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| Author: | Park, J.H. MacLachlan, D.L. Love, E. |
| Title: | New product pricing strategy under customer asymmetric anchoring |
| Journal: | International Journal of Research in Marketing
2011 : DEC, VOL. 28:4, p. 309-318 |
| Index terms: | pricing strategy mathematical models |
| Freeterms: | willingness to pay anchoring mechanisms |
| Language: | eng |
| Abstract: | This article presents an anchoring mechanism model for determining the effect of observing a posted price on a potential customer's willingness to pay (WTP) for a new product. With theoretical arguments and mathematical proof, it is shown that pricing higher yields optimal results if customers use an asymmetric WTP anchoring mechanism. According to experimental evidence, an asymmetric anchoring mechanism may very well be involved in purchase decisions. |
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