Price cues and customer price knowledge

Eric T. Anderson*, Duncan I. Simester

*Corresponding author for this work

Research output: Chapter in Book/Report/Conference proceedingChapter

8 Scopus citations

Abstract

A price cue is defined as any marketing tactic used to persuade customers that prices offer good value compared to competitors' prices, past prices or future prices. In this chapter, we review the academic literature that documents the effectiveness of different types of prices cues. The leading economic explanation for why price cues are effective focuses on the role of customer price knowledge and the ability of customers to evaluate whether prices offer good value. We survey the evidence supporting this theory, including a review of the literature on customer price knowledge. Finally, we document the boundaries of when price cues are effective and identify several moderating factors.

Original languageEnglish (US)
Title of host publicationHandbook of Pricing Research in Marketing
PublisherEdward Elgar Publishing Ltd.
Pages150-166
Number of pages17
ISBN (Electronic)9781848447448
ISBN (Print)9781847202406
StatePublished - Mar 31 2009

ASJC Scopus subject areas

  • Social Sciences(all)
  • Economics, Econometrics and Finance(all)
  • Business, Management and Accounting(all)

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    Anderson, E. T., & Simester, D. I. (2009). Price cues and customer price knowledge. In Handbook of Pricing Research in Marketing (pp. 150-166). Edward Elgar Publishing Ltd..