The Consumer Psychology of Mail-In Rebates: A Model of Anchoring and Adjustment

38 Pages Posted: 17 Jan 2006

See all articles by Dilip Soman

Dilip Soman

University of Toronto - Department of Marketing

John T. Gourville

Harvard Business School

Date Written: December 10, 2005

Abstract

Consumers who buy a product intending to use an accompanying mail-in rebate often do not redeem the rebate. To explain this behavior, we argue that consumers use an anchoring and adjustment approach to predicting the likelihood of redeeming a rebate. In keeping with previous research on anchoring and adjustment, for instance, we show that when presented with a desirable product, consumers anchor on scenarios of successful redemption and adjust insufficiently for things that could go wrong in the redemption process.

However, we also propose this anchoring and adjustment process is impacted by a consumer's motivation to purchase the rebated product. In particular, we propose the anchor employed will be driven by the valence of a consumer's underlying motivation. Specifically, a consumer that is motivated to purchase the product will anchor on scenarios of successful redemption while a consumer that is motivated to avoid purchasing will anchor on scenarios of failed redemption. We also propose that the degree of adjustment consumer's employ will be driven by their strength of motivation - i.e., the stronger the motivation, the less the adjustment to the motivational anchor. Consequently, mail in rebates either can serve to enhance or to dampen purchase intention depending on a consumer's underlying motivation. In other words, rebates offer consumers a means to justify a preferred course of action. Across a series of three studies, we show this to be the case.

Keywords: mail-in rebates, anchoring and adjustment, debiasing

JEL Classification: M30, M31

Suggested Citation

Soman, Dilip and Gourville, John T., The Consumer Psychology of Mail-In Rebates: A Model of Anchoring and Adjustment (December 10, 2005). HBS Marketing Research Paper No. 06-02. Available at SSRN: https://ssrn.com/abstract=875658 or http://dx.doi.org/10.2139/ssrn.875658

Dilip Soman (Contact Author)

University of Toronto - Department of Marketing ( email )

John T. Gourville

Harvard Business School ( email )

Soldiers Field
Boston, MA 02163
United States
617-495-6133 (Phone)
617-496-5637 (Fax)

Register to save articles to
your library

Register

Paper statistics

Downloads
661
rank
35,865
Abstract Views
3,753
PlumX