Substituting piracy with a pay-what-you-want option: does it make sense?

Harbi, Sana El; Grolleau, Gilles; Bekir, Insaf

doi:10.1007/s10657-011-9287-y

Cited by 30 publications

(14 citation statements)

References 19 publications

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“…One approach views PWYW as a "loss leader" strategy. According to this approach, allowing PWYW for one product can generate profitable cross-sales, as consumers buy other high-margin products from the same seller (Steiner, 1997;Kim, Natter, & Spann, 2010;El Harbi, Grolleau, & Bekir, 2014). Alternatively, PWYW might enable a seller to do away with supply chain intermediaries and thus extract additional profits (Elberse & Bergsman, 2008a, b).…”

Section: Literature Review Pay What You Wantmentioning

confidence: 99%

“Pay what you want” as threshold public good provision

Mak

Zwick

Rao

et al. 2015

Organizational Behavior and Human Decision Processes

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Prevailing wisdom on "pay what you want" (PWYW) pricing focuses on the influence of altruism or fairness on consumers' payments. In this paper, we offer a different perspective by demonstrating that, if the seller and consumers interact repeatedly, and future provision of PWYW depends on whether current revenue under PWYW is sufficient for the seller to achieve financial goals, then paying under PWYW can be likened to paying for a threshold public good. Our model implies that continuous provision of PWYW can be profitable even when all consumers are self-interested. We find in two experiments that if there is pre-payment online chat-room-style communication among consumers, then efficient tacit coordination at the payment stage can be accomplished to achieve continuous PWYW provision. We also show experimentally that pre-payment communication can sustain PWYW provision even when consumers have limited feedback about each other's payments, or limited information about the market.

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Section: Literature Review Pay What You Wantmentioning

confidence: 99%

“Pay what you want” as threshold public good provision

Mak

Zwick

Rao

et al. 2015

Organizational Behavior and Human Decision Processes

View full text Add to dashboard Cite

show abstract

“…Consequently, the provider is not entitled to withdraw from a sale even if the customer pays nothing (i.e., a price of zero) or an amount that falls below a minimal threshold value of the seller (unknown to the customer) as in the case of the "Name-Your-Own-Price" procedure (Fay, 2004). The English-speaking literature also uses the terms "Pay What You Think It Is Worth" (El Harbi et al, 2014), "Pay What You Believe Is Fair" (Sleesman & Conlon, 2016), "Pay As You Wish" (Bertini & Koenigsberg, 2014), "Pay What You Like" (Fernandez & Nahata, 2009), "Pay What You Can" (Saccardo et al, 2015) and "Pick Your Own Price" (Bourreau et al, 2015) as synonyms for the PWYW pricing method.…”

Section: Introductionmentioning

confidence: 99%

Pay-What-You-Want pricing: An integrative review of the empirical research literature

Gerpott¹

2017

10.5267/j.msl

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In a Pay What You Want (PWYW) setting companies empower their customers to fix the prices buyers voluntarily pay for a delivered product or service. The seller agrees to any price (including zero) customers are paying. For about ten years researchers empirically investigate customer reactions to and economic outcomes of this pricing method. The present paper distinguishes PWYW from other voluntary payment mechanisms and reviews 72 English-or German-speaking PWYW publications, which appeared between January 2006 and September 2016 and contain 97 independent empirical data sets. Prior PWYW research is structured with the help of a conceptual framework which incorporates payment procedure design, buyer, seller, focal sales object and market context characteristics as factors potentially influencing customer perceptions of the PWYW scheme and their behavioral reactions to PWYW offers. The review discusses both consistent key findings as well as contradictory results and derives recommendations for future empirical PWYW research efforts.

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“…Whilst the majority of PWYW research has been done on either digital goods [10] [14] [15] or in the service sector [1] [3] [8], a travel mug was chosen for the present experiment. It was assumed that all participants would be familiar with travel mugs which was confirmed in the pre-test.…”

Section: Methodsmentioning

confidence: 99%

The Effects of Social Interaction and Social Norm Compliance in Pay-What-You-Want Situations

Hilbert¹,

Suessmair²

2015

AJIBM

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Since Pay-What-You-Want is a relatively new field of study, the influence factors during the pricing process are not sufficiently explored. It was hypothesized that in a hypothetical Pay-What-YouWant situation, increased social interaction and social norm compliance would lead to a higher willingness to pay for a travel mug. In a laboratory experiment, 79 German students were randomly assigned to three groups which varied in the degree of social interaction. Social norm compliance was assessed with a questionnaire. A 3 × 3 between-group factorial ANOVA showed a significant main effect for social interaction (p = 0.025, η 2 = 0.08), whilst social norm compliance was slightly not significant (p = 0.067, η 2 = 0.03). Follow-up comparisons were calculated and the results discussed. The findings implicate that especially the degree of social interaction should be regarded, both by researchers and practitioners, as an important situational factor influencing the price in a Pay-What-You-Want situation.

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Substituting piracy with a pay-what-you-want option: does it make sense?

Cited by 30 publications

References 19 publications

“Pay what you want” as threshold public good provision

“Pay what you want” as threshold public good provision

Pay-What-You-Want pricing: An integrative review of the empirical research literature

The Effects of Social Interaction and Social Norm Compliance in Pay-What-You-Want Situations

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