Product information and consumer choice confidence in multi-item sales promotions

Journal of Retailing and Consumer Services 28 (2016) 45–53

Contents lists available at ScienceDirect

Journal of Retailing and Consumer Services journal homepage: www.elsevier.com/locate/jretconser

Product information and consumer choice confidence in multi-item sales promotions Demetra Andrews n School of Business and Economics, Indiana University Northwest, Dunes Professional Building 3400 Broadway, Gary IN 46408, USA

art ic l e i nf o

a b s t r a c t

Article history: Received 8 July 2014 Received in revised form 25 July 2015 Accepted 27 July 2015

This research augments efforts to produce a richer understanding of the drivers of consumer choice confidence. It examines the interplay between two marketing interventions that consumers encounter in retail marketplaces, diagnostic product information and multi-item sales promotions. Results indicate that the influence of product information varies as a function of sales promotion format. The information effect is weaker when consumers are allowed to select the products that will be included in the promotion. Perception of information adequacy is revealed as a mediator of the information diagnosticity effect. The implications for marketing theory and promotional strategy are discussed. & 2015 Elsevier Ltd. All rights reserved.

Keywords: Consumer choice confidence Information diagnosticity Multi-item sales promotion

1. Introduction Choice confidence plays a key role in determining how consumers think and act in purchase situations. Choice confidence reflects the extent to which a consumer perceives his or her choice decision to be correct (Heitmann et al., 2007; Petrocelli et al., 2007) and believes he/she is in control of a choice situation (Nataraajan and Angur, 1998). Consumers who are confident in a choice decision exhibit increased willingness-to-pay (Thomas and Menon, 2007), higher purchase intention (Laroche et al., 1996) faster purchase speed (Greenleaf and Lehmann, 1995), stronger choice commitment (Clarkson et al., 2008), and higher satisfaction (Heitmann et al., 2007). In short, a consumer who is confident in his or her choice decision is likely a good customer. Given its broad influence, researchers have sought to illuminate the causes of this psychological state. Their efforts revealed an important influence of external information (Kahneman and Tversky, 1973; Oskamp, 1965; Rucker et al., 2014) and highlighted the role of diagnostic information (Tsai and McGill, 2011; Yoon and Simonson, 2008). Diagnostic information helps consumers to distinguish between choice alternatives and arrive at a decision (Griffin and Tversky, 1992; Lynch et al., 1988). Despite evidence of a persistent influence of information diagnosticity on choice confidence, generalization of these findings to retail contexts likely requires additional study. Prior research has shown that the influence of information diagnosticity on choice confidence is n

Fax: þ 1 219 980 6916. E-mail address: [email protected]

http://dx.doi.org/10.1016/j.jretconser.2015.07.011 0969-6989/& 2015 Elsevier Ltd. All rights reserved.

susceptible to differences consumer perception of a choice task (Tsai and McGill, 2011). Retailers frequently employ sales promotions to motivate consumer purchase and sales promotions can alter consumer beliefs, feelings and evaluations (Raghubir et al., 2004). Therefore, it is possible that retail sales promotions may alter consumer response to information diagnosticity. To understand the influence of information diagnosticity in retail contexts, it is necessary to examine that influence in conjunction with sales promotions that are likely to be employed. The present research opens this line of inquiry by examining the influence of information diagnosticity as a function of different forms of a buy-one-getone-50% off (BOGO50) multi-item sales promotion (MIP). A multi-item sales promotion (hereafter, “MIP”) is a promotional activity in which more than one product1 is advanced with the goal of stimulating consumer purchasing behavior (Foubert and Gijsbrechts, 2010). In recent years, manufacturers have demonstrated a preference for MIPs over single-item sales promotions because MIPs offer greater opportunity for promotion coordination MIPs (Reyes, 2002). Variants of MIP have emerged that may elicit different reactions from consumers. The present research examines the influence of information diagnosticity as a function of the choice freedom the MIP affords the consumer and whether the promotional benefit is applied immediately or delayed for some period of time. The present research seeks to contribute to marketing knowledge in at least three ways. It offers a refinement of theory 1 In the present research, the term “product” is used to refer to a tangible good or a service.

46

D. Andrews / Journal of Retailing and Consumer Services 28 (2016) 45–53

regarding the relationship between information diagnosticity and choice confidence that may facilitate its application to retail contexts. It responds to a stated need for deeper understanding of the mechanisms involved in consumer response to MIPs (Ailawadi et al., 2009) and to sales promotions in general (Laroche et al., 2003). It also stands to inform managerial forecasts of consumer response to MIPs under different conditions of product information. This paper proceeds as follows. First, a conceptual framework is provided. Following that, theories of choice conflict and tradeoff difficulty are employed to frame the hypotheses. Findings from two experiments are then reported. Finally, the implications of the findings for marketing theory and practice are discussed.

2. Conceptual framework 2.1. Choice confidence Choice confidence reflects the certainty with which a consumer holds an attitude toward a choice decision (Rucker et al., 2014). It is distinguishable from general consumer confidence, which focuses on belief in the stability or growth of the economy (Marrell et al., 2004). Many of drivers of choice confidence reflect types (direct experience vs. encountered, external vs. internal) or qualities (quantity, consistency, ease-of-processing, importance, comprehensiveness, source credibility, validity) of external information (Rucker et al., 2014). Choice confidence is generated via metacognitions about the information that supports a choice decision (Tsai and McGill, 2011). In the absence of diagnostic external information, choice confidence relies on intuitions, inferences, and subjective evaluations (Hammond, 1996). Briñol et al. (2007) demonstrate that choice confidence is also influenced by emotions such that happiness (sadness) leads to higher (lower) confidence, but only when consumers are motivated to think deeply about a related task. 2.2. Information diagnosticity External information is considered diagnostic when it is adequate for a specific choice task (Nagpal et al., 2011) and enables the consumer to distinguish between choice alternatives and arrive at a decision (Lynch et al., 1988; Menon et al., 1995). Diagnostic information may be characterized by greater quantity (Peterson and Pitz, 1988), extreme values, high validity (Griffin and Tversky, 1992), or uniqueness (Huber et al. 1982). The present research relies on three of these characteristics to operationalize information diagnosticity: information quantity, information extremity, and uniqueness of descriptive information. Prior research has demonstrated a persistent and positive influence of information diagnosticity on choice confidence. This effect is particularly evident when one choice alternative asymmetrically dominates others in a choice set. When one alternative is superior to others in a choice set the “correct” choice becomes transparent to the consumer (Yoon and Simonson, 2008), reducing the need to make difficult trade-offs between choice alternatives and, consequently, the effort needed to arrive at a choice decision (Amir and Levav, 2008). 2.3. Selection freedom and incentive timing An MIP is a promotional activity in which more than one product is advanced at the same time (Foubert and Gijsbrecht, 2010). MIPs afford marketers greater opportunity to focus on categoryand store-level performance objectives (Ailawadi et al., 2009). Fixed-selection MIPs feature a combination of products that is selected by the manufacturer or retailer. To take advantage of the

promotion, the consumer is required to accept the pre-selected combination and purchase the required quantity of product. Freeselection MIPs empower consumers to select their own combination of promoted products from a larger choice set that is defined by the manufacturer or retailer (Foubert and Gijsbrecht, 2010). A second characteristic of MIPs that is of interest to the present research is incentive timing. Front-loaded promotions offer immediate benefit (e.g., “redeem at checkout”), while rear-loaded promotions provide a benefit at some future point in time (e.g., “redeem on your next purchase”) (Zhang et al., 2000). Prior research suggests that delayed incentives exert positive influence on product attractiveness (Soman, 1998). This effect is argued to manifest because of consumers’ inability to forecast the difficulties associated with redeeming the incentives in the future. Some retailers have replaced immediate incentive with delayed incentive MIPs in an effort to reduce waste (Wells, 2009).

3. Hypotheses Theories of choice conflict and tradeoff difficulty provide a framework for development of hypotheses. The need to make tradeoffs between (or forego) attractive features of unique choice alternatives can give rise to feelings of difficulty which will make it hard for consumers to arrive at a choice decision (Luce et al., 1999). Feelings of difficulty signal problems with the decision process and undermine the confidence with which the choice decision is ultimately held (Tsai and McGill, 2011). Highly diagnostic information simplifies choice decisions by providing cues that make the best choice alternative more apparent to the consumer (Amir and Levav, 2008). This reduces choice conflict (Tversky and Shafir, 1992) because it eliminates the need to make difficult tradeoffs that would undermine choice confidence. This leads to the first hypothesis. H1: Choice confidence will be higher when information is high in diagnosticity than when it is low in diagnosticity. This research proposes that perception of information adequacy mediates the influence of information diagnosticity on choice confidence. Perception of information adequacy reflects the extent to which the consumer believes external information to be sufficient for the choice task (Nagpal et al., 2011). External information is the first source of information that informs choice confidence (Hammond, 1996; Tsai and McGill, 2011). If external information is believed to be sufficient for the choice task, that information should also be sufficient to support confidence that the choice decision is correct. H2: Perception of information adequacy will mediate the influence of information diagnosticity on choice confidence. As discussed earlier, MIPs can vary in terms of selection freedom. In a fixed-selection MIP, the consumer’s choice is restricted to a predetermined combination of products. To take advantage of the promotion, the consumer must forego the combinations in potentia that he/she could have constructed. Prior research has shown that restrictions can promote systematic (as opposed to heuristic) processing of information (Bahn and Boyd, 2014). Systematic processing of information is more likely than heuristic processing to increase the salience of choice tradeoffs and give rise to feelings of difficulty that can undermine choice confidence. In contrast, a free-selection MIP allows the consumer to select multiple products and, thereby, reduce or avoid tradeoffs (Lazarus, 1991) and their negative influence on choice confidence. H3a: Choice confidence will be higher with a free-selection MIP than with a fixed-selection MIP. In addition to its main effect (proposed in H3a) selection

D. Andrews / Journal of Retailing and Consumer Services 28 (2016) 45–53

freedom is also expected to moderate the influence of information diagnosticity on choice confidence. Because a free-selection MIP allows selection of multiple products, the imperative to identify the single “best” choice alternative in a set is reduced. Correspondingly, the usefulness and influence of diagnostic information that highlights the “best” choice is expected to be lower under conditions of free-selection. In contrast, a fixed-selection MIP locks a consumer into a purchase of at least two different products. The higher level of commitment required by fixed-selection MIPs is anticipated to be associated with greater influence of diagnostic information that can justify the required level of commitment. H3b: The influence of information diagnosticity on choice confidence will be moderated by selection freedom such that the influence of information diagnosticity will be stronger under a fixed-selection MIP format than under a free-selection MIP format. As part of this research effort, the mediating potential of affecttoward-the-choice was evaluated. Consumers may experience feelings of ease (or difficulty) when attempting to make a choice decision using information that is high (or low) in diagnosticity. In turn, these feelings can alter choice confidence (Tsai and McGill, 2011). The opportunity for exploration is one characteristic of the affective route of promotional influence (Raghubir et al., 2004). Employment of a free-selection MIP format offers greater opportunity to explore product alternatives than does a fixed-selection MIP format. In this fashion, employment of free- vs. fixed-selection MIP formats may engender differences in the affective route of promotional influence. Such differences in the affective influence of promotions may, then, yield differences in choice confidence. These propositions are summarized below. H4a: Affect-toward-the-choice will mediate the influence of information diagnosticity on choice confidence. H4b: Affect-toward-the-choice will mediate the influence of selection freedom on choice confidence.

4. Experiment 1 A scenario about purchase of a disposable digital camera was developed. The multi-attribute nature of digital cameras makes them well-suited for the manipulations of information quantity and quality required for this study. A similar scenario employing digital cameras (not disposable) was successfully employed in recent research on choice confidence (see Dhar, 1997; Andrews, 2013). Describing the cameras as “single-use” provided a rationale for the purchase of multiple items. The MIP was described as delayed incentive because it was deemed more realistic that additional single-use cameras would be purchased as the need arose, rather than all at once. The operationalization of information diagnosticity was similar to that employed in prior research (Tsai and McGill, 2011). The scenario focused on selection of a single product from a set of three (Amir and Levav, 2008; Yoon and Simonson, 2008). High information diagnosticity was operationalized as a completed matrix of product information in which one choice alternative was superior to the other two. Since missing information is common to choice situations (Kivetz and Simonson, 2000), low information diagnosticity was operationalized as an incomplete matrix in which no dominant alternative was obvious. To eliminate potential confounds due to brand preference, choice alternatives were identified by letters rather than brand names. The scenario also employed free- and fixed-selection formats of a widely-employed MIP. A recent study reported that approximately three-quarters of consumers have used a buy-one-get-one50% off (BOGO50) promotion (Shopper Response to BOGO/ free promotions, 2012). BOGO50 promotions are employed in

47

many product categories including clothing and accessories, vitamin supplements, hair and skin care products, food, vacations, restaurant meals, entertainment options. Thus, it was expected that study participants would be familiar with this type of promotion. 4.1. Design and procedure One hundred ten undergraduate business students attending a university in the southcentral U.S. voluntarily participated in an online study in exchange for partial course credit. The study employed a 2 (Information Diagnosticity: high vs. low)  2(MIP format: free-selection vs. fixed-selection), 4-cell, between-subjects design. Upon signing into the study, participants were randomly assigned to a condition. Participants were provided the following directions. “Imagine that you have been selected as one of the new university ambassadors2. This means that you will spend the next year traveling around the world to promote the university. You really want to capture these once-in-a-lifetime memories, but don’t want to risk taking an expensive camera with you. You decide to purchase a disposable digital camera to take on the trip.” Next, participants assigned to the free-selection (fixed-selection) condition were provided the following information. “A store you like has a special offer on disposable cameras. With each disposable camera you purchase, you will get 50% off your next purchase of ANY BRAND (THE SAME BRAND) of disposable digital camera.” Next, the matrices of camera information were presented and participants were asked to indicate their selection (see Appendix A). As in prior research, participants responded to measures of choice confidence after making a selection (Tsai and McGill, 2011). The confidence measures were similar to those used in prior research (see Heitmann et al., 2007; Petrocelli et al., 2007). The measures were, “I felt absolutely certain I knew which camera to select,” and “I felt completely confident in making a selection.” A single item assessed perceived adequacy of presented information, “I did not have enough information to make a decision.” A single item capturing ability to distinguish between the choice alternatives served as a check of the information diagnosticity manipulation, “I could not see any differences between the cameras.” These four items were assessed via seven-point, Likert-type scale items anchored by “(1) Strongly disagree” and “(7) Strongly agree”. The items measuring perception of information adequacy and the manipulation check were reverse-coded for analysis. Three items were employed to evaluate affect-toward–the-choice, “I found the choice task to be unpleasant/pleasant”, “This task was one that I disliked very much/liked very much”, and “This choice left me with a bad feeling/left me with a good feeling,” (Kim et al., 1996). The three affect measures were assessed via a 7-point semantic differential scale items. 4.2. Results Manipulation check. ANOVA revealed a significant influence of information diagnosticity on ability to distinguish between the choice alternatives (F(1, 108)¼ 4.42, p ¼0.04, ηp2 ¼0.040). High diagnosticity yielded greater perception of differences among the choice alternatives (M ¼2.93) than did low diagnosticity (M ¼2.27), suggesting that the manipulation of information diagnosticity operated as intended. Influence on choice confidence. The alpha coefficient for the two 2 At the time of the study, the university in question was actively recruiting University Ambassadors, so students were familiar with the role.

48

D. Andrews / Journal of Retailing and Consumer Services 28 (2016) 45–53

Table 1 Summary Statistics and Study Results Summary Statistics

Experiment 1 n

High Diagnosticity Free-selection Fixed-selection Low Diagnosticity Free-selection Fixed-selection Free-selection Fixed-selection Immediate Incentive Delayed Incentive Correlations Info. Adequacy Affect ANOVA Results Outcome: Choice Confidence Effects Overall Model Info. Diag. Selection Freedom Info n Selection Fredom Incentive Timing Deal Proneness Involvement Residual Number of Observations Adjusted R2

Experiment 2 mean Choice 5.53 5.56 5.43 4.87 5.35 4.38 5.45 5.00

std. dev. Confidence 1.15 1.08 1.22 1.32 1.18 1.30 1.12 1.37

Confidence .41nn .41nn

Info. Adeq.

df

FValue

ηp2

B

3 1 1 1

5.66nnn 8.58nnn 4.78n 4.06n

0.140 0.075 0.043 0.037

58 27 31 52 26 26 53 57

n

mean Choice 5.53 5.3 5.12 4.87 3.72 3.03 4.52 4.06 4.42 4.16 Confidence .69nn .37nn

std. dev. Confidence 1.15 1.34 1.33 1.32 1.78 1.43 1.75 1.73 1.77 1.74 Info. Adeq.

df

FValue

ηp2

B

4.39 1.13 0.96 -0.92

4 1 1 1 1 1 1 287 297 0.36

19.01nnn 126.93nnn 8.03nn 4.12n 3.87n 4.87n 18.94nnn

0.374 0.307 0.027 0.014 0.013 0.017 0.062

1.47 1.59 0.97 -0.78 -0.36 0.22 0.26

Error df

Pillai's Trace

F

df

Error df

49.55nnn 7.66† 0.065† 2.51† 11.85nnn 14.27nnn FValue 97.23nnn 17.73nnn

2.00 2.00 2.00 2.00 2.00 2.00 ηp2 0.253 0.058

286.00 286.00 286.00 286.00 286.00 286.00

se

t

0.49 0.05 0.21 0.19 0.28 0.07 0.09 0.05

-1.11 10.78nnn 5.86nnn 3.73nnn -2.22n 1.27† 1.16† 3.24nn

se 0.21 0.21

t 5.86nnn 3.00nn

Boot SE 0.14 0.04

Boot LLCI 0.6589 -0.0222

148 75 73 149 74 75 149 148 148 149

.49nn

106 110 0.11

MANOVA Results Pillai's Trace F df Outcomes: Perception of Info. Adequacy and Affect-toward-the-Choice Multivariate Tests Info. Diag. 0.055 3.04n 2.00 Selection Freedom 0.034 1.85† 2.00 † n Info Selection Fredom 0.033 1.82 2.00 Incentive Timing Deal Proneness Involvement Between-Subjects Effects df FValue ηp2 Info. Diag -Info Adeq. 1 6.00n 0.054 Info. Diag -Affect 1 2.08† 0.019

105.00 105.00 105.00

0.257 0.005 0 0.017 0.077 0.091 df 1 1

Mediation Analysis coeff. se t coeff. Outcome: Choice Confidence constant 3.14 0.54 5.81nnn -0.54 Info Adeq. 0.22 0.06 3.66nnn 0.52 Info Diag. 0.23 0.11 2.13n 1.23 Selection Freedom 0.16 0.07 2.18n 0.66 † n Info Selection Fredom -0.15 0.11 1.55 -0.61 † Affect 0.31 0.11 -1.38 0.08 Deal Proneness 0.1 Involvement 0.17 Direct and Indirect Effects Conditional direct effect of Information Diagnosticity on Choice Confidence at Levels of the Moderator Effect se t Effect Fixed-Selection 0.86 0.31 2.77nn 1.23 † Free-Selection 0.10 0.31 0.33 0.62 Indirect effect of Information Diagnosticity on Choice Confidence Effect Boot SE Boot LLCI Boot ULCI Effect Info. Adequacy 0.06 0.04 0.0036 0.1887 0.87 Affect 0.04 0.03 -0.0021 0.1429 0.04 nnn

p o.001, po 0.01, p o.05, n.s.

nn n

†

.38nn

Boot ULCI 1.2233 0.1302

D. Andrews / Journal of Retailing and Consumer Services 28 (2016) 45–53

items measuring choice confidence was .83, suggesting that the items have relatively high internal consistency. Therefore, they were averaged together for analysis. An ANOVA was conducted. The dependent variable was choice confidence. The independent variables were information diagnosticity and selection freedom. Significant main effects of information diagnosticity and selection freedom were observed (See Table 1). High diagnosticity yielded higher choice confidence (M¼ 5.53) than did low diagnosticity (M ¼4.87), which provides support for H1. The scenario employing the free-selection MIP format yielded higher choice confidence (M ¼5.45) than did the scenario employing the fixed-selection MIP format (M ¼5.00), which is in line with H3a. The main effects were qualified by a significant interaction between information diagnosticity and MIP format (See Table 1) congruent with H3b, the influence of information diagnosticity was moderated by MIP format such that the influence of information diagnosticity on choice confidence was stronger when a fixed-selection MIP was described than when a free-selection MIP was described (See Fig. 1). Mediation Analysis. The alpha coefficient for the three items measuring affect-toward-the-choice was 0.84 suggesting that the items have relatively high internal consistency. Therefore, they were averaged together for analysis. A significant correlation between affect-toward-the-choice and perception of information adequacy was observed (r ¼0.49) (See Table 1). It was suspected that these two variables might vary along a common dimension related to feeling comfortable, or at ease, with the choice task. Therefore, the two variables were subjected to a MANOVA in which information adequacy and promotion selection freedom were predictors. Using Pillai's Trace, there was a significant effect of information diagnosticity (p ¼0.052) (See Table 1.) Neither the influence of selection freedom (p ¼0.162) nor the interaction between information diagnosticity and selection freedom (p ¼0.168) was significant. These nonsignificant results did not provide support for H4b. Between-subjects tests revealed a significant influence of information diagnosticity on perception of information adequacy (p ¼0.02), but not on affect-toward-the-choice (p¼ 0.15). A mediation analysis was conducted in SPSS to evaluate Model 5 with the PROCESS command (Hayes, 2012). Information diagnosticity, choice confidence, perception of information adequacy, and selection freedom were input as the independent, dependent, mediating, and moderating variables, respectively. Affect was also included as potential mediator. As shown in Table 1, perception of information adequacy partially mediated the influence of information diagnosticity on choice confidence. This finding provides support for H2. However, no support was obtained for H4a.

5. Discussion Findings from Experiment 1 are congruent with literature that asserts a positive influence of information diagnosticity on choice confidence. Additionally, the current findings suggest that the influence of information diagnosticity may be partially mediated by perceptions of the adequacy of presented information for the choice task. Results from this study also suggest that a fixed-selection MIP may generate higher choice confidence than a freeselection MIP and that a free-selection MIP may weaken the influence of information diagnosticity on choice confidence. Contrary to H4, affect did not appear to mediate the MIP format effect. There were some limitations in the design of Experiment 1 that will be addressed in Experiment 2. Experiment 1 did not include a check of the selection freedom manipulation. This makes it unclear whether the observed effects of different MIP formats was caused by differences in perceived selection freedom or some other factor. The focus on disposable digital cameras (arguably, a specialty

49

good) may limit generalizability of the findings. Additionally, the influence of other possible factors that might influence the results (such as deal proneness or involvement) will be assessed in Experiment 2. While the delayed incentive format employed in Experiment 1 was deemed necessary for realism, it is possible that this format introduced a confound. Prior research suggests that delayed incentives are more attractive than immediate incentives (Soman, 1998). In the present research, such an effect might have artificially inflated measures of affect-toward-the-choice, and possibly, choice confidence. This possibility was evaluated in Experiment 2.

6. Pretest Multivitamins was selected as the focal product for Experiment 2 because it was observed that drugstores/pharmacies frequently employ BOGO50 promotions in this category. A pretest was conducted to evaluate the efficacy of the manipulations of information diagnosticity and selection freedom in the multivitamin category. The study employed 2 (information diagnosticity: high vs. low)  2 (selection freedom: high vs. low), between-subjects design. Forty participants were solicited via an online service and were randomly assigned to a condition. Results revealed higher perception of information adequacy when information diagnosticity was high (M ¼5.30) vs. low (M ¼3.30, p ¼0.0001) and stronger belief that the promotion offered choice freedom when selection freedom was high (M¼ 5.65) vs. low (M¼ 4.65, p ¼0.028). Based on these results, it was deemed appropriate to employ multivitamins as the focal product for Experiment 2.

7. Experiment 2 7.1. Design and procedure Information diagnosticity was operationalized in a fashion similar to that employed in Experiment 1. In the high information diagnosticity condition, Brand B was rated superior to the other two choice alternatives and offered more forms of the product. In the low diagnosticity condition, the featured products were equivalent in terms of product attributes and overall ratings. To increase validity, the real names of reviewing organizations were used in the stimuli. Selection freedom was, again, manipulated by either restricting choice to a single brand or allowing the selection of multiple brands. Information regarding the delayed vs. immediate incentives was presented to participant in the form of two written statements indicating that the promotional discount would either be applied at checkout (immediate) or on the participant's next purchase (delayed) (See Appendix A). Two hundred ninety-seven adults living in the United States were recruited via the Mechanical Turk online system offered by Amazon.com. Forty-eight percent of participants were female. The average reported age and income were 37 and $40,700/year, respectively. Approximately, 80% of participants were Caucasian, with African–Americans (7.7%) and Asian American (6.1%) comprising an additional 14%. Nearly 66% reported having attained a college degree. Participants were compensated $1.25 for completing the study that was offered online using Qualtrics. The study employed a 2 (Information Diagnosticity: high vs. low)  2 (MIP format: free-selection vs. fixed-selection)  2 (incentive timing: immediate vs. delayed), 8-cell, between-subjects design. Upon signing into the study, participants were instructed to answer all questions in the survey and to provide reasonable and appropriate answers to all questions. Following this, participants completed measures assessing deal proneness (Lichtenstein et al.,

50

D. Andrews / Journal of Retailing and Consumer Services 28 (2016) 45–53

1995) and involvement with the multivitamin category (Chandrasekaran, 2004) that were adapted from existing scales (See Appendix B). Next, participants were randomly assigned to a condition and the study stimuli were presented. Next, participants responded to measures assessing choice confidence, affect-toward-the-choice, perception of information adequacy, perception of selection freedom, recall of incentive timing, and several measures unrelated to the present study. Finally, participants provided demographic information and submitted their responses. The measures of choice confidence, perception of information adequacy, affect-toward-the-choice, and the manipulation checks assessing ability to distinguish between the choice alternatives were the same as in Experiment 1. A single item was employed as a check of the selection freedom manipulation, “The buy-one-getone-50% off promotion on brands of multivitamins that I viewed in this study restricted my choice options (gave me choice freedom),” was measured using a 7-point semantic differential scale. A multiple choice item was employed to evaluate the salience of the incentive timing manipulation, “The buy-one-get-one-50% off promotion on brands of multivitamins that I viewed in this study was redeemable at checkout (on my next purchase).” 7.2. Results Manipulation checks. Separate ANOVAs were conducted on the items serving as manipulation checks. The information diagnosticity manipulation exerted a significant influence on ability to distinguish between the choice alternatives (F(1, 295) ¼99.34, p ¼0.001, ηp2 ¼0.252). High diagnosticity yielded greater ability to discern differences (M ¼4.98) than did low diagnosticity (M ¼3.05). The selection freedom manipulation exerted a significant influence on perception of selection freedom (F(1, 295) ¼ 34.41, p ¼0.001, ηp2 ¼ 0.110), such that free-selection yielded higher perception of selection freedom (M¼5.70) than fixed-selection (M ¼4.57). All participants in the immediate incentive condition correctly identified their incentive timing (n ¼ 148). Approximately 97% of participants in the delayed incentive condition (145 out of n ¼149) correctly identified their incentive timing condition when asked. Influence on choice confidence. The alpha coefficient for the two items measuring choice confidence was 0.99, suggesting that the items have high internal consistency. Therefore, they were averaged together for analysis. An ANOVA was conducted. The dependent variable was choice confidence. The independent variables were information diagnosticity and selection freedom. Significant main effects of information diagnosticity and selection freedom were observed (See Table 1). High diagnosticity yielded higher choice confidence (M¼ 5.53) than did low diagnosticity (M ¼4.87), which provides support for H1. The free-selection MIP format yielded higher choice confidence (M¼ 5.45) than did the fixed-selection MIP format (M¼5.00), which supports H3a. Additionally, a significant influence of incentive timing was observed. However, it was in the opposite direction of that posited in prior research. Specifically, the delayed incentive (such as that employed in Experiment 1) depressed choice confidence rather than increased it (delayed: M ¼4.16 vs. immediate: M¼4.42). The main effects were qualified by a significant interaction between information diagnosticity and selection freedom (See Table 1) H3b, proposes that a stronger influence of information diagnosticity will be observed when a fixed-selection MIP format is employed than when a free-selection format is employed. Congruent with this hypothesis, the influence of information diagnosticity on choice confidence was moderated by selection freedom such that the size of the effect attributable to information diagnosticity was larger under fixed-selection (ηp2 ¼0.4) than under

free-selection ( ηp2 ¼ 0.2) (See Fig. 2). Specifically, employment of a fixed-selection MIP format yielded an effect size of information diagnosticity that was twice as large as that produced under freeselection format. Mediation Analysis. The alpha coefficient for the three items measuring affect-toward-the-choice was .99, suggesting that the items have high internal consistency. Therefore, they were averaged together for analysis. For the reasons described in Experiment 1, affect-toward-the-choice and perception of information adequacy were, again, subjected to MANOVA. As shown in Table 1, using Pillai's Trace, there was a significant effect of information diagnosticity. The effects of selection freedom, incentive timing, and the interaction between information diagnosticity and selection freedom were not significant. The nonsignificant effect of selection freedom provides no support for H4b. Between-subjects tests revealed a significant influence of information diagnosticity on perception of information adequacy and affect-toward-thechoice. A mediation analysis was conducted in SPSS to evaluate Model 5 with the PROCESS command (Hayes, 2012). Information diagnosticity, choice confidence, and selection freedom were the independent, dependent, and moderating variables, respectively. As in Experiment 1, perception of information adequacy and affecttoward-the-choice were evaluated as possible mediators. Deal proneness and involvement were included in the model as covariates. As shown in Table 1, perception of information adequacy partially mediated the influence of information diagnosticity on choice confidence. This provides support for H2. The mediation effect of affect-toward-the-choice was not significant. Thus, no support was obtained for H4a.

8. Discussion In a typical marketplace, multiple marketing interventions are employed simultaneously. To better understand and predict consumer response to marketing initiatives, it is important to investigate the nature of interactions between marketplace factors. In this light, the joint influence of information diagnosticity and promotion selection freedom on consumer choice confidence was examined in the present research. In so doing, this research augments efforts to develop a more comprehensive theory of choice confidence, extends research into the mechanisms of consumer response to sales promotions, and provides information that stands to inform promotion strategy. Findings from two experimental studies demonstrate a positive influence of highly diagnostic product information on choice confidence that is congruent with evidence presented in previous research. A new insight that is offered by the present research effort is that the influence of diagnostic information, specifically information that highlights a superior choice alternative, is attenuated in the presence of a free-selection MIP. In contrast, when the set of promoted products is fixed by the marketer, the positive influence of information diagnosticity is observed. These findings are consistent with the proposition that restrictions promote systematic information processing (Bahn and Boyd, 2014). When consumer selection is restricted to a predetermined set of promoted items, the need to justify the decision to partake in the promotion may increase reliance on the diagnosticity of external information. However, when the consumer is free to make his or her own product selections, the ability to select multiple products may reduce the value of diagnostic information that highlights the single “best” choice alternative. These findings stand to inform promotion strategy. They suggest that, in categories that are not characterized by single superior or dominant brand or product,

D. Andrews / Journal of Retailing and Consumer Services 28 (2016) 45–53

51

free-selection MIPs may be more likely to engender choice confidence (and its desirable consequences) than fixed-selection MIPs. Although prior research demonstrated an attraction effect of delayed incentive promotions, evidence from Experiment 2 reveals a negative influence of a delayed incentive on choice confidence. At a molecular level, this finding provides some assurance that the results from Experiment 1 may not have been inflated by the use of a delayed-incentive promotion. Rather, the observed effect in Experiment 1 may have occurred despite the confidencedepressing influence of the delayed incentive. At a molar level, the finding presents the possibility that attempting to incorporate unknown future states or behaviors into metacognitions about current choices may undermine choice confidence. This research provides empirical evidence that the influence of external information diagnosticity on choice confidence is partially mediated by perceptions of the adequacy of the information to support a choice decision. Moreover, the mediation analysis in Experiment 2 suggests that, although diagnostic information does significantly increase affect-toward-the-choice, affect does not function as a mediator of the information diagnosticity effect. In other words, although people feel better when making a choice decision using information that is higher in diagnosticity (Maffect High ¼5.49) in diagnosticity than lower in diagnosticity (Maffect Low ¼4.98), the positive feelings may not translate into greater confidence about the outcome of the choice process.

effort focused on a single form of MIP, the BOGO50, which can be classified as a price promotion. It is possible that the patterns of influence observed in this research may be different for non-price promotions. Finally, while one mediator was identified, it is clear that others are still to be discovered. Development of a comprehensive understanding of the causes of choice confidence will be served by further investigation. These questions may provide fruitful avenues for future research.

9. Limitations and directions for future research

The store is running a Buy-one-get-one-50% off! sales promotion on three brands of multivitamins.

A limitation of this research is that the choice set was limited to three alternatives. While this format has been successfully employed in previous research (Amir and Levav, 2008; Yoon and Simonson, 2008), most product categories contain far more than three viable choice alternatives. It is unknown whether the positive influence of free-selection on choice confidence will be offset by uncertainty engendered by choice overload. This first research

Acknowledgments This research effort was partially funded by the School of Business and Economics at Indiana University Northwest. The author thanks three anonymous reviewers for providing detailed and actionable feedback on that served to increase the contribution of the research.

Appendix A. : Samples of Experimental Stimuli Low Information Diagnosticity Condition (Experiment 1) High Information Diagnosticity Condition (Experiment 1) High Information Diagnosticity, Free-selection, Immediate Incentive (Experiment 2)

If you buy one brand of multivitamin today, you will receive 50% off a second bottle of ANY BRAND at checkout. Each of the brands has been rated by independent reviewing organizations. The available ratings are listed below. Please take your time and review the information about the brands of multivitamin that are on promotion.

52

D. Andrews / Journal of Retailing and Consumer Services 28 (2016) 45–53

Appendix B. : Adapted Scales Involvement with the Product (Adapted from Chandrasekaran, 2004) 1. I am particularly interested in multivitamins. 2. Given my personal interests, multivitamins are not very

relevant to me (R). 3. Overall, I am quite involved when I am purchasing multivitamins for personal use. Deal Proneness (Adapted from Lichtenstein et al., 1995) 1. Promotions can save me a lot of money.

D. Andrews / Journal of Retailing and Consumer Services 28 (2016) 45–53

2. “Buy-one-get-one-50% off” promotions can save a shopper a lot of money. 3. When I take advantage of a “buy-one-get-one-50% off” offer, I feel good. 4. When I buy a product with a “buy-one-get-one-50% off” offer, I feel that I am getting a good deal.

References Ailawadi, K.L., Beauchamp, J.P., Donthu, N., Gauri, D.K., Shankar, V., 2009. Communication and promotion decisions in retailing: a review and directions for future research. J. Retail. 82 (1), 42–55. Amir, O., Levav, J., 2008. Choice construction versus preference construction: the instability of preferences learned in context. J. Mark. Res. 45 (2), 145–158. Andrews, D., 2013. The interplay of information diagnosticity and need for cognitive closure in determining choice confidence. Psychol. Mark. 30 (9), 749–764. Bahn, K.D., Boyd, E., 2014. Information and its impact on consumers’ reactions to restrictive return policies. J. Retail. Consum. Serv. 21 (4), 415–423. Briñol, P., Petty, R.E., Barden, J., 2007. Happiness versus sadness as a determinant of thought confidence in persuasion: a self-validation analysis. J. Personal. Soc. Psychol. 93 (5), 711–727. Chandrasekaran, R., 2004. The influence of redundant comparison prices and other price presentation formats in consumer’s evaluations and purchase intentions. J. Retail. 80 (1), 53–66. Dhar, R., 1997. Consumer preference for a no-choice option. J. Consum. Res. 24, 215–231, September. Clarkson, J.J., Tormala, Z.L., Rucker, D.D., 2008. A new look at the consequences of attitude certainty: the amplification hypothesis. J. Personal. Soc. Psychol. 95 (4), 810–825. Foubert, B., Gijsbrechts, E., 2010. Please or Squeeze? Brand performance implications of constrained and unconstrained multi-item promotions. Eur. J. Oper. Res. 202 (3), 880–892. Greenleaf, E.A., Lehmann, D.R., 1995. Reasons for substantial delay in consumer decision making. J. Consum. Res. 22, 186–199, September. Griffin, D., Tversky, A., 1992. The weighing of evidence and the determinants of confidence. Cogn. Psychol. 24 (3), 411–435. Hammond, K.R., 1996. Human Judgment and Social Policy: Irreducible Uncertainty, Inevitable Error, Unavoidable Injustice. Oxford University Press, New York, NY. Hayes, A.F., 2012. PROCESS: A versatile computational tool for observed variable mediation, moderation, and conditional process modeling [White paper]. Retrieved from 〈http://www.afhayes.com/public/process2012.pdf〉. Heitmann, M., Lehmann, D.R., Herrmann, A., 2007. Choice goal attainment and decision and consumption satisfaction. J. Mark. Res. 44 (2), 234–250. Huber, J., Payne, J.W., Puto, C., 1982. Adding asymmetrically dominated alternatives: violations of the regularity and similarity hypothesis. J. Consum. Res. 9 (1), 90–98. Kahneman, D., Tversky, A., 1973. On the psychology of prediction. Psychol. Rev. 80 (4), 237–251. Kim, J., Allen, C.T., Kardes, F.R., 1996. An investigation of the mediational mechanisms underlying attitudinal conditioning. J. Mark. Res. 33 (8), 318–328.

53

Kivetz, R., Simonson, I., 2000. The effects of incomplete information on consumer choice. J. Mark. Res. 37 (4), 427–448. Laroche, M., Pons, F., Zgolli, N., Cervellon, M., Kim, C., 2003. A model of consumer response to two retail sales promotion techniques. J. Bus. Res. 56, 513–522. Laroche, M., Kim, C., Zhou, L., 1996. Brand familiarity and confidence as determinants of purchase intention: an empirical test in a multiple brand context. J. Bus. Res. 37 (2), 115–120. Lazarus, R.S., 1991. Progress on a cognitive-motivational-relational theory of emotion. Am. Psychol. 46 (8), 819–834. Lichtenstein, D.R., Netemeyer, R.G., Burton, S., 1995. Assessing the domain specificity of deal proneness: a field study. J. Consum. Res., 314–326. Luce, M.F., Payne, J.W., Bettman, J.R., 1999. Emotional trade-off difficulty and coping. J. Mark. Res. 36 (4), 143–159. Lynch, J.G., Marmorstein, H., Weigold, M.F., 1988. Choices from sets including remembered brands: use of recalled attributes and prior overall evaluations. J. Consum. Res. 15 (2), 169–184. Marrell, A., Davidsson, P., Garling, T., Laitila, T., 2004. Direct and indirect effects on households’ intentions to replace the old car. J. Retail. Consum. Serv. 11 (1), 1–8. Menon, G., Raghubir, P., Schwarz, N., 1995. Behavioral frequency judgments: an accessibility-diagnosticity framework. J. Consum. Res. 22 (2), 212–228. Nagpal, A., Khare, A., Chowdhury, T., Labrecque, L.I., Pandit, A., 2011. The impact of the amount of available information on decision delay: the role of common features. Mark. Lett. 22, 405–421. Nataraajan, R., Angur, M.G., 1998. Perceived Control in Consumer Choice: A Closer Look. In: Englis, Basil G., Olofsson, Anna (Eds.), Association for Consumer Research, Provo, UT, pp. 288–292. Oskamp, S., 1965. Overconfidence in case-study judgments. J. Consult. Psychol. 29 (3), 261–265. Peterson, D.K., Pitz, G.F., 1988. Confidence, uncertainty, and the use of information. J. Exp. Psychol. 14 (1), 85–92. Petrocelli, J.V., Tormala, Z.L., Rucker, D.D., 2007. Unpacking attitude certainty: attitude clarity and attitude correctness. J. Personal. Soc. Psychol. 92 (1), 30–41. Raghubir, P., Inman, J.J., Grande, H., 2004. The three faces of consumer promotions. Calif. Manag. Rev. 46 (4), 23–42. Reyes, S., 2002. Krafting the total promo package. Brandweek 43 (27), 24–28. Shopper response to BOGO/free promotions. AMG Strategic Advisors. n.p. February 2012. Web. Retrieved from 〈http://acosta.com/MediaCenterDetail.aspx? id¼ 10737418977andterms ¼ bogo〉. Soman, D., 1998. The illusion of delayed incentives: evaluating future effort-money transactions. J. Mark. Res. 35, 427–437, November. Rucker, D.D., Tormala, Z.L., Petty, R.E., Briñol, P., 2014. J. Consum. Psychol. 24 (1), 119–136. Thomas, M., Menon, G., 2007. When internal reference prices and price expectations diverge: the role of confidence. J. Mark. Res. 44 (3), 401–409. Tsai, C.I., McGill, A.L., 2011. No pain, no gain? How fluency and construal level affect consumer confidence. J. Consum. Res. 37 (5), 807–821. Tversky, A., Shafir, E., 1992. Choice under conflict: the dynamics of deferred decision. Psychol. Sci. 3 (6), 358–361. Wells, J., 2009. A better BOGO. Supermarket News. Winter.9. December 1, 2009. Yoon, S., Simonson, I., 2008. Choice set configuration as a determinant of preference attribution and strength. J. Consum. Res. 35 (2), 324–336. Zhang., Z.J., Krishna, A., Dhar, S.K., 2000. The optimal choice of promotional vehicles: front-loaded or rear-loaded incentives. Manag. Sci. 46 (3), 348–362.