Discounts or gifts? Not just to save money

Abstract

Purpose Decision theory holds that the ambiguity of decision information affects the choices of decision makers, who have the emotion of “ambiguity aversion” when making fuzzy decisions. The purpose of this paper is to explore the neural mechanism how the information ambiguity of different sales promotion strategies influences consumers’ purchasing decision. Design/methodology/approach The paper uses the event-related potential (ERP) technique and experiment. Findings Results indicate that the information ambiguity of sales promotion strategies did influence the purchasing decision of consumers, and there were significant differences in the amplitudes of brain wave P2, N2 and P3 when consumers encountered the sales promotions of different types (discounts and gift-giving). This reflects the difference in perceived risk, decision-making conflict and decision-making attitude. It means that compared with discounts, the perceived risk and difficulty increased while the decision-making confidence plunged when consumers were faced with gift-giving promotions. This finding gives an explanation on the neural level why consumers prefer discounts, rather gift-giving sales promotions. Practical implications For the merchants to promote commodities online, it is suggested that the actual benefit from the sales promotion should be specified to reduce the ambiguity of sales promotion information. As the neuromarketing develops, merchants have obtained more effective approaches to study marketing strategies. Originality/value One of the theoretical contributions this paper made is that the authors innovatively explored the consumer’s preference to online sales promotion strategies from the perspective of fuzzy decision. Second, the authors adopted the ERP technique to study the influence of the ambiguity of sales promotion information on the consumer’s purchasing behaviors. Third, this study provides an explanation for why consumers prefer the sales promotion type of discounts according to the neural mechanism of decision making.

Technological advancements and opportunities in Neuromarketing: a systematic review

“…ii. Activation of brain region due to marketing stimuli Soria Morillo et al [40], Chew et al [17], Cherubino et al [42], Soria Morillo et al [43], Çakar et al [34], Boksem and Smitds [57], Bhardwaj et al [58], Venkatraman et al [38], Touchette and Lee [21], Yang et al [45], Marques et al [22], Gong et al…”

“…iii. Neural response recording techniques EEG Soria Morillo et al [40], Yang et al [41], Chew et al [17], Cherubino et al [42], Soria Morillo et al [43], Yadava et al [18], Doborjeh et al [64], Çakar et al [34], Kaur et al [65], Baldo et al [19] For the purpose of Neuromarketing experiments, the following literatures selected right-handed participants, with normal or corrected-to-normal vision, free of central nervous system influencing medications and with no history of neuropathology.…”

“…Using the 3D shapes gave the authors an advantage to produce as many of 60 bracelet shapes to conduct the research on. Another new product was the E-commerce products presented to the test subjects by Yadava et al and Çakar et al [18,34]. Yadava et al proposed a predictive modeling framework to understand consumer choice towards E-commerce products in terms of "likes" and "dislikes" by analyzing EEG signals.…”

“…The test participants were asked to search and select three products of their interest from an e-commerce website and reach the maximum of their gift card limit to activate. Test subjects often experienced negative emotion while being unable to find necessary buttons such as "add to cart" or "sorting options" [34]. These Neuromarketing experiments on E-commerce products may help developers to build better user experience.…”

“…As price is mentioned as an important factor that determines the user's interest on purchasing a product, a number of Neuromarketing studies have used price alongside the products. In the aforementioned study by Çakar et al [34] price was displayed while recording brain response during first-time e-commerce user experience. Marques et al [22], Çakir et al [24], Gong et al…”