value. Marketers
need to leverage the propensity for consumers to be impulsive through the design of
contests and sweepstakes, the targeted attractiveness of premiums and gifts, and on-
shelf devices that signal on-pack promotions (Duarte, Raposo, & Ferraz, 2013).
For other hedonic factors, we found that variety seeking was most associated with
in-store price proneness while innovativeness was associated with both premiums and
contests. The result for variety seeking contrasts with the findings of Ailawadi et al.
(2001), who found no association with in-store promotion usage. Our finding in
relation to innovativeness also differs from that of Ailawadi et al. (2001), but is in line
with Martinez and Montaner’s (2006) results, who identified a positive association
between innovativeness and in-store promotion usage, albeit for different types of
promotions. Finally, shopping enjoyment was found to be associated with contest and
 Reid et al. Economic and utilitarian benefits 261

sweepstake proneness but not with price or premium proneness. Shopping enjoyment
is related to a motive for exploration and provides hedonic value when customers
appreciate the excitement of a product or information search (Chandon et al., 2000).
Contest-prone shoppers are quite likely to spend more time in store and see shopping
as a form of entertainment, part of which involves interaction with brands that offer
added entertainment forms such as contests or sweepstakes. Manufacturers should
consider how to build excitement into the design, display and participation aspects of
non-price sales promotions.
Although hedonic benefits dominate the propensity to engage in sales promotion,
there are several important associations related to utilitarian benefits sought by
consumers in the form of savings. Price consciousness, not surprisingly, is strongly
associated with in-store-price-prone consumers and is of concern for national brand
manufacturers who are seeking to reduce the overuse of price as a basis for
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competition. While others have found that price proneness and quality
consciousness are positively related, we found the opposite. For many shoppers,
especially in harder economic times, the access to lower prices overwhelms the
desire to increase the quality of products they can access for the same money. It
may also be the case that increased manufacturer price discounting and the
improvements made to the quality of store brands mean that shoppers can access
acceptable quality products at lower prices.
We found that search cost factors have very little impact on proneness to in-store
non-price promotions, apart from storage space and price proneness and a lack of
planning and premium proneness. No associations were found for brand loyalty, even
though it was suspected that lower levels of loyalty are associated with higher levels
of proneness. Time constraints also have no association, which fits with Prendergast
et al.’s (2008) findings on premium proneness.
Overall, the results imply that more decision-making about product choices and
promotion engagement is likely to be made in store than has previously been found.
Some shoppers may be more impulsive and more attracted to the in-store price
promotions. Such shoppers demonstrate an unplanned shopping decision state
(Bucklin & Lattin, 1991) and passive deal proneness (Schneider & Currim, 1991).
Those shoppers who are innovative and prone to price-based promotions tend to
demonstrate active deal proneness (Schneider & Currim, 1991), but only engage in
their active promotion searching behaviour once they arrive in the store. The
possibility that significant levels of active search and decision-making occur in store
with regard to promotions would also explain the somewhat contradictory findings
about mavenism and in-store price and non-price proneness. With increased store
brand offers and increased in-store non-price promotional activity, it may be that
shoppers will engage less thoroughly in planning their purchases before arriving in
store due to the lack of information available outside the store about what is on offer.
For manufacturers who are interested in maintaining or improving only their
brands’ market shares without sacrificing profitability, the use of contests and
sweepstakes offers a better known cost structure than do price discounts or
premiums whose final costs are dependent on volume, unlike a competition
(Basuroy, Mantrala, & Walters, 2001). Such promotions are also thought to have
brand franchise building potential rather than placing significant downward pressure
on consumers’ reference price for the brand. Manufacturers who facilitate and
encourage consumers’ non-price-based sales promotion proneness through ease of
participation, attractive prizes and the offer of a potential small, immediate win may
 262 Journal of Marketing Management, Volume 31

find some reprieve from a discount mentality, and be able to add interest to a
category and improve brand associations with consumers. For example, promotions
that offer instant prizes through the entry of unique barcodes via SMS or the internet
minimise delay and heighten the expectation of gratification; and while a contestant
may not win a major prize they can be easily rewarded with a small prize such as an
online music or app download. Of course, such rewards need to be designed with the
target market in mind. For free gift and premium proneness, the added associated
value is an instant reward and heightens the desire to acquire extra value in the
future. The economic value for managers of increasing non-price proneness lies
specifically in the building of a brand’s franchise through excitement and brand
engagement (Kalra & Shi, 2010). Further, the ability to shift some purchasing away
from price promotion towards non-price promotion has positive implications for a
brand’s average price and the profitability of particular product categories.
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Conclusions and suggestions for future research

This study supports the call by Prendergast et al. (2008) and others to conduct more
research on non-price sales promotions and the factors that drive consumer
engagement with such promotions. Although the results presented here highlight
the value of conceptualising alternative forms of sales promotion use and proneness
using the benefit framework of Chandon et al. (2000), it is important to acknowledge
the limitations of this study and to suggest directions for future research.
First, our research has questioned the nature of active and passive sales promotion
proneness as it relates to non-price sales promotions and the association with the
mavenistic tendencies of shoppers. While Garretson and Burton (2003) have
identified equivocal results about the degree to which market mavens are prone to
price-based promotions, we are unaware of any research that examines the extent to
which mavens may be prone to in-store non-price promotions. If there is increased
in-store activeness due to mavenism, and/or a lack of planned shopping, this has
implications for the design and display of non-price sales promotions both in store
and on packaging.
Second, as price-based competition becomes more intense, especially with the
introduction of improved store brands, it would be fruitful to understand the
psychosocial and promotional design characteristics that would persuade consumers
to choose a non-price-promoted brand over a price-promoted brand. For
manufacturers, the ability to increase their average product or category offer price
through the use of non-price promotions has the benefit of increasing profitability
and reducing the downward pressure on consumer price perceptions for the brand.
Third, the use of self-reporting measures is subject to both under- and over-
inflation of behaviours, although Garretson and Burton (2003) have found
‘significant links’ (p. 166) between the self-reported measures and purchase
behaviour. Similarly, the cross-sectional nature of our study also has limitations.
Future research could adopt a longitudinal approach to track actual non-price sales
promotion use and understand the behavioural aspects of proneness rather than
psychological correlates.
Fourth, the reliability estimates for some of the scales point to the need for further
cross-cultural validation of measures of shopping behaviour and promotion
proneness. Given the positive association between gambling and several forms of
 Reid et al. Economic and utilitarian benefits 263

sales promotion, further work needs to be done to improve the scale, in order to
better understand the positive and negative implications of gambling for sales
promotion use.
Regardless of the above limitations, our results contribute to the growing body of
knowledge on the relationship between consumer psychology and participation in
alternative forms of sales promotion beyond price discounts. This area is still
significantly under-explored in terms of behavioural research and hence offers
considerable scope for researchers. From a managerial perspective, the insights
obtained from such research will enable manufacturers to consider alternative
strategies to retain, engage and acquire customers in ways that build brand
franchise rather than lower reference prices. Finally, a better understanding of such
promotions will enable managers to combat the growing pressure placed on them by
retailers’ own brands, which predominantly employ price-based discounts.
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Appendix
Survey items used

Price proneness Contest proneness

I look around for special price deals inside When I buy a grocery brand that is
the store before buying grocery products connected to a contest or sweepstake, I
feel that it is a good deal
I look for unadvertised specials offered by Manufacturers’ contests and sweepstakes
supermarkets are fun to enter, even though I know that
I’ll never win
I look for special displays in supermarkets I enjoy entering manufacturers’ contests
and sweepstakes
I have favourite grocery brands, but if I have favourite grocery brands, but if
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possible, I buy the brand that has the possible, I buy the brand that is
price discount connected with a contest or sweepstake
Buying the supermarket store specials can I often feel compelled to respond to
save a shopper a lot of money contest or sweepstake offers
Buying grocery products that are on special If I am indifferent between two grocery
makes me feel good brands, I would purchase the one that has
a contest or sweepstake associated with it

Premium proneness Variety seeking

I enjoy buying grocery products that come
with a free gift
I enjoy buying a grocery brand that comes with
a free gift, regardless of the value of the gift
I have favourite grocery brands, but when I
encounter a free gift offer, I am more
likely to buy the brand that comes with
the free gift
If I use the same brands over and over
again, I get tired of them
I buy different grocery brands to get some
variety
I like to try different things

Seeing a brand that comes with a free gift Mavenism

has influenced me to buy grocery brands I
normally would not buy
Beyond the money I save, buying a grocery
brand that comes with a free gift gives me
a sense of joy
Compared to most people, I am more likely to
buy grocery brands that come with free gifts
People think of me as a good source of
shopping information
I am somewhat of an expert when it
comes to shopping
I enjoy giving people tips on shopping

Price consciousness Motivation to conform

I find myself checking the prices even for It bothers me when people disapprove of
small grocery items my grocery choices
I compare the prices of at least a few It is important for me to fit in with those
brands in the supermarket before I around me
choose one
It is important to me to get the best price My behaviour often depends on how I feel
for the grocery products I buy others wish me to behave
(Continued )

Appendix (Continued).
Quality consciousness
I always buy the best grocery brands
It is important to me to buy high-quality
grocery products
I will not give up high quality for a lower
price
Financial constraints
My household grocery budget is always tight
I frequently have problems making ends
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meet
I often have to spend more money than I
have available
Shopping enjoyment
I think grocery shopping is a chore
I like to finish my shopping as quickly as
possible and get out of the store
I enjoy grocery shopping
Innovativeness
I like to try new and different things
I am often amongst the first people to try a For most supermarket items, I have
new product
When I see a grocery product somewhat
different from the usual, I check it out
Impulsiveness
I often find myself buying products on
impulse in the supermarket
I often make an unplanned purchase when
the urge strikes me
I consider myself to be an impulsive
grocery buyer
Reid et al. Economic and utilitarian benefits 267
Gambling enjoyment
I enjoy participating in scratch lotto tickets
I enjoy participating in Powerball,
TattsLotto or Oz Lotto
I enjoy betting on horse races or other
sporting events
I enjoy playing the pokies
Planning
I am a well-organised grocery shopper
I know what products I am going to buy
before going to the supermarket
I prepare a shopping list before going
grocery shopping
Storage
I have plenty of storage space at home
I have a lot of room at home to stock any
extra groceries I might buy
I often buy things on special and store
them for later use
Brand loyalty
I and my family will consume only certain
grocery brands, not others
favourite grocery brands and limit my
purchases to them
In most product categories in the
supermarket, there are certain grocery
brands for which I have a definite
preference
Time constraints
I always seem to be in a hurry these days
I never seem to have enough time for the
things I want to do
Most days, I have no time to relax
 268 Journal of Marketing Management, Volume 31

About the authors

Mike Reid is an Associate Professor of Marketing at RMIT University, School of Economics and
Finance. His academic research focuses on drivers of new product development (NPD) success,
consumer new product adoption, the use of sales promotions as a marketing tool and more
recently the issue of household obesity. He has published in a range of journals including
Journal of Advertising, International Journal of Advertising, Journal of Women and Aging and
Journal of Services Marketing, among others.
Corresponding author: Mike Reid, School of Economics and Finance, RMIT University,
Level 11, Building 80, 445 Swanston Street, Melbourne, Australia.
T +613 9925 1474
E mike.reid@rmit.edu.au
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Peter Thompson is a Lecturer of Marketing in the Department of Marketing, Monash

University. His primary research interests include branding, consumer behaviour, sales promo-
tion, sport marketing and marketing communications. He has published in the Journal of the
Academy of Marketing Science and Accounting Education. He is completing a PhD in the area
of brand fit and has also co-authored several books on the Melbourne Cup and Phar Lap.
Felix Mavondo is Professor of Marketing in the Department of Marketing, Monash University.
His primary research interests include marketing strategy, market orientation, relationship
marketing, retailing and agribusiness. He has published in many journals including Journal of
International Business Studies, Journal of Business Research, Industrial Marketing Management,
European Journal of Marketing, Journal of International Marketing, Journal of Advertising,
Journal of Travel Research, Decision Science and Journal of Marketing Management, among
others.
Karen Brunsø is Head of Department and Professor at the Department of Business
Administration, Aarhus School of Business. Her research interests include consumer behaviour,
cross-cultural marketing and market research and lifestyle analysis. Her focus is very strongly
on the food industry and consumers. She has published widely in such journals as British Food
Journal, European Journal of Marketing, Appetite, Journal of Consumer Behaviour, Food
Quality and Preference, Journal of Retailing and Consumer Services and Journal of Business
Research, among others.