Friends and Family: How In-Group Focused Promotions Can Increase Purchase

Customer Needs and Solutions, 1 (4), 333-344, 2014

37 Pages Posted: 3 Jan 2015

See all articles by Karen Page Winterich

Karen Page Winterich

Pennsylvania State University - Mary Jean and Frank P. Smeal College of Business Administration

Vikas Mittal

Rice University

Vanitha Swaminathan

University of Pittsburgh

Date Written: January 2, 2015

Abstract

Firms use large majorities of their budgets on sales promotions such as coupons and sales events. Many of these sales promotions are framed as “Friends & Family” or “Preferred Customer.” Which of these frames is more effective, when, and why? We answer these questions building on existing research on deal exclusivity. We show that the success of promotions framed as in-group versus self-focused depends on whether they are targeted toward interdependent or independent customers. We find that interdependent customers are more receptive to in-group focused promotions because they perceive such promotions as being higher-value deals. We also show that consistency with brand personality matters: the benefit of in-group focused promotions for interdependent consumers is higher for brands with a group-oriented personality. Overall, these results show how sales promotions can be more effective without having to increase the magnitude of the promotion.

Keywords: sales promotions, self-construal, interdependence, in-group, brand personality

Suggested Citation

Winterich, Karen Page and Mittal, Vikas and Swaminathan, Vanitha, Friends and Family: How In-Group Focused Promotions Can Increase Purchase (January 2, 2015). Customer Needs and Solutions, 1 (4), 333-344, 2014. Available at SSRN: https://ssrn.com/abstract=2544643

Karen Page Winterich (Contact Author)

Pennsylvania State University - Mary Jean and Frank P. Smeal College of Business Administration ( email )

University Park, PA 16802
United States

Vikas Mittal

Rice University ( email )

6100 South Main Street
250 McNair
Houston, TX 77005-1892
United States

Vanitha Swaminathan

University of Pittsburgh ( email )

135 N Bellefield Ave
Pittsburgh, PA 15260
United States

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